Fastly Exceeds Q2 Revenue Guidance, Sets Record for Security Revenue and Improves Margins

Fastly reported Q2 revenue of $148.7 million, a 12% YoY increase, with security revenue reaching a record high at 20% of total revenue. The company improved its gross margin by 170 basis points and reduced its operating loss to $4.6 million. Fastly generated $26 million in cash flow from operations and raised its 2025 revenue guidance by $8 million. The total customer count reached 3,097, with enterprise customers increasing by 27% from the last quarter.

Fastly Inc. (FSLY) reported robust financial performance for the second quarter of 2025, with total revenue reaching $148.7 million, marking a 12% year-over-year (YoY) increase. Security revenue accounted for a significant 20% of total revenue, highlighting the growing importance of cybersecurity in the company's revenue mix [2].

Key financial highlights include:

- Revenue Growth: Fastly's revenue grew by 12% YoY, surpassing analyst expectations.
- Gross Margin: The company improved its gross margin by 170 basis points to 54.5%.
- Operating Loss: Fastly reduced its operating loss to $37.5 million, a notable improvement compared to the previous year.
- Free Cash Flow: The company generated $10.9 million in positive free cash flow, a significant improvement from the $18.5 million of negative free cash flow reported in the second quarter of 2024.
- Customer Count: Fastly's total customer count reached 3,097, with enterprise customers increasing by 27% from the previous quarter.

Fastly's Chief Executive Officer, Kip Compton, stated, "Fastly’s second quarter performance resulted in another record revenue quarter, outperforming both our revenue and operating loss guidance. We are raising our financial guidance for 2025 and now expect to generate positive free cash flow for the year" [3].

The appointment of Richard Wong as the new Chief Financial Officer (CFO) and Scott R. Lovett as President, Go to Market, effective immediately, reflects Fastly's commitment to strategic leadership and organizational restructuring [3].

Wall Street analysts have set a moderate price target for FSLY, with an average one-year price target of $6.75. GuruFocus, however, sees significant upside potential, estimating the GF Value of FSLY to reach $13.39 over the next year, translating to a potential upside of 105.37% from its current price of $6.52 [2].

Fastly will host an investor conference call on August 6, 2025, to discuss its results further. For more information, visit [Fastly's Investor Relations page](https://investors.fastly.com).

References:
[1] https://investors.fastly.com/news/news-details/2025/Fastly-Announces-Second-Quarter-2025-Financial-Results/
[2] https://www.gurufocus.com/news/3042717/fastly-fsly-sees-strong-q2-with-revenue-and-leadership-changes?r=4bf001661e6fdd88d0cd7a5659ff9748
[3] https://finance.yahoo.com/news/fastly-announces-second-quarter-2025-200500862.html