Reports GAAP loss of $38.0 million and record
non-GAAP income of $2.4 million
Delivers record adjusted EBITDA of $13.3
million
Fastly, Inc. (NYSE: FSLY), a leader in global edge cloud
platforms, today announced financial results for its third quarter
ended September 30, 2024.
“Fastly delivered significant upside on our revenue guidance in
Q3 along with record non-GAAP net income and adjusted EBITDA,” said
Todd Nightingale, CEO of Fastly. “This was driven by
better-than-expected strength in some of our largest customers,
continued share gains outside of our top ten customers, and
faster-than-projected execution of our restructuring.”
“Our transformation initiatives are helping us focus on the
broader market with revenue outside of our ten largest customers
growing 20% year-over-year,” continued Nightingale. “This
diversification of our revenue base will drive more reliable,
predictable long-term growth, enabling us to invest in continued
edge cloud innovation and go-to-market reach.”
Three months ended
September 30,
Nine months ended
September 30,
2024
2023
2024
2023
Revenue
$
137,206
$
127,816
$
403,097
$
368,211
Gross margin
GAAP gross margin
54.5
%
51.7
%
54.8
%
51.8
%
Non-GAAP gross margin
57.7
%
55.9
%
58.3
%
56.0
%
Operating loss
GAAP operating loss
$
(40,590
)
$
(58,342
)
$
(133,584
)
$
(155,444
)
Non-GAAP operating loss
$
(520
)
$
(12,552
)
$
(22,857
)
$
(34,411
)
Net income (loss) per share
GAAP net loss per common share — basic and
diluted
$
(0.27
)
$
(0.42
)
$
(0.91
)
$
(0.86
)
Non-GAAP net income (loss) per common
share — basic and diluted
$
0.02
$
(0.06
)
$
(0.10
)
$
(0.18
)
For a reconciliation of non-GAAP financial measures to their
corresponding GAAP measures, please refer to the reconciliation
table at the end of this press release.
Third Quarter 2024 Financial Summary
- Total revenue of $137.2 million, representing 7% year-over-year
growth. Network services revenue of $107.4 million, representing 5%
year-over-year growth. Security revenue of $26.2 million,
representing 12% year-over-year growth. Other revenue of $3.6
million, representing 85% year-over-year growth. Network services
revenue includes solutions designed to improve performance of
websites, apps, APIs, and digital media. Security revenue includes
products designed to protect websites, apps, APIs, and users. Other
revenue includes Compute and Observability solutions.
- GAAP gross margin of 54.5%, compared to 51.7% in the third
quarter of 2023. Non-GAAP gross margin of 57.7%, compared to 55.9%
in the third quarter of 2023.
- GAAP net loss of $38.0 million, compared to $54.3 million in
the third quarter of 2023. Non-GAAP net income of $2.4 million,
compared to non-GAAP net loss of $8.0 million in the third quarter
of 2023.
- GAAP net loss per basic and diluted share of $0.27, compared to
$0.42 in the third quarter of 2023. Non-GAAP net income per diluted
share of $0.02, compared to non-GAAP net loss per basic and diluted
share of $0.06 in the third quarter of 2023.
Key Metrics
- Enterprise customer1 count was 576 in the third quarter, down
25 from the second quarter of 2024. Total customer count1 was 3,638
in the third quarter, up 343 from the second quarter of 2024.
- Fastly's top ten customers accounted for 33% of revenue in the
third quarter compared to 40% in the third quarter of 2023. Revenue
from the top ten customers declined 11% year-over-year compared to
revenue growth of 20% year-over-year from customers outside the top
ten.
- Last 12-month net retention rate (LTM NRR)2 decreased to 105%
in the third quarter from 110% in the second quarter of 2024.
- Remaining performance obligations (RPO)3 were $235 million, up
6% from $223 million in the second quarter of 2024.
Third Quarter Business and Product Highlights
- Fastly Threat Insights Report revealed 91% of cyberattacks now
target multiple organizations using mass scanning.
