Fastly (FSLY) Q1 2026 earnings summary

Executive summary

• Q1 2026 revenue reached a record $173 million, up 20% year-over-year, driven by strong security and compute growth and increased usage from existing customers.

• Security revenue grew 47% year-over-year, now 22% of total revenue, with broad-based adoption of new products and innovation.

• Large customer count increased to 634, with top ten customers accounting for 34% of revenue and their revenue rising 25% year-over-year.

• Gross margin hit a record 65.1% (non-GAAP), up from 57.3% a year ago, aided by operational efficiencies and a one-time accounting policy change.

• Recognized as a leader in edge development and delivery by major industry analysts, with new CMO appointed and new security/developer tools launched.

Financial highlights

• Network services revenue was $126.2 million, up 11% year-over-year, outperforming market growth rates.

• Security revenue: $38.8 million (+47% YoY); Compute/Other: $8.0 million (+67% YoY).

• Non-GAAP net income was $22.9 million, compared to a net loss of $6.6 million in Q1 2025; GAAP net loss narrowed to $20.5 million from $39.1 million.

• Adjusted EBITDA was $29.5 million (vs. $7.8 million prior year); free cash flow was $4.1 million, down from $8.2 million due to higher infrastructure spend.

• Ended Q1 with $330 million in cash, marketable securities, and investments.

Outlook and guidance

• Q2 2026 revenue expected between $170 million and $176 million, 16% annual growth at midpoint.

• Full-year 2026 revenue guidance raised to $710 million–$725 million, 15% annual growth at midpoint.

• Gross margin for 2026 expected at 64% ±50 basis points.

• Non-GAAP operating profit for 2026 guided to $58 million–$68 million (9% margin midpoint); non-GAAP net income per share: $0.27–$0.33.

• Free cash flow guidance for 2026 maintained at $40 million–$50 million.