EX-99.1 2 ex991-fslypressrelease1231.htm EX-99.1 Document

Exhibit 99.1
Fastly Announces Fourth Quarter and Full Year 2023 Financial Results
Company reports record fourth quarter revenue of $137.8 million

SAN FRANCISCO — February 14, 2024 — Fastly, Inc. (NYSE: FSLY), one of the world’s fastest edge cloud platforms, today announced financial results for its fourth quarter and full year ended December 31, 2023.
“This quarter demonstrated the progress we’ve made in operational and financial rigor resulting in strong gross margins and non-GAAP net income,” said Todd Nightingale, CEO of Fastly.
“Our go-to-market, packaging and channel efforts through 2023 delivered an inflection in our customer acquisition as we closed out the year,” continued Nightingale. “This positions us well for 2024, driving our mission to make every user experience fast, safe, and engaging.”


Three months ended
December 31,		Year ended
December 31,
2023202220232022
Revenue$137,777 $119,321 $505,988 $432,725 
Gross margin
GAAP gross margin55.0 %52.4 %52.6 %48.5 %
Non-GAAP gross margin59.2 %57.0 %56.9 %53.6 %
Operating loss
GAAP operating loss$(42,584)$(48,462)$(198,028)$(246,199)
Non-GAAP operating loss$(2,268)$(11,994)$(36,679)$(76,468)
Net loss per share
GAAP net loss per common share—basic and diluted$(0.18)$(0.38)$(1.03)$(1.57)
Non-GAAP net income (loss) per common share—basic and diluted
$0.01 $(0.08)$(0.17)$(0.59)
For a reconciliation of non-GAAP financial measures to their corresponding GAAP measures, please refer to the reconciliation table at the end of this press release.
Fourth Quarter 2023 Financial Summary
•Total revenue of $137.8 million, representing 15% year-over-year growth and 8% sequential increase.
•GAAP gross margin of 55.0%, compared to 52.4% in the fourth quarter of 2022. Non-GAAP gross margin of 59.2%, compared to 57.0% in the fourth quarter of 2022.
•GAAP net loss of $23.4 million, compared to $46.7 million in the fourth quarter of 2022. Non-GAAP net income of $1.7 million, compared to non-GAAP net loss of $9.5 million in the fourth quarter of 2022.
•GAAP net loss per basic and diluted shares of $0.18 compared to $0.38 in the fourth quarter of 2022. Non-GAAP net income per basic and diluted shares of $0.01, compared to non-GAAP net loss per basic and diluted shares of $0.08 in the fourth quarter of 2022.
Full Year 2023 Financial Summary
•Total revenue of $506.0 million, representing 17% growth year-over-year.
•GAAP gross margin of 52.6%, compared to 48.5% in fiscal 2022. Non-GAAP gross margin of 56.9%, compared to 53.6% in fiscal 2022.
•GAAP net loss of $133.1 million, compared to $190.8 million in fiscal 2022. Non-GAAP net loss of $21.7 million, compared to $72.3 million in fiscal 2022.
•GAAP net loss per basic and diluted shares of $1.03 compared to $1.57 in fiscal 2022. Non-GAAP net loss per basic and diluted shares of $0.17, compared to $0.59 in fiscal 2022.




Key Metrics
•12-month net retention rate (LTM NRR)1 decreased to 113% in the fourth quarter from 114% in the third quarter.
•Total customer count2 was 3,243 in the fourth quarter, up 141 from the third quarter; 578 were enterprise customers2 in the fourth quarter, up 31 from the third quarter.
•Average enterprise customer spend3 of $880 thousand in the fourth quarter, up 3% quarter-over-quarter.
•Annual revenue retention rate (ARR)7 was 99.2% in 2023, increasing from 98.9% in 2022.
•Remaining performance obligations (RPO)4 were $245 million, down 1% from $248 million in the third quarter of 2023 and up 24% from $198 million in the fourth quarter of 2022.