- Fastly’s “Bots Wars: How Bad Bots are Hurting Businesses”
research revealed 59% of organizations reported an increase in bot
attacks over the past year, with significant attacks costing
organizations $2.9 million on average.
- Hosted Xcelerate Sydney, a curated customer event bringing
together thought leaders and industry pioneers for a jam-packed day
of innovation.
- Enhanced Fastly Next-Gen WAF with new capabilities that reduced
the time to activate the product, enriched detection signals, and
provided additional context to data with Country and IP Corp/Site
lists.
- Updated Fastly Bot Management with new bot analysis capability
to provide customers with visibility and control of their bot
management expenses, while also enabling customers to provide logos
for bot challenges.
- Enhanced the Fastly trials experience with access to combined
trials for full product lines, helping customers discover new tools
and unlock the full value of the Fastly Edge Cloud Platform.
- Added the Fastly Support Portal to the Fastly single sign-on
experience, allowing customers to seamlessly navigate across the
Fastly Control Panel, Next-Gen WAF Console and Support Portal.
Fourth Quarter and Full Year 2024 Guidance
Q4 2024
Full Year 2024
Total Revenue (millions)
$136.0 - $140.0
$539.0 - $543.0
Non-GAAP Operating Loss
(millions)
($5.0) - ($1.0)
($28.0) - ($24.0)
Non-GAAP Net Income (Loss) per share
(4)(5)
($0.02) - $0.02
($0.12) - ($0.08)
A reconciliation of non-GAAP guidance measures to corresponding
GAAP measures is not available on a forward-looking basis without
unreasonable effort due to the uncertainty of expenses that may be
incurred in the future and cannot be reasonably determined or
predicted at this time, although it is important to note that these
factors could be material to Fastly’s future GAAP financial
results.
Conference Call Information
Fastly will host an investor conference call to discuss its
results at 1:30 p.m. PT / 4:30 p.m. ET on Wednesday, November 6,
2024.
Date: Wednesday, November 6, 2024 Time: 1:30 p.m. PT / 4:30 p.m.
ET Webcast: https://investors.fastly.com Dial-in: 888-330-2022
(US/CA) or 646-960-0690 (Intl.) Conf. ID#: 7543239
Please dial in at least 10 minutes prior to the 1:30 p.m. PT
start time. A live webcast of the call will be available at
https://investors.fastly.com where listeners may log on to the
event by selecting the webcast link under the “Quarterly Results”
section.
A telephone replay of the conference call will be available at
approximately 5:00 p.m. PT, November 6 through November 20, 2024 by
dialing 800-770-2030 or 647-362-9199 and entering the passcode
7543239.
About Fastly, Inc.
Fastly’s powerful and programmable edge cloud platform helps the
world’s top brands deliver online experiences that are fast, safe,
and engaging through edge compute, delivery, security, and
observability offerings that improve site performance, enhance
security, and empower innovation at global scale. Compared to other
providers, Fastly’s powerful, high-performance, and modern platform
architecture empowers developers to deliver secure websites and
apps with rapid time-to-market and demonstrated, industry-leading
cost savings. Organizations around the world trust Fastly to help
them upgrade the internet experience, including Reddit, Neiman
Marcus, Universal Music Group, and SeatGeek. Learn more about
Fastly at https://www.fastly.com, and follow us @fastly.
Forward-Looking Statements
This press release contains “forward-looking” statements that
are based on our beliefs and assumptions and on information
currently available to us on the date of this press release.
