Is Fastly the Hidden AI Stock You Didn't Know You Needed to Buy?[Stocks](https://moneymorning.com/category/article/stocks/) # Is Fastly the Hidden AI Stock You Didn't Know You Needed to Buy?  by Rich Duprey  February 16, 2026  Share it: **Fastly** ( [FSLY](https://moneymorning.com/stocks/fsly/)) wowed the market on Thursday with a staggering 72% surge in its stock price, following the release of its record-breaking fourth-quarter earnings. This explosive gain underscores the market's enthusiasm for the edge cloud platform provider, which has been quietly positioning itself at the intersection of content delivery and emerging technologies. The earnings report highlighted Fastly's robust performance amid a challenging economic landscape, signaling a potential turnaround for the company that has long been viewed as an underdog in the tech sector. As artificial intelligence continues to evolve, Fastly's infrastructure is increasingly seen as essential for delivering fast, secure experiences. This momentum has investors rethinking whether FSLY is the overlooked gem in the AI ecosystem, ready to deliver substantial returns. ## Record-Breaking Results Fastly's Q4 results were impressive, with revenue reaching $172.6 million, a 23% increase year-over-year. This growth was driven by strong demand in both its core network services, up 19% to $130.8 million, and security offerings, which surged 32% to $35.4 million. The company achieved a record gross margin of 61.4% on a GAAP basis and 64% non-GAAP, reflecting improved operational efficiency and cost management. For the full year 2025, revenue totaled $624 million, up 15% from 2024, marking a significant acceleration in the latter half of the year. Importantly, 2025 represented Fastly's first profitable year ever on a non-GAAP basis, with the company swinging to positive adjusted earnings per share in the fourth quarter at $0.12, compared to a loss in the prior year. This milestone highlights the success of Fastly's strategic initiatives, including expansions in its customer base and product innovations. With over 600 enterprise customers and a net retention rate of 110%, the business is demonstrating resilience and scalability. Looking ahead, guidance for Q1 2026 projects revenue between $168 million and $174 million, with full-year expectations of $700 million to $720 million, suggesting continued momentum.  ## Powering the AI Future As AI transitions into a [more agentic phase](https://moneymorning.com/2026/01/07/heres-how-nebius-group-just-ensured-it-will-dominate-enterprise-ai/) – where autonomous agents interact dynamically with users and systems – Fastly's content delivery network (CDN) plays a pivotal role in speeding up and protecting websites and applications. By distributing content across a global network of servers, Fastly ensures rapid data delivery, minimizing delays that can hinder AI-driven experiences like real-time chatbots or personalized recommendations. At the heart of this is Fastly's edge computing platform, which reduces latency by placing data and application logic closer to end users. This proximity enables faster processing and decision-making, crucial for agentic AI that requires instantaneous responses. This capability not only enhances performance but also safeguards against malicious activities, positioning Fastly as a guardian of the AI ecosystem. With AI traffic contributing to revenue growth, Fastly is well-equipped to capitalize on the expanding demand for edge-enabled solutions. ## Bottom Line Following Thursday's 72% gain, Fastly's stock is now up 57% year-to-date and a remarkable 244% from its 52-week low. This rally reflects growing confidence in the company's trajectory. Wall Street analysts forecast 51% annual EPS growth over the next five years, and at current levels, FSLY trades at an attractive PEG ratio of 0.86, balancing its valuation with this robust growth potential. As a hidden AI stock leveraging edge computing for the agentic era, Fastly deserves a spot on every investor's radar. **Beat the market, without relying on brokers or biased institutions.** Email(Required) LinkedIn This field is for validation purposes and should be left unchanged. Subscribe By submitting your email address, you will receive a free subscription to _Money Morning!_ and occasional special offers from us and our affiliates. You can unsubscribe at any time and we encourage you to read more about our [Privacy Policy](https://moneymorning.com/privacy/). ## One moment, please: Processing your submission ###### More Trending Stories from Money Morning - [Anthropic Mauls CrowdStrike Again. Here's Why the Cybersecurity Stock Is a Buy](https://moneymorning.com/2026/02/25/anthropic-mauls-crowdstrike-again-heres-why-the-cybersecurity-stock-is-a-buy/) - [IonQ's Quantum Defense Breakthrough: Can a $151B SHIELD Win Ignite a Surge?](https://moneymorning.com/2026/02/25/ionqs-quantum-defense-breakthrough-can-a-151b-shield-win-ignite-a-surge/) - [Is Novo Nordisk's Brutal Sell-Off Really a Buying Opportunity?](https://moneymorning.com/2026/02/25/is-novo-nordisks-brutal-sell-off-really-a-buying-opportunity/) - [Nvidia's Deal With Meta Is Ringing Alarm Bells at Intel and AMD](https://moneymorning.com/2026/02/23/nvidias-deal-with-meta-is-ringing-alarm-bells-at-intel-and-amd/) - [Is This the Cheapest Stock In All the AI Universe?](https://moneymorning.com/2026/02/23/is-this-the-cheapest-stock-in-all-the-ai-universe/) Share it: ### Popular Articles ###### [IonQ's Quantum Defense Breakthrough: Can a $151B SHIELD Win Ignite a Surge?](https://moneymorning.com/2026/02/25/ionqs-quantum-defense-breakthrough-can-a-151b-shield-win-ignite-a-surge/) February 25, 2026 ###### [Is Novo Nordisk's Brutal Sell-Off Really a Buying Opportunity?](https://moneymorning.com/2026/02/25/is-novo-nordisks-brutal-sell-off-really-a-buying-opportunity/) February 25, 2026 ###### [Is This the Cheapest Stock In All the AI Universe?](https://moneymorning.com/2026/02/23/is-this-the-cheapest-stock-in-all-the-ai-universe/) February 23, 2026 ###### [Amazon Takes the Revenue Throne as Walmart Sales Jump Can't Keep Pace](https://moneymorning.com/2026/02/23/amazon-takes-the-revenue-throne-as-walmart-sales-jump-cant-keep-pace/) February 23, 2026 Notifications reCAPTCHA Recaptcha requires verification. [Privacy](https://www.google.com/intl/en/policies/privacy/) \- [Terms](https://www.google.com/intl/en/policies/terms/) protected by **reCAPTCHA** [Privacy](https://www.google.com/intl/en/policies/privacy/) \- [Terms](https://www.google.com/intl/en/policies/terms/)