Tech

Fastly shares rocket as much as 60% in IPO debut

Key Points
  • Amazon and Google are among Fastly's competitors.
  • Fastly priced shares at the top end of its range on Thursday.
VIDEO3:5803:58
Fastly CEO Artur Bergman on cloud computing

Fastly, whose technology helps companies more quickly deliver online content, made its debut on the New York Stock Exchange on Friday with shares rising as much as 60%.

The stock started trading at $21.50 per share, up 34% from the price it sold shares in the initial public offering, under the symbol FSLY. The stock closed at $23.99, a gain of nearly 50%, making Fastly's debut the 11th best so far in 2019.

Fastly is one of several technology companies that have gone public in 2019. Others include Lyft, Pinterest, Uber and Zoom. Crowdstrike and Slack are among the companies that have kicked off the process.

Fastly released the prospectus for its initial public offering on April 19. On May 6, Fastly issued an updated prospectus in which it estimated that its stock could be sold for between $14 and $16 in the IPO. On Thursday Fastly said it had sold 11.25 million shares at $16 each, raising $180 million.

The company operates a content-distribution network with data center infrastructure around the world to more quickly provide videos, photos and other information. Competitors include Akamai, Alphabet's Google, Amazon, Cisco and Verizon.

Artur Bergman, CEO, Fastly
Source: CNBC

In 2018, Fastly had a $30.9 million net loss on $144.6 million in revenue. Revenue was up nearly 38% year over year, and the company narrowed its losses by 5%. Fastly recorded a $9.7 million net loss and $45.6 million in revenue in the first quarter; in that period revenue was up 40% year over year, although the loss grew almost 5%.

Fastly was founded in 2011 and is based in San Francisco, with 489 employees as of March 31. As of that date it had 1,621 customers, 243 of which the company identifies as enterprise customers — organizations that have delivered more than $100,000 in the latest 12-month period. These enterprise customers gave Fastly 85% of its revenue in the first quarter.

Among the companies on Fastly's customer list are Hulu, Microsoft, The New York Times, Spotify and Wayfair.

The lead bookrunners in the IPO were Bank of America Merrill Lynch, Citigroup and Credit Suisse.

-- CNBC's Gina Francolla contributed to this report.