• Akamai plans to use part of the offering proceeds to address existing convertible debt maturing in September 2027.
• Baird lowered its price target to $92 from $140, maintaining a ‘Neutral’ rating as attention shifts to cloud infrastructure in 2027.
• Akamai’s Cloud Infrastructure Services revenue grew 34% in the fiscal third quarter.

Akamai Technologies (AKAM) announced a proposed $2.2 billion convertible senior notes offering on Monday, planning to use the proceeds to refinance existing debt and fund its expanding cloud infrastructure business.

The offering comprises $1.1 billion in notes due in 2028 and another $1.1 billion due in 2031. The company also plans to give initial purchasers the option to buy an additional $300 million across the two series.
The interest rates and conversion terms for the notes are yet to be determined. 

At the time of writing, AKAM stock was down over 7% in the pre-market session and was among the trending tickers on Stocktwits.

How Akamai Plans To Use The Proceeds

Akamai intends to use the net proceeds, after certain transaction costs, to repay a portion of its $1.15 billion outstanding convertible notes due in September 2027 and fund capital expenditures for its Cloud Infrastructure Services (CIS) business.

The company intends to use any remaining net proceeds for general corporate purposes. It also plans hedging transactions to reduce potential shareholder dilution from the convertible notes, although related warrants could separately be dilutive.

Baird Cuts Akamai Price Target

Baird lowered its price target on Akamai to $92 from $140 while maintaining a ‘Neutral’ rating, according to TheFly. The firm updated its financial model following Akamai's third-quarter results as investor attention shifts toward the company's CIS business in 2027.

Akamai reported third-quarter revenue of $1.12 billion, up 6% year over year, driven by growth in security and cloud infrastructure. CIS revenue increased 34% to $109 million, while security revenue rose 9% to $622 million.

CEO Tom Leighton highlighted more than $14 billion in multiyear CIS commitments signed so far in 2026, including a seven-year, $11.6 billion agreement with Anthropic (ANT).

Akamai Sees Cloud Revenue Doubling In 2027

Akamai management expects CIS revenue to more than double to $1.1 billion to $1.3 billion in 2027, with company-wide revenue growth accelerating to 17% to 22% year over year, adjusted for foreign exchange.

The cloud computing and cybersecurity company also projects total revenue exceeding $7 billion in 2028.

On the earnings call, CEO Leighton said two of the company's first three large CIS deals were generating revenue, with the third expected to begin contributing in the fourth quarter.

Retail Investors’ Sentiment Around AKAM Stock

On Stocktwits, retail investors’ sentiment around AKAM stock remained ‘bullish’ amid high message volume.

So far this year, AKAM stock has fallen over 2%. In comparison, the First Trust NASDAQ Cybersecurity ETF (CIBR), which holds the stock, has risen more than 28% over the same period.

See Also: El-Erian Says US Midterm Winners Face Market Test — Warns Against Stifling AI, Urges Fiscal Discipline

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