Forward-looking statements may involve known and unknown risks,
uncertainties, and other factors that may cause our actual results,
performance, or achievements to be materially different from those
expressed or implied by the forward-looking statements. These
statements include, but are not limited to, statements regarding
our future financial and operating performance, including our
outlook and guidance, our operating performance, our ability to
innovate, the success of our products and product enhancements,
investment in continued edge cloud innovation, the capabilities of
Fastly Next-Gen WAF, the capabilities of Fastly Bot Management,
expectations regarding customer experiences with the Fastly trials
experience and Support Portal, our customer acquisition and
go-to-market efforts, our ability to monetize, expectations
regarding customer mix and diversification of our revenue base, and
our ability to deliver on our long-term strategy. Except as
required by law, we assume no obligation to update these
forward-looking statements publicly or to update the reasons actual
results could differ materially from those anticipated in the
forward-looking statements, even if new information becomes
available in the future. Important factors that could cause our
actual results to differ materially are detailed from time to time
in the reports Fastly files with the Securities and Exchange
Commission (“SEC”), including those more fully described in
Fastly’s Annual Report on Form 10-K for the year ended December 31,
2023, in our Quarterly Report on Form 10-Q for the quarter ended
March 31, 2024, and in our Quarterly Report on Form 10-Q for the
quarter ended June 30, 2024. Additional information will also be
set forth in our Quarterly Report on Form 10-Q for the quarter
ended September 30, 2024. Copies of reports filed with the SEC are
posted on Fastly’s website and are available from Fastly without
charge.
Use of Non-GAAP Financial Measures
To supplement our condensed consolidated financial statements,
which are prepared and presented in accordance with accounting
principles generally accepted in the United States (“GAAP”), the
Company uses the following non-GAAP measures of financial
performance: non-GAAP gross profit, non-GAAP gross margin, non-GAAP
operating loss, non-GAAP net income (loss), non-GAAP basic and
diluted net income (loss) per common share, non-GAAP research and
development, non-GAAP sales and marketing, non-GAAP general and
administrative, free cash flow and adjusted EBITDA. The
presentation of this additional financial information is not
intended to be considered in isolation from, as a substitute for,
or superior to, the financial information prepared and presented in
accordance with GAAP. These non-GAAP measures have limitations in
that they do not reflect all of the amounts associated with our
results of operations as determined in accordance with GAAP. In
addition, these non-GAAP financial measures may be different from
the non-GAAP financial measures used by other companies. These
non-GAAP measures should only be used to evaluate our results of
operations in conjunction with the corresponding GAAP measures.
Management compensates for these limitations by reconciling these
non-GAAP financial measures to the most comparable GAAP financial
measures within our earnings releases.
Non-GAAP gross profit, non-GAAP gross margin, non-GAAP operating
loss, non-GAAP net income (loss) and non-GAAP basic and diluted net
loss per common share, non-GAAP research and development, non-GAAP
sales and marketing, and non-GAAP general and administrative differ
from GAAP in that they exclude stock-based compensation expense,
amortization of acquired intangible assets, net gain on
extinguishment of debt, impairment expense and amortization of debt
discount and issuance costs.
Adjusted EBITDA: excludes stock-based compensation
expense, depreciation and other amortization expenses, amortization
of acquired intangible assets, executive transition costs, interest
income, interest expense, including amortization of debt discount
and issuance costs, net gain on extinguishment of debt, impairment
expense, other income (expense), net, and income taxes.
Amortization of Acquired Intangible Assets: consists of
non-cash charges that can be affected by the timing and magnitude
of asset purchases and acquisitions. Management considers its
operating results without this activity when evaluating its ongoing
non-GAAP performance and its adjusted EBITDA performance because
these charges are non-cash expenses that can be affected by the
timing and magnitude of asset purchases and acquisitions and may
not be reflective of our core business, ongoing operating results,
or future outlook.
Amortization of Debt Discount and Issuance Costs:
consists primarily of amortization expense related to our debt
obligations. Management considers its operating results without
this activity when evaluating its ongoing non-GAAP net income
(loss) performance and its adjusted EBITDA performance because it
is not believed by management to be reflective of our core
business, ongoing operating results or future outlook. These are
included in our total interest expense.
Capital Expenditures: consists of cash used for purchases
of property and equipment, net of proceeds from sale of property
and equipment, capitalized internal-use software and payments on
finance lease obligations, as reflected in our statement of cash
flows.