Fourth Quarter Business and Product Highlights
•Fastly was named a Leader in The Forrester Wave™: Edge Development Platforms, Q4 2023 report, highlighted by Fastly’s Compute platform receiving the highest rating possible (5/5) in 22 criteria.
•Kip Compton joined Fastly as Chief Product Officer, bringing over 25 years of senior leadership experience driving innovation, most recently as SVP of Strategy at Cisco Networking where he led teams responsible for strategy, portfolio management, investments and acquisitions.
•Repurchased $130.9 million of our convertible notes’ principal balance in the fourth quarter for $113.6 million in cash or approximately 87 cents on the dollar.
•Channel partner deal registration continues to expand as our 2023 deal registration more than tripled 2022 levels and we grew our partner engagement by over 65%.
•Our packaging motion is accelerating as more customers purchased package deals in the fourth quarter of 2023 than the first nine months of 2023 combined.
•Launched our new annual global cybersecurity report, The Race to Adapt, uncovering the impacts of cyber attacks on leading businesses across the globe and how 76% of the businesses surveyed plan to increase their cybersecurity budgets in the next year.
•Released multiple new features to Fastly’s Next-Gen WAF solution to improve performance and simplify the user experience, including Hashicorp Vault Integration, Agent Auto-Update, WAF Simulator, New Anomaly Signal: Out-of-Band Domain, and Simplified Attack Signal Thresholds.
•Released our new observability page, allowing customers to monitor their Fastly Delivery and Compute services via metrics and logs within customizable dashboards.
•Released our Bot Mitigation solution in limited availability to select customers.

First Quarter and Full Year 2024 Guidance

Q1 2024
Full Year 2024
Total Revenue (millions)$131 - $135$580 - $590
Non-GAAP Operating Loss (millions)($14.0) - ($10.0)($20.0) - ($14.0)
Non-GAAP Net Income (Loss) per share (5)(6)
($0.09) - ($0.05)($0.06) - $0.00
A reconciliation of non-GAAP guidance measures to corresponding GAAP measures is not available on a forward-looking basis without unreasonable effort due to the uncertainty of expenses that may be incurred in the future and cannot be reasonably determined or predicted at this time, although it is important to note that these factors could be material to Fastly’s future GAAP financial results.

Conference Call Information

Fastly will host an investor conference call to discuss its results at 1:30 p.m. PT / 4:30 p.m. ET on Wednesday, February 14, 2024.

Date: Wednesday, February 14, 2024
Time: 1:30 p.m. PT / 4:30 p.m. ET




Webcast: https://investors.fastly.com
Dial-in: 888-330-2022 (US/CA) or 646-960-0690 (Intl.)
Conf. ID#: 7543239

Please dial in at least 10 minutes prior to the 1:30 p.m. PT start time. A live webcast of the call will be available at https://investors.fastly.com where listeners may log on to the event by selecting the webcast link under the “Quarterly Results” section.

A telephone replay of the conference call will be available at approximately 5:00 p.m. PT, February 14 through February 28, 2024 by dialing 800-770-2030 or 647-362-9199 and entering the passcode 7543239.



About Fastly, Inc.
Fastly’s powerful and programmable edge cloud platform helps the world’s top brands deliver some of the best online experiences possible through edge compute, delivery, security, and observability offerings improving site performance, enhancing security, and empowering innovation at global scale. Compared to legacy providers, Fastly’s powerful and modern network architecture is one of the fastest on the planet, empowering developers to deliver secure websites and apps with rapid time-to-market and industry-leading cost savings. Organizations around the world trust Fastly to help them upgrade the internet experience, including Reddit, Wendy’s, Stripe, Neiman Marcus, Universal Music Group, SeatGeek, and Advance Publications. Learn more about Fastly at https://www.fastly.com, and follow us @fastly.

