🕒 A Quick Drop For Fastly

FSLY Stock craters over 25% in pre-market trading

Hey Global Investor, here’s what you need to know before the US markets open.

Market Snapshot 📈

S&P 500 (Wednesday Close) 3,488.67 −23.26 (0.66%)

NASDAQ (Wednesday Close) 11,768.73 −95.17 (0.80%)

FTSE 100 (5 PM IST) 5830.65 -104.41 (-1.75%)

NIFTY 50 (Today’s Close) 11,680.35 −290.70 (2.43%)

USDINR (5 PM IST) 73.44 (1 Year +2.51%)

A Quick Drop For Fastly

Lower-than-expected usage from its largest client forced Fastly to qualify its earlier annual revenue guidance as unreliable. Its stock dropped 25% in after-hours trading.

Background: Fastly’s technology is behind companies delivering digital content to their consumers. The company helps speed up e-commerce transactions, business software downloads, and video streaming to mobile devices. Fastly’s next-generation content delivery network is designed to accelerate and secure enterprise websites.

What Happened? ByteDance had accounted for 12% of Fastly’s revenue in the first six months of the year, making TikTok’s parent its largest customer. CEO Joshua Bixby revealed as much in the most recent earnings call. He also blamed the uncertain geopolitical environment for weaker-than-expected usage from a few of its clients.

Fastly also issued a Q3 sales warning, and revised its Q3 revenue expectations from about $74.5M to about $70.5M. The company also said its current revenue expectation for the full year is not to be relied upon. In its earnings call scheduled for Oct 28th, Fastly will also issue revised full-year revenue guidance in light of the current situation.

Its stock, which had soared 30% in just the past two weeks cratered in pre-market trading, losing 29.38% at the time of this writing. The uncertain environment Bixby was alluding to is the run-in ByteDance has been having with the Trump administration over data privacy. The unknowns are too many in how the TikTok-Oracle-Walmart saga will play out. Fastly has turned out to be collateral damage in this roller coaster ride, at least for now.

Market reaction: As of Wednesday’s close, Fastly shares were up 514% YTD, only behind Zoom, which is up 648% YTD. Its stock closed with a 4.39% decline at $123.18 on Wednesday. It is currently trading around the $87 mark before-hours.

Company Snapshot 📈

FSLY $123.18 -5.65 (-4.39%)

Analyst Rating (12 Ratings) BUY 58%  HOLD 25%  SELL 17%

Newsworthy 📰

  • New Features: Zoom Video adds online events, apps to service (ZM -1.84%)
  • Unethical Behavior: Wells Fargo fires more than 100 workers over alleged pandemic-relief fraud (WFC -6.02%)
  • Big Loss: United Airlines posts $1.8 billion net loss in pandemic slump, cuts cash burn (UAL +0.99%)

Later Today 🕒

  • 6.00 PM IST: Initial jobless claims (regular state program, SA)
  • 6.00 PM IST: Continuing jobless claims (regular state program, SA)
  • Before Market Open: Home BancShares Inc (HOMB) Earnings
  • Before Market Open: Signature Bank (SBNY) Earnings
  • Before Market Open: Honeywell International Inc (HON) Earnings

“Fun Fact of The Day” 🌞

An ant’s sense of smell is stronger than a dog.

Disclaimer: The content of this article has been created and published by Winvesta India Technologies Pvt. Ltd., in order to ease the reader’s understanding of the subject matter. The information and/or content (collectively “Information”) provided herein is general information sourced through various news reports and does not constitute a research report or a research analysis. The Information is not intended to offer advice, target or solicit any particular customer or group of customers to buy or sell securities. 

Winvesta does not render any research or advisory services and provides a more detailed description of its services on its website and mobile application along with the terms and conditions published therein from time to time. While reasonable care has been exercised to ensure that the Information is adequate and reliable, no representation is made by Winvesta as to its accuracy or completeness and Winvesta, its affiliates, subsidiaries and employees accept no liability of whatsoever nature for any direct or consequential loss, including without limitation any loss of profits, arising from reliance on this Information. Neither Winvesta nor any of its affiliates are acting as an investment adviser, research analyst or in any other fiduciary capacity. Accordingly, reader’s are expected to undertake their own due diligence in consultation with their own advisors and are advised not to solely rely on the Information. Any such reliance shall be at the reader’s own risk. 

All investments involve risk and the past performance of a security, or financial product does not guarantee future results or returns. There is always the potential of losing money when you invest in securities, or other financial products. Investors should consider their investment objectives and risks carefully before investing.

Start Building Your Global Portfolio Today

Download Winvesta App now to Get Started