How come Fastly (NYSE: FSLY) share price dropped a lot? - Seedly
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Asked 2w ago

How come Fastly (NYSE: FSLY) share price dropped a lot?

People are talking about Fastly share price falling and I saw a lot of YouTube videos coming up. What happened to the company?

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I've been holding on to this for almost a year and got a shocked too. Went for a quick search and managed to find a quick summary from IG.

  • Expected its Q3 revenues to come in lower than previously guided.

  • Fastly lowered its third quarter total revenue guidance to between $70.0m to $71.0m. Previously the company had guided for total Q3 revenues of between $73.5m to $75.5m.

  • Management cited reduced usage from its largest customer (ByteDance’s TikTok) as a key driver in this reduction in expected Q3 revenue.

  • back-half of Q3 some of the company’s other customers recorded lower usage than previously forecast.

  • is set to report its complete third quarter earnings report on Wednesday, October 28, 2020.

TLDR; They overestimated their revenue for Q3 and did a quick adjustment to their revenue guidance.

On a personal note, I would still like to hold on to it for at least till after the US elections.

I am kind of afraid too. One reason being that the Tiktok incident in US may not be actually over. Another is that the business model that Fastly provide is not very unique in the market with the likes of Microsoft or Datagod. I think some brokers are citing a Sell rating too and at a price of $58-$70. This is definitely dangerous for us, holders.

One last factor to consider is also that with more people going back to 'normal' life, will people have time to spend on TikTok? That maybe something that Fastly overlook when they sees TikTok have an increasing usage over the months. ​​​

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