Forward-Looking Statements

This press release contains “forward-looking” statements that are based on our beliefs and assumptions and on information currently available to us on the date of this press release. Forward-looking statements may involve known and unknown risks, uncertainties, and other factors that may cause our actual results, performance, or achievements to be materially different from those expressed or implied by the forward-looking statements. These statements include, but are not limited to, statements regarding our future financial and operating performance, including our outlook and guidance, our operating performance, our ability to innovate, our customer acquisition and go-to-market efforts, our ability to monetize, and our ability to deliver on our long-term strategy. Except as required by law, we assume no obligation to update these forward-looking statements publicly or to update the reasons actual results could differ materially from those anticipated in the forward-looking statements, even if new information becomes available in the future. Important factors that could cause our actual results to differ materially are detailed from time to time in the reports Fastly files with the Securities and Exchange Commission (“SEC”), including in our Quarterly Report on Form 10-Q for the fiscal quarter ended September 30, 2023. Additional information will also be set forth in our Annual Report on Form 10-K for the fiscal year ended December 31, 2023. Copies of reports filed with the SEC are posted on Fastly’s website and are available from Fastly without charge.
Use of Non-GAAP Financial Measures
To supplement our condensed consolidated financial statements, which are prepared and presented in accordance with accounting principles generally accepted in the United States ("GAAP"), the Company uses the following non-GAAP measures of financial performance: non-GAAP gross profit, non-GAAP gross margin, non-GAAP operating loss, non-GAAP net income (loss), non-GAAP basic and diluted net income (loss) per common share, non-GAAP research and development, non-GAAP sales and marketing, non-GAAP general and administrative, free cash flow and adjusted EBITDA. The presentation of this additional financial information is not intended to be considered in isolation from, as a substitute for, or superior to, the financial information prepared and presented in accordance with GAAP. These non-GAAP measures have limitations in that they do not reflect all of the amounts associated with our results of operations as determined in accordance with GAAP. In addition, these non-GAAP financial measures may be different from the non-GAAP financial measures used by other companies. These non-GAAP measures should only be used to evaluate our results of operations in conjunction with the corresponding GAAP measures. Management compensates for these limitations by reconciling these non-GAAP financial measures to the most comparable GAAP financial measures within our earnings releases.
Non-GAAP gross profit, non-GAAP gross margin, non-GAAP operating loss, non-GAAP net income (loss) and non-GAAP basic and diluted net income (loss) per common share, non-GAAP research and development, non-GAAP sales and marketing, and non-GAAP general and administrative differ from GAAP in that they exclude stock-based compensation expense, amortization of acquired intangible assets, acquisition-related expenses, executive transition costs, net gain on extinguishment of debt, impairment expense and amortization of debt discount and issuance costs.





Adjusted EBITDA: excludes stock-based compensation expense, depreciation and other amortization expenses, amortization of acquired intangible assets, acquisition-related expenses, executive transition costs, interest income, interest expense, including amortization of debt discount and issuance costs, net gain on extinguishment of debt, impairment expense, other income (expense), net, and income taxes.

Acquisition-Related Expenses: consists of acquisition-related charges that are not related to ongoing operations. Management considers its operating results without this activity when evaluating its ongoing non-GAAP net income (loss) performance and its adjusted EBITDA performance because these charges may not be reflective of our core business, ongoing operating results, or future outlook.

Amortization of Acquired Intangible Assets: consists of non-cash charges that can be affected by the timing and magnitude of asset purchases and acquisitions. Management considers its operating results without this activity when evaluating its ongoing non-GAAP performance and its adjusted EBITDA performance because these charges are non-cash expenses that can be affected by the timing and magnitude of asset purchases and acquisitions and may not be reflective of our core business, ongoing operating results, or future outlook.

Amortization of Debt Discount and Issuance Costs: consists primarily of amortization expense related to our debt obligations. Management considers its operating results without this activity when evaluating its ongoing non-GAAP net income (loss) performance and its adjusted EBITDA performance because it is not believed by management to be reflective of our core business, ongoing operating results or future outlook. These are included in our total interest expense.

Capital Expenditures: consists of cash used for purchases of property and equipment, net of proceeds from sale of property and equipment, capitalized internal-use software and payments on finance lease obligations, as reflected in our statement of cash flows.