Depreciation and Other Amortization Expense: consists of
non-cash charges that can be affected by the timing and magnitude
of asset purchases. Management considers its operating results
without this activity when evaluating its ongoing adjusted EBITDA
performance because these charges are non-cash expenses that can be
affected by the timing and magnitude of asset purchases and may not
be reflective of our core business, ongoing operating results, or
future outlook.
Executive Transition Costs: consists of one-time cash and
non-cash charges recognized with respect to changes in our
executive’s employment status. Management considers its operating
results without this activity when evaluating its ongoing non-GAAP
net income (loss) performance and its adjusted EBITDA performance
because it is not believed by management to be reflective of our
core business, ongoing operating results or future outlook.
Free Cash Flow: calculated as net cash used in operating
activities less purchases of property and equipment, net of
proceeds from sale of property and equipment, principal payments of
finance lease liabilities, capitalized internal-use software costs
and advance payments made related to capital expenditures.
Management specifically identifies adjusting items in the
reconciliation of GAAP to non-GAAP financial measures. Management
considers non-GAAP free cash flow to be a profitability and
liquidity measure that provides useful information to management
and investors about the amount of cash generated by the business
that can possibly be used for investing in Fastly's business and
strengthening its balance sheet, but it is not intended to
represent the residual cash flow available for discretionary
expenditures. The presentation of non-GAAP free cash flow is also
not meant to be considered in isolation or as an alternative to
cash flows from operating activities as a measure of liquidity.
Impairment Expense: consists of charges related to our
long-lived assets. Management considers its operating results
without this activity when evaluating its ongoing non-GAAP net
income (loss) performance and its adjusted EBITDA performance
because it is not believed by management to be reflective of our
core business, ongoing operating results or future outlook.
Income Taxes: consists primarily of expenses recognized
related to state and foreign income taxes. Management considers its
operating results without this activity when evaluating its ongoing
adjusted EBITDA performance because it is not believed by
management to be reflective of our core business, ongoing operating
results or future outlook.
Interest Expense: consists primarily of interest expense
related to our debt instruments, including amortization of debt
discount and issuance costs. Management considers its operating
results without this activity when evaluating its ongoing non-GAAP
net income (loss) performance and its adjusted EBITDA performance
because it is not believed by management to be reflective of our
core business, ongoing operating results or future outlook.
Interest Income: consists primarily of interest income
related to our marketable securities. Management considers its
operating results without this activity when evaluating its ongoing
non-GAAP net income (loss) performance and its adjusted EBITDA
performance because it is not believed by management to be
reflective of our core business, ongoing operating results or
future outlook.
Net Gain on Debt Extinguishment: relates to net gain on
the partial repurchase of our outstanding convertible debt.
Management considers its operating results without this activity
when evaluating its ongoing non-GAAP net income (loss) performance
and its adjusted EBITDA performance because it is not believed by
management to be reflective of our core business, ongoing operating
results or future outlook.
Other Income (Expense), Net: consists primarily of
foreign currency transaction gains and losses. Management considers
its operating results without this activity when evaluating its
ongoing adjusted EBITDA performance because it is not believed by
management to be reflective of our core business, ongoing operating
results or future outlook.
Restructuring Charges: consists primarily of
employee-related severance and termination benefits related to
management's restructuring plan that resulted in a reduction in our
workforce. Management considers its operating results without this
activity when evaluating its ongoing non-GAAP net income (loss)
performance and its adjusted EBITDA performance because it is not
believed by management to be reflective of our core business,
ongoing operating results or future outlook.
Stock-Based Compensation Expense: consists of expenses
for stock options, restricted stock units, performance awards,
restricted stock awards and Employee Stock Purchase Plan ("ESPP")
under our equity incentive plans. Although stock-based compensation
is an expense for the Company and is viewed as a form of
compensation, management considers its operating results without
this activity when evaluating its ongoing non-GAAP net income
(loss) performance and its adjusted EBITDA performance, primarily
because it is a non-cash expense not believed by management to be
reflective of our core business, ongoing operating results, or
future outlook. In addition, the value of some stock-based
instruments is determined using formulas that incorporate
variables, such as market volatility, that are beyond our
control.
