Fastly (FSLY) Stock Crashes 30% on Weak Guidance, Analysts Slash PTs

February 17, 2022 8:00 AM EST
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Price: $14.44 -2.7%

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Shares of Fastly (NYSE: FSLY) tanked nearly 30% in premarket trading Thursday after the company reported better-than-expected Q4 2021 revenue but missed expectations on Q1 2022 guidance.

Fastly reported revenue of $97.7 million in the fourth quarter, up 18% YOY and topping the consensus estimates of $92.9 million.

Adjusted loss per share came to 10 cents in the period, compared to the loss per share of 16 cents expected by analysts. Adjusted EBITDA loss was reported at $3.51 million, up 3.4% YOY.

For Q1 2022, the cloud computing company said it expects revenue in the range of $97 million to $100 million, compared to the analyst consensus of $97.9 million. It expects adjusted loss per share between 13 cents and 15 cents, compared to the consensus estimates of loss per share of 14 cents.

For FY 2022, Fastly expects revenue in the range of $400 million to $410 million, missing the analyst consensus of $420.4 million. The company estimates adjusted loss per share between 50 cents and 60 cents, compared to the expected loss per share of 49 cents.

"We finished 2021 on a strong note with fourth quarter revenue of $97.7 million, exceeding the midpoint of our guidance range by 7% and demonstrating momentum after facing setbacks earlier in the year," said Joshua Bixby, CEO of Fastly.

Morgan Stanley Sanjit Singh cut the price target to $25.00 per share from the prior $43.00 following disappointing guidance.

“We also believe the slowdown in new customer add and in new enterprise customers suggests that there is some go-to market disruption at play as well that management is attempting to de-risk. With growth slowing, margins coming down and the company not yet FCF positive, we lower our price target,” Singh said in a client note.

By Senad Karaahmetovic | [email protected]

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