Depreciation and Other Amortization Expense: consists of non-cash charges that can be affected by the timing and magnitude of asset purchases. Management considers its operating results without this activity when evaluating its ongoing adjusted EBITDA performance because these charges are non-cash expenses that can be affected by the timing and magnitude of asset purchases and may not be reflective of our core business, ongoing operating results, or future outlook.

Executive Transition Costs: consists of one-time cash and non-cash charges recognized with respect to changes in our executives' employment status. Management considers its operating results without this activity when evaluating its ongoing non-GAAP net income (loss) performance and its adjusted EBITDA performance because it is not believed by management to be reflective of our core business, ongoing operating results or future outlook.

Free Cash Flow: calculated as net cash used in operating activities less purchases of property and equipment, net of proceeds from sale of property and equipment, principal payments of finance lease liabilities, capitalized internal-use software costs and advance payments made related to capital expenditures. Management specifically identifies adjusting items in the reconciliation of GAAP to non-GAAP financial measures. Management considers non-GAAP free cash flow to be a profitability and liquidity measure that provides useful information to management and investors about the amount of cash generated by the business that can possibly be used for investing in Fastly's business and strengthening its balance sheet, but it is not intended to represent the residual cash flow available for discretionary expenditures. The presentation of non-GAAP free cash flow is also not meant to be considered in isolation or as an alternative to cash flows from operating activities as a measure of liquidity.
Impairment Expense: consists of impairment charge related to our computer and networking equipment, including software, we expect to not be used. Management considers its operating results without this activity when evaluating its ongoing non-GAAP net income (loss) performance and its adjusted EBITDA performance because it is not believed by management to be reflective of our core business, ongoing operating results or future outlook.
Income Taxes: consists primarily of expenses recognized related to state and foreign income taxes. Management considers its operating results without this activity when evaluating its ongoing adjusted EBITDA performance because it is not believed by management to be reflective of our core business, ongoing operating results or future outlook.
Interest Expense: consists primarily of interest expense related to our debt instruments, including amortization of debt discount and issuance costs. Management considers its operating results without this activity when evaluating its ongoing non-GAAP net income (loss) performance and its adjusted EBITDA performance because it is not believed by management to be reflective of our core business, ongoing operating results or future outlook.




