[ad_1]
Alexis Christoforous of Yahoo Finance and Joshua Bixby, CEO of Fastly, discuss the latest report on the company’s earnings and growth amid the pandemic.
Video transcript
ALEXIS CHRISTOFOROUS: Cloud computing service provider Fastly this week posted results that beat both up and down. But it was Fastly’s advice that left some investors a little disappointed. Fastly CEO Joshua Bixby is joining me now. Joshua, nice to see you again. Let’s start with the last quarter here. Quite impressive peak in income, up 40% year over year. Tell us what drove these results.
JOSHUA BIXBY: Yeah, thanks for inviting me. It’s an honor. These results were driven by the trends we all see. The Internet continues to grow. Security is essential for those who serve on the Internet. And the gains the industry saw in March, April and May continue. Habits have changed and people continue to use the Internet more and more. It was a great neighborhood. I am very proud of the team.
ALEXIS CHRISTOFOROUS: You say things have – behaviors have changed. Do you think this continues even after the pandemic, even after we got back to business as usual and things opened up? Are we still going to see the same kind of demand for all of these cloud and online services?
JOSHUA BIXBY: Yeah, that’s definitely how we feel. One of the beauties of globalization is that we see openings happening at different stages. So when you look at Israel, you look at some of the countries that are already starting to open up, you can see that the trends that we have seen have continued. One of the great advantages we have is that we serve those who have transformed themselves digitally and those who care deeply about this process. In a way, they are the innovators, the most innovative.
And so when you watch Shopifys or watch Slacks and people who are really on the cutting edge of innovation, we see this trend continuing. And we’ve seen it before, as the world returns to normal, we’ve seen it continue. So we are very optimistic about it.
ALEXIS CHRISTOFOROUS: Now, having said all of that, you are still issuing a weaker than expected forecast for the coming year. Why are you not as optimistic as Wall Street hoped?
JOSHUA BIXBY: Yeah, that’s a great question. I think we have always guided the same way. The principle for us is, we start the year. We’re a use-based business, so we see what we have and we commit to it. And as the year goes by, as we see more use and our assumption becomes true, we are able to readjust. And so we took the same approach as a public company and every year that we’ve been in, you know, in that seat. And that hasn’t changed this year.
ALEXIS CHRISTOFOROUS: What about what do you expect from Fastly’s new cutting edge services?
JOSHUA BIXBY: This is a very big area of growth. We are fundamentally at a turning point in the way the Internet is designed. For those of us who have been in this market for a long time, it really started with this kind of notion that everything would sit in a data center. And you would design on a web server, an application server, and a database server. What we are seeing now are primitives, these new blueprints on how organizations create websites and web applications and how they provide security. And that involves the edge.
So when you go to something like “The New York Times”, the edge, a collection of servers very close to you, probably in the city where you live, actually responds to your request. It is about whether you are a paying customer. This is to determine the personalization. And everything that makes the web such an incredibly unique platform, it’s all done now at the edge. We are therefore at the beginning of a revolution where developers are in the driver’s seat. They understand that speed and scale are important.
We all know that if we come across a website and it’s slow, we go somewhere else. So when people understand the value of speed and the closer we can get you to all of these critical processes, the faster it gets, but more importantly, or more importantly, the safer it is. The more we can take the wicked away from the crown jewels of organizations, the better.
ALEXIS CHRISTOFOROUS: You mentioned being global a moment ago. I know you just appointed a new director of revenue, Brett Shirk, who has extensive experience, I guess, in cloud computing. And one of the things he’s going to focus on is expanding your operations overseas. Can you tell us a bit about the goals?
JOSHUA BIXBY: Of course, the Internet market is global. And security is as important an issue outside of North America and Europe as it is inside. In fact, in some areas even more. Our objective is therefore to continue to develop on a global scale. We have a very strong presence. But we continue to see huge demand. So what you’ll see from Brett and the whole organization is an ongoing commitment to those parts of the world, where we have users who are – you’re looking at a country like India, for example, that’s integrates with the Internet, obtaining more connectivity.
The 5G revolution is very important in all of this. And what we do know from history is that the more connectivity we have in our phones or in our homes, the more internet we use. There is just a strong ratio that we have seen over 25 years. So we are looking for an explosion, which we have already seen, but which we will continue to see in Internet consumption all over the world.
ALEXIS CHRISTOFOROUS: And I want to talk to you for a moment about the stock. And I know that as a CEO, you can’t be obsessed with stock prices. I mean, it went up 250%. 100 or so from last year. But some analysts are mixed on the company. They actually point out that you have, in fact, underperformed some of your peers.
And at least one Oppenheimer analyst, who was bullish on the stock, should we say, who said it’s a buy, says that stock is relatively inexpensive compared to its peers. Do you think there is something investors lacking in the Fastly story that you would like to share with them?
JOSHUA BIXBY: I mean, as you know, I don’t control the stock price. What I control is how much our customers use and love us and the happiness of our employees. And I think on both fronts we are extremely strong. You know, we came out in the last quarter with 40% growth. If you look at last year, it was 45% growth. If you think about the growth of the large market, these numbers are incredible.
I would like to report a revenue retention rate of 99%. Our basic dollar net expansion in the 140% – I mean more. So what we are seeing is a driving force where customers love what we do. We have the most innovative customers in the world. And they keep using our product more and more. We believe in the long term that this is the recipe for success.
ALEXIS CHRISTOFOROUS: All right, we’re going to stay on that optimistic note. Joshua Bixby, CEO of Fastly, nice to see you.
[ad_2]
Source link