Management believes these non-GAAP financial measures and
adjusted EBITDA serve as useful metrics for our management and
investors because they enable a better understanding of the
long-term performance of our core business and facilitate
comparisons of our operating results over multiple periods and to
those of peer companies, and when taken together with the
corresponding GAAP financial measures and our reconciliations,
enhance investors' overall understanding of our current financial
performance.
In the financial tables below, the Company provides a
reconciliation of the most comparable GAAP financial measure to the
historical non-GAAP financial measures used in this press
release.
Key Metrics
1 Our number of customers is calculated based on the number of
separate identifiable operating entities with which we have a
billing relationship in good standing, from which we recognized
revenue during the current quarter. Our enterprise customers are
defined as those with annualized current quarter revenue in excess
of $100,000. This is calculated by taking the revenue for each
customer within the quarter and multiplying it by four.
2 We calculate LTM Net Retention Rate by dividing the total
customer revenue for the prior twelve-month period (“prior 12-month
period”) ending at the beginning of the last twelve-month period
(“LTM period”) minus revenue contraction due to billing decreases
or customer churn, plus revenue expansion due to billing increases
during the LTM period from the same customers by the total prior
12-month period revenue. We believe the LTM Net Retention Rate is
supplemental as it removes some of the volatility that is inherent
in a usage-based business model.
3 Remaining performance obligations include future committed
revenue for periods within current contracts with customers, as
well as deferred revenue arising from consideration invoiced for
which the related performance obligations have not been
satisfied.
4 Non-GAAP Net Income (Loss) per share is calculated as Non-GAAP
Net Income (Loss) divided by weighted average basic shares for
2024.
5 Assumes weighted average basic shares outstanding of 141.0
million in Q4 2024 and 137.5 million for the full year 2024.
Condensed Consolidated Statements of
Operations
(in thousands, except per share
amounts, unaudited)
Three months ended
September 30,
Nine months ended
September 30,
2024
2023
2024
2023
Revenue
$
137,206
$
127,816
$
403,097
$
368,211
Cost of revenue(1)
62,466
61,730
182,222
177,657
Gross profit
74,740
66,086
220,875
190,554
Operating expenses:
Research and development(1)
31,884
39,068
105,238
113,920
Sales and marketing(1)
45,994
51,043
148,560
143,111
General and administrative(1)
27,173
30,001
87,245
84,651
Impairment expense
559
4,316
3,696
4,316
Restructuring charges
9,720
—
9,720
—
Total operating expenses
115,330
124,428
354,459
345,998
Loss from operations
(40,590
)
(58,342
)
(133,584
)
(155,444
)
Net gain on extinguishment of debt
—
—
—
36,760
Interest income
3,819
4,908
11,604
13,602
Interest expense
(473
)
(862
)
(1,516
)
(3,307
)
Other expense, net
(317
)
(16
)
(213
)
(1,069
)
Loss before income tax expense
(37,561
)
(54,312
)
(123,709
)
(109,458
)
Income tax expense (benefit)
455
(1
)
1,463
244
Net loss
$
(38,016
)
$
(54,311
)
$
(125,172
)
$
(109,702
)
Net loss per share attributable to
common stockholders, basic and diluted
$
(0.27
)
$
(0.42
)
$
(0.91
)
$
(0.86
)