Interest Income: consists primarily of interest income related to our marketable securities. Management considers its operating results without this activity when evaluating its ongoing non-GAAP net income (loss) performance and its adjusted EBITDA performance because it is not believed by management to be reflective of our core business, ongoing operating results or future outlook.
Net Gain on Debt Extinguishment: relates to net gain on the partial repurchase of our outstanding convertible debt. Management considers its operating results without this activity when evaluating its ongoing non-GAAP net income (loss) performance and its adjusted EBITDA performance because it is not believed by management to be reflective of our core business, ongoing operating results or future outlook.
Other Income (Expense), Net: consists primarily of foreign currency transaction gains and losses. Management considers its operating results without this activity when evaluating its ongoing adjusted EBITDA performance because it is not believed by management to be reflective of our core business, ongoing operating results or future outlook.
Stock-Based Compensation Expense: consists of expenses for stock options, restricted stock units, performance awards, restricted stock awards and Employee Stock Purchase Plan ("ESPP") under our equity incentive plans. Although stock-based compensation is an expense for the Company and is viewed as a form of compensation, management considers its operating results without this activity when evaluating its ongoing non-GAAP net income (loss) performance and its adjusted EBITDA performance, primarily because it is a non-cash expense not believed by management to be reflective of our core business, ongoing operating results, or future outlook. In addition, the value of some stock-based instruments is determined using formulas that incorporate variables, such as market volatility, that are beyond our control.
Management believes these non-GAAP financial measures and adjusted EBITDA serve as useful metrics for our management and investors because they enable a better understanding of the long-term performance of our core business and facilitate comparisons of our operating results over multiple periods and to those of peer companies, and when taken together with the corresponding GAAP financial measures and our reconciliations, enhance investors' overall understanding of our current financial performance.
In the financial tables below, the Company provides a reconciliation of the most comparable GAAP financial measure to the historical non-GAAP financial measures used in this press release.
Key Metrics
1 We calculate LTM Net Retention Rate by dividing the total customer revenue for the prior twelve-month period (“prior 12-month period”) ending at the beginning of the last twelve-month period (“LTM period”) minus revenue contraction due to billing decreases or customer churn, plus revenue expansion due to billing increases during the LTM period from the same customers by the total prior 12-month period revenue. We believe the LTM Net Retention Rate is supplemental as it removes some of the volatility that is inherent in a usage-based business model.
2 Under our new methodology, our number of customers is calculated based on the number of separate identifiable operating entities with which we have a billing relationship in good standing, from which we recognized revenue during the current quarter. Under our prior methodology, our number of customers is calculated based on the number of separate identifiable operating entities with which we have a billing relationship in good standing, from which we recognized revenue during the last month of the quarter. Under our new methodology, our enterprise customers are defined as those with annualized current quarter revenue in excess of $100,000. This is calculated by taking the revenue for each customer within the quarter and multiplying it by four. Under our prior methodology, our enterprise customers are defined as those with revenue in excess of $100,000 in the trailing 12-month period. Under our prior methodology, our total customer count was 3,097 in the fourth quarter, up 78 from the third quarter of 2023; 532 were enterprise customers in the fourth quarter, up 2 from the third quarter of 2023.
3 Under our new methodology, our average enterprise customer spend is calculated by taking the annualized current quarter revenue contributed by enterprise customers existing as of the current period, and dividing that by the number of enterprise customers as of the current period. Under our prior methodology, our average enterprise customer spend is calculated by taking the sum of the trailing 12-month revenue contributed by enterprise customers existing as of the current period, and dividing that by the number of enterprise customers as of the current period. Under our prior methodology, our average enterprise customer spend was $859 thousand in the fourth quarter, up 3% quarter-over-quarter.
4 Remaining performance obligations include future committed revenue for periods within current contracts with customers, as well as deferred revenue arising from consideration invoiced for which the related performance obligations have not been satisfied.




5 Non-GAAP net income (loss) per basic share is calculated as Non-GAAP net income (loss) divided by weighted average basic shares for 2024.
6 Assumes weighted average basic shares outstanding of 134.3 million in Q1 2024 and 137.5 million for the full year 2024.
7 Annual Revenue Retention rate is calculated by first calculating "Annual Revenue Churn", which is calculated by multiplying the final full month of revenue from a customer that terminated its contract with us, (a "Churned Customer") by the number of months remaining in the same calendar year. Our ARR rate is calculated by subtracting the quotient of the Annual Revenue Churn from all of our Churned Customers from which we recognized revenue during the last quarter of the prior year divided by our annual revenue of the same calendar year from 100%. Under the prior methodology, our ARR rate is calculated by subtracting the quotient of the Annual Revenue Churn from all of our Churned Customers from which we recognized revenue during the last month of the prior year divided by our annual revenue of the same calendar year from 100%. Under our prior methodology, our ARR was 99.1%, down 0.1% year-over-year.

Condensed Consolidated Statements of Operations
(in thousands, except per share amounts, unaudited)

