Akamai Technologies shares surged more than 20% in premarket trading Friday after the company unveiled a major cloud infrastructure agreement with artificial intelligence firm Anthropic. The seven-year contract is valued at $11.6 billion, with an option to expand by another $9 billion, potentially bringing the total commitment to roughly $20 billion.
As part of the deal, Akamai granted Anthropic warrants representing up to 5% of its shares outstanding at an exercise price of $111.33. Approximately 2% of the warrants are expected to vest immediately, while the remaining 3% depend on Anthropic making the additional $9 billion in cloud purchases over the seven-year term.
The agreement is expected to produce no revenue this year, roughly $150 million to $300 million in 2027, and eventually about $1.7 billion annually. Akamai plans around $5.5 billion in capital expenditures to support the deal, including $1.7 billion this year. CFO Edward McGowan said the company has $4.6 billion in cash and another $1 billion in bank lending commitments, but did not rule out additional financing.
Wall Street analysts reacted with higher price targets. Guggenheim lifted its target to $225 from $190, implying more than 100% upside. Morgan Stanley estimated operating margins near 30% and highlighted Akamai’s use of CPUs rather than GPUs as an advantage for AI workloads. JPMorgan described the $9 billion expansion option as having “a path of low resistance,” while TD Cowen noted the contract underscores the continued scarcity of computing capacity in the AI infrastructure cycle.
Broader chip and AI-related stocks also gained. Advanced Micro Devices rose about 2.5% and crossed a $1 trillion market value for the first time, Intel gained close to 2%, Marvell Technology rose more than 2%, and Nvidia added less than 1%. Energy stocks moved lower as Brent crude futures fell 1.6% to $98.55 per barrel, with Marathon Petroleum, Phillips 66, ConocoPhillips, Exxon Mobil, and Chevron each down more than 1%.
Elsewhere, People Inc. rose more than 8% on reports that MGM Resorts may bid for the company, Select Water Solutions gained about 6% after agreeing to buy Pilot Water Solutions for $700 million in cash and stock, and Fathom Holdings and Neighborhood Intelligence advanced after announcing they would explore a new deal structure involving digital assets tied to tZERO Group. Scholastic fell 12% after wider-than-expected quarterly losses, while Zscaler dropped 4% after naming a new Chief Revenue Officer.
Stock futures pointed higher early Friday, while bond yields pulled back from 19-year highs and oil prices dipped below $100 a barrel.