Weighted-average shares used in
computing net loss per share attributable to common stockholders,
basic and diluted
139,237
129,873
137,097
127,735
__________
(1) Includes stock-based
compensation expense as follows:
Three months ended
September 30,
Nine months ended
September 30,
2024
2023
2024
2023
Cost of revenue
$
1,911
$
2,860
$
6,734
$
8,378
Research and development
7,378
12,122
25,684
35,808
Sales and marketing
7,113
9,061
22,014
25,643
General and administrative
8,614
11,670
28,553
31,027
Total
$
25,016
$
35,713
$
82,985
$
100,856
Reconciliation of GAAP to Non-GAAP
Financial Measures
(in thousands, unaudited)
Three months ended
September 30,
Nine months ended
September 30,
2024
2023
2024
2023
Gross profit
GAAP gross profit
$
74,740
$
66,086
$
220,875
$
190,554
Stock-based compensation
1,911
2,860
6,734
8,378
Amortization of acquired intangible
assets
2,475
2,475
7,425
7,425
Non-GAAP gross profit
$
79,126
$
71,421
$
235,034
$
206,357
GAAP gross margin
54.5
%
51.7
%
54.8
%
51.8
%
Non-GAAP gross margin
57.7
%
55.9
%
58.3
%
56.0
%
Research and development
GAAP research and development
$
31,884
$
39,068
$
105,238
$
113,920
Stock-based compensation
(7,378
)
(10,426
)
(25,684
)
(34,112
)
Executive transition costs
—
(2,406
)
—
(2,406
)
Non-GAAP research and
development
$
24,506
$
26,236
$
79,554
$
77,402
Sales and marketing
GAAP sales and marketing
$
45,994
$
51,043
$
148,560
$
143,111
Stock-based compensation
(7,113
)
(9,061
)
(22,014
)
(25,643
)
Amortization of acquired intangible
assets
(2,300
)
(2,576
)
(6,901
)
(7,726
)
Non-GAAP sales and marketing
$
36,581
$
39,406
$
119,645
$
109,742
General and administrative
GAAP general and administrative
$
27,173
$
30,001
$
87,245
$
84,651
Stock-based compensation
(8,614
)
(11,670
)
(28,553
)
(31,027
)
Non-GAAP general and
administrative
$
18,559
$
18,331
$
58,692
$
53,624
Operating loss
GAAP operating loss
$
(40,590
)
$
(58,342
)
$
(133,584
)
$
(155,444
)
Stock-based compensation
25,016
34,017
82,985
99,160
Restructuring charges
9,720
—
9,720
—
Executive transition costs
—
2,406
—
2,406
Amortization of acquired intangible
assets
4,775
5,051
14,326
15,151
Impairment expense
559
4,316
3,696
4,316
Non-GAAP operating loss
$
(520
)
$
(12,552
)
$
(22,857
)
$
(34,411
)
Net loss
GAAP net loss
$
(38,016
)
$
(54,311
)
$
(125,172
)
$
(109,702
)
Stock-based compensation
25,016
34,017
82,985
99,160
Restructuring charges
9,720
—
9,720
—
Executive transition costs
—
2,406
—
2,406
Amortization of acquired intangible
assets
4,775
5,051
14,326
15,151
Net gain on extinguishment of debt
—
—
—
(36,760
)
Impairment expense
559
4,316
3,696
4,316
Amortization of debt discount and issuance
costs
358
502
1,061
2,021
Non-GAAP net income (loss)
$
2,412
$
(8,019
)
$
(13,384
)
$
(23,408
)
Non-GAAP net income (loss) per common
share — basic and diluted
$
0.02
$
(0.06
)
$
(0.10
)
$
(0.18
)
Weighted average basic common
shares
139,237
129,873
137,097
127,735
Weighted average diluted common
shares
143,415
129,873
137,097
127,735
Reconciliation of GAAP to Non-GAAP
Financial Measures
(in thousands, unaudited)
(continued)
Three months ended
September 30,
Nine months ended
September 30,
2024
2023
2024
2023
Reconciliation of GAAP to Non-GAAP
diluted shares
GAAP diluted shares
139,237
129,873
137,097
127,735
Other dilutive equity awards
4,178
—
—
—
Non-GAAP diluted shares
143,415
129,873
137,097
127,735
Non-GAAP diluted net income (loss) per