Three months ended
December 31,		Year ended
December 31,
2023202220232022
Revenue$137,777 $119,321 $505,988 $432,725 
Cost of revenue(1)
62,003 56,738 239,660 222,944 
Gross profit75,774 62,583 266,328 209,781 
Operating expenses:
Research and development(1)
38,270 37,197 152,190 155,308 
Sales and marketing(1)
48,662 44,623 191,773 179,869 
General and administrative(1)
31,426 29,225 116,077 120,803 
Impairment expense
— — 4,316 — 
Total operating expenses
118,358 111,045 464,356 455,980 
Loss from operations(42,584)(48,462)(198,028)(246,199)
Net gain on extinguishment of debt15,656 — 52,416 54,391 
Interest income4,584 2,894 18,186 7,044 
Interest expense(744)(1,354)(4,051)(5,887)
Other income (expense)(763)46 (1,832)(29)
Loss before income taxes(23,851)(46,876)(133,309)(190,680)
Income tax expense (benefit)(465)(223)(221)94 
Net loss$(23,386)$(46,653)$(133,088)$(190,774)
Net income (loss) per share attributable to common stockholders, basic and diluted$(0.18)$(0.38)$(1.03)$(1.57)
Weighted-average shares used in computing net income (loss) per share attributable to common stockholders, basic and diluted131,843 123,587 128,770 121,723 

__________

(1)Includes stock-based compensation expense as follows:
Three months ended
December 31,		Year ended
December 31,
2023202220232022
Cost of revenue$3,278 $2,938 $11,656 $12,050 
Research and development12,019 11,469 47,827 58,435 
Sales and marketing8,060 7,885 33,703 39,083 
General and administrative12,090 9,126 43,117 36,228 
Total$35,447 $31,418 $136,303 $145,796 




Reconciliation of GAAP to Non-GAAP Financial Measures
(in thousands, unaudited)
Three months ended
December 31,		Year ended
December 31,
2023202220232022
Gross Profit
GAAP gross profit$75,774 $62,583 $266,328 $209,781 
Stock-based compensation3,278 2,938 11,656 12,050 
Amortization of acquired intangible assets2,475 2,475 9,900 9,900 
Non-GAAP gross profit$81,527 $67,996 $287,884 $231,731 
GAAP gross margin55.0 %52.4 %52.6 %48.5 %
Non-GAAP gross margin59.2 %57.0 %56.9 %53.6 %
Research and development
GAAP research and development$38,270 $37,197 $152,190 $155,308 
Stock-based compensation(11,728)(11,469)(45,840)(58,435)
Executive transition costs(385)— (2,791)— 
Non-GAAP research and development$26,157 $25,728 $103,559 $96,873 
Sales and marketing
GAAP sales and marketing$48,662 $44,623 $191,773 $179,869 
Stock-based compensation(8,060)(7,885)(33,703)(39,083)
Amortization of acquired intangible assets(2,300)(2,575)(10,026)(10,891)
Non-GAAP sales and marketing$38,302 $34,163 $148,044 $129,895 
General and administrative
GAAP general and administrative$31,426 $29,225 $116,077 $120,803 
Stock-based compensation(12,090)(9,126)(43,117)(33,195)
Executive transition costs— — — (4,207)
Acquisition-related expenses— — — (1,970)
Non-GAAP general and administrative$19,336 $20,099 $72,960 $81,431 
Operating loss
GAAP operating loss$(42,584)$(48,462)$(198,028)$(246,199)
Stock-based compensation35,156 31,418 134,316 142,763 
Executive transition costs385 — 2,791 4,207 
Amortization of acquired intangible assets4,775 5,050 19,926 20,791 
Impairment expense— — 4,316 — 
Acquisition-related expenses— — — 1,970 
Non-GAAP operating loss$(2,268)$(11,994)$(36,679)$(76,468)
Net loss
GAAP net loss$(23,386)$(46,653)$(133,088)$(190,774)
Stock-based compensation35,156 31,418 134,316 142,763 
Executive transition costs385 — 2,791 4,207 
Amortization of acquired intangible assets4,775 5,050 19,926 20,791 
Acquisition-related expenses— — — 1,970 
Net gain on extinguishment of debt(15,656)— (52,416)(54,391)
Impairment expense— — 4,316 — 
Amortization of debt discount and issuance costs456 716 2,477 3,169 
Non-GAAP income (loss)$1,730 $(9,469)$(21,678)$(72,265)
Non-GAAP net income (loss) per common share—basic and diluted$0.01 $(0.08)$(0.17)$(0.59)
Weighted average basic common shares131,843123,587128,770121,723
Weighted average diluted common shares141,162123,587128,770121,723





