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Winners And Losers Of Q2: Akamai (NASDAQ:AKAM) Vs The Rest Of The Software Development Stocks


Kayode Omotosho /
2022/10/13 3:25 am EDT
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Wrapping up Q2 earnings, we look at the numbers and key takeaways for the software development stocks, including Akamai (NASDAQ:AKAM) and its peers.

Software is eating the world, as Marc Andreessen says, and there is virtually no industry left that has been untouched by it. That in turn drives increasing demand for tools that help software developers do their jobs, whether it is monitoring critical cloud infrastructure, integrating audio and video functionality or ensuring smooth streaming of content.

The 14 software development stocks we track reported a mixed Q2; on average, revenues beat analyst consensus estimates by 3.49%, while on average next quarter revenue guidance was 0.45% above consensus. Increasing interest rates hurt growth companies as investors search for near-term cash flows and software development stocks have not been spared, with share prices down 17.5% since the previous earnings results, on average.

Akamai (NASDAQ:AKAM)

Founded in 1999 by two engineers from MIT, Akamai (NASDAQ:AKAM) provides software for organizations to efficiently deliver web content to their customers.

Akamai reported revenues of $903.3 million, up 5.92% year on year, in line with analyst expectations. It was a weaker quarter for the company, with slow revenue growth.

"Despite a continued challenging macro-economic environment and foreign exchange headwinds, Akamai delivered another quarter of solid results," said Dr. Tom Leighton, Akamai's Chief Executive Officer.

Akamai Total Revenue

Akamai delivered the weakest performance against analyst estimates of the whole group. The stock is down 17.5% since the results and currently trades at $78.42.

Read our full report on Akamai here, it's free.

Best Q2: HashiCorp (NASDAQ:HCP)

Initially created as a research project at the University of Washington, HashiCorp (NASDAQ:HCP) provides software that helps companies operate their own applications in a multi-cloud environment.

HashiCorp reported revenues of $113.8 million, up 51.5% year on year, beating analyst expectations by 11.2%. It was a stunning quarter for the company, with an impressive beat of analyst estimates and exceptional revenue growth.

HashiCorp Total Revenue

HashiCorp delivered the strongest analyst estimates beat and highest full year guidance raise among its peers. The company added 30 enterprise customers paying more than $100,000 annually to a total of 734. The stock is down 4.23% since the results and currently trades at $28.97.

Is now the time to buy HashiCorp? Access our full analysis of the earnings results here, it's free.

Dynatrace (NYSE:DT)

Founded in Austria in 2005, Dynatrace (NYSE:DT) provides companies with software that allows them to monitor the performance of their full technology stack, from software applications to the infrastructure they run on.

Dynatrace reported revenues of $267.2 million, up 27.4% year on year, beating analyst expectations by 2.07%. It was a weak quarter for the company, with revenue guidance for both the next quarter and the full year missing analysts' estimates.

Dynatrace had the weakest full year guidance update in the group. The stock is down 10.5% since the results and currently trades at $34.26.

Read our full analysis of Dynatrace's results here.

Agora (NASDAQ:API)

Founded in 2014 by former engineers at WebEx and based in China, Agora (NASDAQ:API) provides a cloud platform that makes it easy for developers to integrate real-time audio and video functionalities in their apps.

Agora reported revenues of $40.9 million, down 3.2% year on year, beating analyst expectations by 1.95%. It was a decent quarter for the company, with accelerating customer growth but declining revenue.

Agora had the weakest revenue number among the peers. The company added 171 customers to a total of 2,877. The stock is down 34.6% since the results and currently trades at $3.10.

Read our full, actionable report on Agora here, it's free.

F5 Networks (NASDAQ:FFIV)

While the company initially started in the late 90s by selling hardware appliances, these days F5 (NASDAQ:FFIV) is making software that helps large enterprises ensure their web applications are always available, by distributing network traffic and protecting them from cyber attacks.

F5 Networks reported revenues of $674.4 million, up 3.52% year on year, in line with analyst expectations. It was a weaker quarter for the company, with slow revenue growth.

The stock is down 9.74% since the results and currently trades at $139.19.

Read our full, actionable report on F5 Networks here, it's free.

The author has no position in any of the stocks mentioned