share
$
0.02
$
(0.06
)
$
(0.10
)
$
(0.18
)
Three months ended
September 30,
Nine months ended
September 30,
2024
2023
2024
2023
Adjusted EBITDA
GAAP net loss
$
(38,016
)
$
(54,311
)
$
(125,172
)
$
(109,702
)
Stock-based compensation
25,016
34,017
82,985
99,160
Restructuring charges
9,720
—
9,720
—
Executive transition costs
—
2,406
—
2,406
Net gain on extinguishment of debt
—
—
—
(36,760
)
Impairment expense
559
4,316
3,696
4,316
Depreciation and other amortization
13,781
13,202
40,624
38,412
Amortization of acquired intangible
assets
4,775
5,051
14,326
15,151
Amortization of debt discount and issuance
costs
358
502
1,061
2,021
Interest income
(3,819
)
(4,908
)
(11,604
)
(13,602
)
Interest expense
115
360
455
1,286
Other expense, net
317
16
213
1,069
Income tax expense (benefit)
455
(1
)
1,463
244
Adjusted EBITDA
$
13,261
$
650
$
17,767
$
4,001
Condensed Consolidated Balance
Sheets
(in thousands, unaudited)
As of
September 30, 2024
As of
December 31, 2023
ASSETS
Current assets:
Cash and cash equivalents
$
217,514
$
107,921
Marketable securities, current
90,733
214,799
Accounts receivable, net of allowance for
credit losses
116,800
120,498
Prepaid expenses and other current
assets
28,011
20,455
Total current assets
453,058
463,673
Property and equipment, net
180,288
176,608
Operating lease right-of-use assets,
net
47,700
55,212
Goodwill
670,356
670,356
Intangible assets, net
47,776
62,475
Marketable securities, non-current
—
6,088
Other assets
72,576
90,779
Total assets
$
1,471,754
$
1,525,191
LIABILITIES AND STOCKHOLDERS’
EQUITY
Current liabilities:
Accounts payable
$
11,354
$
5,611
Accrued expenses
40,854
61,818
Finance lease liabilities, current
4,882
15,684
Operating lease liabilities, current
23,857
24,042
Other current liabilities
33,261
40,539
Total current liabilities
114,208
147,694
Long-term debt
344,498
343,507
Finance lease liabilities, non-current
—
1,602
Operating lease liabilities,
non-current
40,565
48,484
Other long-term liabilities
3,029
4,416
Total liabilities
502,300
545,703
Stockholders’ equity:
Common stock
3
3
Additional paid-in capital
1,929,397
1,815,245
Accumulated other comprehensive loss
(22
)
(1,008
)
Accumulated deficit
(959,924
)
(834,752
)
Total stockholders’ equity
969,454
979,488
Total liabilities and stockholders’
equity
$
1,471,754
$
1,525,191
Condensed Consolidated Statements of
Cash Flows
(in thousands, unaudited)
Three months ended
September 30,
Nine months ended
September 30,
2024
2023
2024
2023
Cash flows from operating
activities:
Net loss
$
(38,016
)
$
(54,311
)
$
(125,172
)
$
(109,702
)
Adjustments to reconcile net loss to net
cash provided by (used in) operating activities:
Depreciation expense
13,656
13,055
40,251
38,015
Amortization of intangible assets
4,900
5,175
14,699
15,525
Non-cash lease expense
5,463
5,464
16,819
17,227
Amortization of debt discount and issuance
costs
358
501
1,061
2,020
Amortization of deferred contract
costs
4,773
4,082
13,877
11,253
Stock-based compensation
25,016
35,713
82,985
100,856
Deferred income taxes
339
—
900
—
Provision for credit losses
1,054
211
2,400
1,311
(Gain) loss on disposals of property and
equipment
—
(42
)
444
505
Amortization of premiums (discounts) on
investments
(1,064
)
(403
)
(3,466
)
344
Impairment of operating lease right-of-use
assets
371
401
371
588
Impairment expense
559
4,316
3,696
4,316
Net gain on extinguishment of debt
—
—
—
(36,760
)
Other adjustments