Reconciliation of GAAP to Non-GAAP Financial Measures
(in thousands, unaudited) (continued)
Three months ended
December 31,		Year ended
December 31,
2023202220232022
Reconciliation of GAAP to Non-GAAP diluted shares
GAAP diluted shares
131,843 123,587 128,770 121,723 
Other dilutive equity awards
9,319 — — — 
Non-GAAP diluted shares
141,162 123,587 128,770 121,723 
Non-GAAP diluted net income (loss) per share
0.01 (0.08)(0.17)(0.59)


Three months ended
December 31,		Year ended
December 31,
2023202220232022
Adjusted EBITDA
GAAP net loss$(23,386)$(46,653)$(133,088)$(190,774)
Stock-based compensation35,156 31,418 134,316 142,763 
Executive transition costs385 — 2,791 4,207 
Net gain on extinguishment of debt(15,656)— (52,416)(54,391)
Impairment expense
— — 4,316 — 
Acquisition-related expenses— — — 1,970 
Depreciation and other amortization13,727 11,903 52,139 43,524 
Amortization of acquired intangible assets4,775 5,050 19,926 20,791 
Amortization of debt discount and issuance costs456 716 2,477 3,169 
Interest income(4,584)(2,894)(18,186)(7,044)
Interest expense288 638 1,574 2,718 
Other expense (income)
763 (46)1,832 29 
Income tax expense (benefit)
(465)(223)(221)94 
Adjusted EBITDA$11,459 $(91)$15,460 $(32,944)




Condensed Consolidated Balance Sheets
(in thousands)
As of
December 31, 2023		As of
December 31, 2022
(unaudited)
(audited)
ASSETS
Current assets:
Cash and cash equivalents$107,921 $143,391 
Marketable securities, current214,799 374,581 
Accounts receivable, net of allowance for credit losses120,498 89,578 
Prepaid expenses and other current assets20,455 28,933 
Total current assets463,673 636,483 
Property and equipment, net176,608 180,378 
Operating lease right-of-use assets, net55,212 68,440 
Goodwill670,356 670,185 
Intangible assets, net62,475 82,900 
Marketable securities, non-current6,088 165,105 
Other assets90,779 92,622 
Total assets$1,525,191 $1,896,113 
LIABILITIES AND STOCKHOLDERS’ EQUITY
Current liabilities:
Accounts payable$5,611 $4,786 
Accrued expenses61,818 61,161 
Finance lease liabilities, current15,684 28,954 
Operating lease liabilities, current24,042 23,026 
Other current liabilities40,539 34,394 
Total current liabilities147,694 152,321 
Long-term debt343,507 704,710 
Finance lease liabilities, non-current1,602 15,507 
Operating lease liabilities, non-current48,484 61,341 
Other long-term liabilities4,416 7,076 
Total liabilities545,703 940,955 
Stockholders’ equity:
Common stock3 2 
Additional paid-in capital1,815,245 1,666,106 
Accumulated other comprehensive loss(1,008)(9,286)
Accumulated deficit(834,752)(701,664)
Total stockholders’ equity 979,488 955,158 
Total liabilities and stockholders’ equity $1,525,191 $1,896,113 







