Fastly 2025 Q3 Earnings Beats Expectations with 22.4% Reduced Net Loss

Fastly (FSLY) delivered third-quarter results that exceeded expectations, with revenue growth outpacing forecasts and a significant narrowing of losses. The company raised its full-year revenue guidance, signaling confidence in its strategic initiatives.

Revenue

Fastly’s total revenue surged 15.3% year-over-year to $158.22 million, surpassing the $151.04 million consensus estimate. Network services revenue reached $118.8 million, a 11% increase, while security revenue surged 30% to $34 million, reflecting strong cross-sell execution and platform innovation.

Earnings/Net Income

The company narrowed its net loss to $29.48 million in Q3 2025, a 22.4% reduction compared to the $38.02 million loss in the prior-year period. Earnings per share improved to a loss of $0.20 from $0.27, a 25.9% improvement. While progress is evident, the company has sustained losses for eight consecutive years, underscoring ongoing financial challenges.

Post-Earnings Price Action Review

Fastly’s stock experienced a dramatic post-earnings surge, with shares jumping 26.7% in the morning session following the report. This followed a 15% pre-market rally driven by strong results and raised guidance. The stock has since seen mixed performance, gaining 1.38% on the day but declining 6.81% month-to-date. The sharp post-earnings move reflects investor optimism about the company’s improved profitability and strategic momentum, particularly in its security segment.

CEO Commentary

CEO Kip Compton highlighted record revenue, operating profit, and free cash flow in Q3 2025, crediting accelerated growth and operating leverage. He emphasized platform innovation, cross-sell execution, and 30% year-over-year security revenue growth as key drivers. The CEO also noted momentum in acquiring “some of the most sought-after customers worldwide,” reinforcing the company’s focus on innovation and retention.

Guidance

Fastly provided Q4 2025 revenue guidance of $159.0–$163.0 million and full-year 2025 revenue of $610.0–$614.0 million. Non-GAAP operating income is projected at $8.0–$12.0 million for Q4 and $9.0–$13.0 million for the year. Non-GAAP net income per share is expected to range between $0.04–$0.08 in Q4 and $0.03–$0.07 for the full year.

Additional News

Fastly’s stock price surged 26.7% post-earnings, driven by record revenue and raised guidance. Institutional investors, including Hussman Strategic Advisors, increased stakes, while insider selling activity raised concerns. The company also announced a $18.1 million free cash flow turnaround and a 30% security revenue growth, reinforcing its strategic focus on innovation.

Fastly’s Q3 performance reflects a pivotal shift in its financial trajectory, with revenue growth and improved profitability metrics positioning it for long-term stability. However, ongoing losses and market volatility highlight the need for continued operational efficiency and customer retention efforts.