{
  "@context": "https://frontierpicks.com/schemas/dossier.v1.json",
  "ticker": "FSLY",
  "name": "Fastly, Inc.",
  "url": "https://frontierpicks.com/dossiers/FSLY/",
  "json_url": "https://frontierpicks.com/dossiers/FSLY.json",
  "status": "DORMANT",
  "current_conviction": "MEDIUM",
  "graded_conviction": null,
  "archetype": {
    "code": "a4",
    "n": 4
  },
  "current_thesis": "The Q2 margin inflection finally got paid, five sessions late: shares moved ~21% on 2026-08-10 to $27.69 intraday, the highest since early 2024. Three insiders then disposed at $28.60–$30.00 on 2026-08-18 and the 2026-08-21 close was $24.95. The re-rating leg is in the price and nothing company-dated lands before the ~November Q3 print.",
  "invalidation_trigger": "A weekly close below $22.50 fills the 2026-08-10 gap and retraces the entire delayed re-rating leg (the 2026-08-07 close of $22.96 is that shelf); secondary break is a cut to the FY2026 $732–746M revenue guide at the Q3 print, or an issuance off the August 2026 shelf.",
  "catalyst_date": null,
  "outcome": "OPEN",
  "outcome_date": null,
  "invalidation_fired": null,
  "themes": [
    "ai-enterprise-software",
    "ai-datacenter-infrastructure",
    "cybersecurity"
  ],
  "tags": [],
  "sources": [],
  "notes": [
    "FY2026 guidance of $0.50-0.54 EPS is non-GAAP; adjusted figures exclude stock-based compensation and are not comparable to GAAP results.",
    "Top-ten customers were 37% of Q2 2026 revenue (31% a year earlier) — quarterly results are sensitive to one large account's traffic decisions.",
    "A universal automatic shelf (Form S-3ASR) appears in EDGAR filings from August 2026, so equity issuance capacity is standing rather than requiring a new registration.",
    "CEO share sales run under a Rule 10b5-1 plan adopted 2025-08-27; the disposals are pre-scheduled and not discretionary timing signals.",
    "The CFO's 2026-08-18 sale was disclosed as satisfying tax obligations on vesting restricted stock units, a different mechanism from a discretionary sale.",
    "Short-interest figures for FSLY differ materially between vendors; check the FINRA settlement-date file before citing a level."
  ],
  "body_markdown": "## Current Thesis\nThe margin inflection printed on 2026-08-05 got paid five sessions late. Shares jumped roughly 21% on 2026-08-10 to $27.69 intraday, described by 24/7 Wall St as the highest level since early 2024, on no new company disclosure — the market re-reading a quarter it had initially sold. The narrative leg an investor buys here is a legacy CDN re-rating on security mix and adjusted EBITDA ($38.1M in Q2 FY26 vs $8.9M a year earlier), with the qualifier that the attention burst has already happened and no dated company catalyst lands before the Q3 print in early November.\n\n## Bull Case\n- Q2 FY26, reported 2026-08-05: revenue $183.3M, +23% YoY against $173.9M consensus; non-GAAP EPS $0.15 versus $0.07 estimate.\n- Segment mix: Security $41.7M (+43% YoY), Network Services $133.9M (+17%), Other $7.7M (+69%) — the shift is visible in the reported lines.\n- Adjusted EBITDA $38.1M vs $8.9M in Q2 2025, a 21% margin, with record non-GAAP gross margin of 65.8%.\n- Remaining performance obligations $341M vs $247M in Q2 2025 (+38%); LTM net revenue retention 117%, described by the company as the highest in over three years.\n- FY2026 guidance raised on 2026-08-05 to $732–746M revenue (from $710–725M) and $0.50–0.54 adjusted EPS (from $0.27–0.33); Q3 guide $184–190M and $0.11–0.13, both above the consensus figures cited at the time ($179.8M / $0.06).\n- Sell-side stayed above the tape through the move: Evercore ISI reiterated Outperform with a $32 target and KeyBanc a $30 target as of coverage dated 2026-08-10, after RBC ($28, Sector Perform), Piper Sandler ($28, Neutral) and KeyBanc ($30, Overweight) all raised on 2026-08-06.\n- The bull argument circulating in that coverage is a multiple gap — roughly 6x price-to-sales against Cloudflare above ~49x (24/7 Wall St, 2026-08-10). That is a third-party framing of relative value, not a statement about where either name should trade.\n- Cash, equivalents, marketable securities and investments of approximately $337M at 2026-06-30, up $7M from 2026-03-31.\n\n## Bear Case\n- Insider supply arrived directly into the spike week.\n- Those 2026-08-19 execution prices span $24.08 to $26.05 in a single session, one day after $28.60 — the give-back was fast and it happened without a company announcement.\n- The 2026-08-21 close of $24.95 sits below the 2026-08-10 intraday $27.69, so the extension above the initial gap has\n- Two of the three post-print target raises on 2026-08-06 carried non-Buy ratings. Numbers moved; stances did not.\n- Top-ten customers were 37% of Q2 2026 revenue against 31% in Q2 2025. Concentration widened in the same quarter growth accelerated.