Condensed Consolidated Statements of Cash Flows
(in thousands, unaudited)
Three months ended
December 31,		Year ended
December 31,
2023202220232022
Cash flows from operating activities:
Net loss$(23,386)$(46,653)$(133,088)$(190,774)
Adjustments to reconcile net loss to net cash provided by (used in) operating activities:
Depreciation expense13,587 11,371 51,602 42,619 
Amortization of intangible assets4,899 5,582 20,424 21,696 
Non-cash lease expense5,451 7,835 22,678 25,448 
Amortization of debt discount and issuance costs456 715 2,476 3,169 
Amortization of deferred contract costs4,295 2,896 15,548 8,916 
Stock-based compensation35,447 31,418 136,303 145,796 
Deferred income taxes
(900)— (900)— 
Provision for credit losses714 624 2,025 2,406 
Loss on disposals of property and equipment
— — 505 854 
Amortization and accretion of discounts and premiums on investments(990)515 (646)3,137 
Impairment of operating lease right-of-use assets156 2,083 744 2,083 
Impairment expense— — 4,316 — 
Net gain on extinguishment of debt(15,656)— (52,416)(54,391)
Other adjustments905 3,980 648 3,688 
Changes in operating assets and liabilities:
Accounts receivable(22,590)(17,288)(32,945)(27,359)
Prepaid expenses and other current assets4,107 (971)8,709 (6,758)
Other assets(6,868)(15,492)(23,137)(35,396)
Accounts payable(876)(1,267)382 (4,724)
Accrued expenses(1,603)3,799 (7,856)8,289 
Operating lease liabilities(5,137)(6,377)(22,074)(22,778)
Other liabilities612 5,102 7,064 4,447 
Net cash provided by (used in) operating activities(7,377)(12,128)362 (69,632)
Cash flows from investing activities:
Purchases of marketable securities(59,142)— (132,233)(355,479)
Sales of marketable securities24,850 65 25,625 161,918 
Maturities of marketable securities5,642 94,303 433,767 535,040 
Business acquisitions, net of cash acquired— 1,843 — (25,902)
Advance payment for purchase of property and equipment— (10,923)— (42,197)
Purchases of property and equipment(2,693)(8,529)(10,976)(19,975)
Proceeds from sale of property and equipment— 126 49 492 
Capitalized internal-use software(5,902)(4,290)(21,292)(18,146)
Net cash provided by (used in) investing activities
(37,245)72,595 294,940 235,751 
Cash flows from financing activities:
Cash paid for debt extinguishment(113,606)— (310,540)(177,082)
Repayments of finance lease liabilities(5,932)(4,427)(27,175)(22,532)
Cash received for restricted stock sold in advance of vesting conditions— — — 10,655 
Cash paid for early sale of restricted shares— — — (10,655)
Payment of deferred consideration for business acquisitions— — (4,393)— 
Proceeds from exercise of vested stock options161 364 2,169 5,688 
Proceeds from employee stock purchase plan1,550 (949)8,559 4,777 
Net cash used in financing activities(117,827)(5,012)(331,380)(189,149)
Effects of exchange rate changes on cash, cash equivalents, and restricted cash70 39 608 (390)
Net increase in cash, cash equivalents, and restricted cash(162,379)55,494 (35,470)(23,420)
Cash, cash equivalents, and restricted cash at beginning of period270,450 88,047 143,541 166,961 
Cash, cash equivalents, and restricted cash at end of period108,071 143,541 108,071 143,541 
Reconciliation of cash, cash equivalents, and restricted cash as shown in the statements of cash flows:
Cash and cash equivalents107,921 143,391 107,921 143,391 
Restricted cash, current150 150 150 150 
Total cash, cash equivalents, and restricted cash$108,071 $143,541 $108,071 $143,541 






Free Cash Flow
(in thousands, unaudited)
Three months ended
December 31,		Year ended
December 31,
2023202220232022
Cash flow provided by (used in) operations$(7,377)$(12,128)$362 $(69,632)
Capital expenditures(1)
(14,527)(17,120)(59,394)(60,161)
Advance payment for purchase of property and equipment(2)
— (10,923)— (42,197)
Free Cash Flow$(21,904)$(40,171)$(59,032)$(171,990)
__________
(1)Capital expenditures are defined as cash used for purchases of property and equipment, net of proceeds from sale of property and equipment, capitalized internal-use software and payments on finance lease obligations, as reflected in our statement of cash flows.
(2)As reflected in our statement of cash flows. In the year ended December 31, 2023, we received $8.7 million of capital equipment that was prepaid prior to the current year.













Contacts:
Investor Contact:
Vernon Essi, Jr.
ir@fastly.com

Media Contact:
Spring Harris
press@fastly.com

Source: Fastly, Inc.