520
71
83
(257
)
Changes in operating assets and
liabilities:
Accounts receivable
(3,976
)
(20,538
)
1,298
(10,355
)
Prepaid expenses and other current
assets
(2,589
)
5,019
(7,420
)
4,602
Other assets
(2,705
)
(4,286
)
(7,729
)
(16,269
)
Accounts payable
4,754
314
4,514
1,258
Accrued expenses
2,707
340
(4,142
)
(6,253
)
Operating lease liabilities
(7,329
)
(4,505
)
(19,341
)
(16,937
)
Other liabilities
(3,789
)
1,033
(4,942
)
6,452
Net cash provided by (used in)
operating activities
5,002
(8,390
)
11,186
7,739
Cash flows from investing
activities:
Purchases of marketable securities
(37,902
)
(73,091
)
(155,099
)
(73,091
)
Sales of marketable securities
—
1
—
775
Maturities of marketable securities
113,032
86,030
289,709
428,125
Advance payment for purchase of property
and equipment
—
—
(790
)
—
Purchases of property and equipment
(1,996
)
(325
)
(5,361
)
(8,283
)
Proceeds from sale of property and
equipment
—
13
24
49
Capitalized internal-use software
(6,818
)
(4,951
)
(20,492
)
(15,390
)
Net cash provided by investing
activities
66,316
7,677
107,991
332,185
Cash flows from financing
activities:
Cash paid for debt extinguishment
—
—
—
(196,934
)
Repayments of finance lease
liabilities
(3,296
)
(6,041
)
(12,404
)
(21,243
)
Payment of deferred consideration for
business acquisitions
—
—
(3,771
)
(4,393
)
Proceeds from exercise of vested stock
options
19
1,137
310
2,008
Proceeds from employee stock purchase
plan
2,168
2,222
6,083
7,009
Net cash used in financing
activities
(1,109
)
(2,682
)
(9,782
)
(213,553
)
Effects of exchange rate changes on cash,
cash equivalents, and restricted cash
109
(47
)
48
538
Net increase (decrease) in cash, cash
equivalents, and restricted cash
70,318
(3,442
)
109,443
126,909
Cash, cash equivalents, and restricted
cash at beginning of period
147,196
273,892
108,071
143,541
Cash, cash equivalents, and restricted
cash at end of period
217,514
270,450
217,514
270,450
Reconciliation of cash, cash
equivalents, and restricted cash as shown in the statements of cash
flows:
Cash and cash equivalents
217,514
270,300
217,514
270,300
Restricted cash, current
—
150
—
150
Total cash, cash equivalents, and
restricted cash
$
217,514
$
270,450
$
217,514
$
270,450
Free Cash Flow
(in thousands, unaudited)
Three months ended
September 30,
Nine months ended
September 30,
2024
2023
2024
2023
Net cash provided by (used in) operating
activities
$
5,002
$
(8,390
)
$
11,186
$
7,739
Capital expenditures(1)
(12,110
)
(11,304
)
(38,233
)
(44,867
)
Advance payment for purchase of property
and equipment(2)
—
—
(790
)
—
Free Cash Flow
$
(7,108
)
$
(19,694
)
$
(27,837
)
$
(37,128
)
__________
(1)
Capital expenditures are defined
as cash used for purchases of property and equipment, net of
proceeds from sale of property and equipment, capitalized
internal-use software and payments on finance lease obligations, as
reflected in our statement of cash flows.
(2)
In the nine months ended
September 30, 2024, we received $11.9 million of capital equipment
that was prepaid prior to the current quarter, as reflected in the
supplemental disclosure of our statement of cash flows.
Source: Fastly, Inc.
View source
version on businesswire.com: https://www.businesswire.com/news/home/20241106084057/en/
Investor Contact Vernon Essi, Jr. ir@fastly.com
Media Contact Spring Harris press@fastly.com
Fastly (NYSE:FSLY)
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