\n- Free cash flow was $3.6M versus $10.9M a year earlier with infrastructure capex near 17% of revenue: the EBITDA line moved far more than the cash line.\n- A universal automatic shelf (Form S-3ASR) appears in EDGAR filings from August 2026, leaving standing issuance capacity. The company has used the convertible market before — a proposed $125M convertible senior notes offering due 2030 was announced in December 2025.\n- Broad-audience coverage arrived after the move, not before it: a Benzinga item on 2026-08-13 carried Jim Cramer calling Fastly \"back from the abyss.\"\n\n## Setup & Price Structure\nLast completed daily close $24.95 (2026-08-21), 25.5% below the $33.50 52-week high. RSI(14) at 54.0 — the momentum built into 2026-08-18 has already discharged and reset to mid-range. Three-month price change of +52.9%.\n\nThe structure has three marked levels. Below sits the 2026-08-07 close of $22.96, the shelf the 2026-08-10 gap left behind; that shelf is the whole of the delayed re-rating. Above sits $27.69, the 2026-08-10 intraday print, and then the $28.60–$30.00 band where the CFO, the CEO and a director all transacted on 2026-08-18. Price now sits between the two, roughly 8% above the gap shelf and 14% below where insiders printed three sessions earlier.\n\nCrowding and positioning observables, stated as observables: a 21% single-session move on no company disclosure (2026-08-10); a national-television mention three days later (2026-08-13); three separate Form 4 dispositions inside one week at $28.60–$30.00; standing shelf capacity registered in August 2026; and no scheduled earnings date for roughly ten weeks. Short-interest readings for FSLY differ materially between vendors, so no single figure is cited here.\n\nThe narrative is maturing. The acceleration window is datable — it ran 2026-08-10 to 2026-08-18, with fresh headlines, a broadened audience and a 21% expansion day. What dates the transition out of it is the 2026-08-19 to 2026-08-21 give-back on no news, the failure to hold the insider-transaction band, and the absence of any company-dated event to refresh the story before November.\n\n## Catalyst Calendar (next 30 days)\n\n- **2026-08-22 to 2026-09-21** — no company-confirmed dated event identified in this window. Price in the interval is set by flow and by peer-group moves rather than by disclosure.\n- **2026-09-30** — Q3 FY26 period close (just outside the 30-day window). The quarter being measured against the $184–190M revenue and $0.11–0.13 adjusted EPS guide issued 2026-08-05.\n- **~2026-11-04 (est.)** — Q3 FY26 earnings print. First test of whether LTM NRR holds at or above 117%, whether RPO extends past $341M, and whether the raised FY2026 $732–746M range survives the second half.\n\n## Elapsed catalysts\n\n- **Ongoing** — further Form 4 filings under the CEO's 2025-08-27 Rule 10b5-1 plan are the only recurring dated filings expected inside the window; the plan's dispositions are pre-scheduled. *(passed 364d ago)*\n\n## What Would Change Our Mind\nThe structure that has to hold is the 2026-08-10 gap shelf around the 2026-08-07 close of $22.96. If that fills, the entire delayed re-rating is retraced and the name is back where it stood before the market decided the Q2 print mattered. A weekly close below $22.50 marks that. Secondary conditions, each independent of price: a cut to the FY2026 $732–746M revenue guide at the Q3 print; a 424B prospectus supplement, ATM programme or convertible offering off the August 2026 shelf; or top-ten customer share disclosed above 37% alongside a called-out large-account traffic decline.\n\nThe reverse also has a marked level. A weekly close back above $27.69 would put price through the 2026-08-10 high and into the band where three insiders transacted on 2026-08-18, which would say the supply at $28.60–$30.00 was absorbed rather than decisive.\n\n## Correlation Notes\n- Trades with the AI-cloud and edge complex. The 2026-08-10 move was framed in coverage that day as company-specific plus a broad bounce across AI-cloud names; Cloudflare is the direct read-across and the reference point in the multiple-gap argument.\n- Newly-profitable-on-adjusted-metrics software with a 65.8% non-GAAP gross margin behaves as a high-beta, duration-sensitive name; index and ETF flows into software baskets move it more than CDN pricing news does.\n- Customer concentration at 37% of revenue in the top ten breaks the peer read-through in the other direction: one large account's traffic decision can separate FSLY's print from an otherwise healthy peer quarter.\n- Adjusted figures exclude stock-based compensation, so comparisons against GAAP-profitable peers on the same line are not like-for-like.",
  "first_seen": "2026-07-28",
  "last_analyzed": "2026-08-22T08:47:22+00:00",
  "last_synthesized": "2026-08-22",
  "last_update_source": "watchlist_research",
  "license": "Content © FrontierPicks. Cite the canonical URL."
}