Ak am I currently falling. Now. This is after forecasts for revenue and unjusted earnings per Cheer came in well less than the market it wanted to see it here to walk us through some of the numbers and the content distribution part in particular, that seems to be the weakness. As a CEO, Tom Layton, and security revenue was good, up twenty one percent, Compute revenue good up twenty five percent.
But it's a delivery revenue that isn't under pressure. Is that what's really hitting the revenue forecasts?
Yes, exactly right. You know, Internet traffic always increases, but it's not in a straight line, and we have the world's largest content delivery network and so when there are dips, we feel it. The good news is that we really diversified our business beyond delivery to the point where now two thirds of our revenue is security and compute, and as you noted, both of those businesses are very strong,
great growth and great potential. And I think over time, as we have more and more of our rebels from security and compute, you know the dips you get from time to time and Internet traffic we won't see as noticeably on our overall performance.
Interesting diversification key what's took me my interest was a large social media customer optimizing its costs. As what was put forward as to why you've downgraded some of the outlooks. Who is the social media player? Are we seeing that more broadly.
Or is it just one Well, we do have a very large social media company and they are cutting back as best they can on costs, you know, facing some geopolitical pressures, I would say more broadly. You know, we've seen sort of a week past couple of months in the gaming vertical and in video, and there's been a lot of reports out there talking about you know, subscriber numbers,
you know, and traffic as a whole. And so we feel that because you know, we carried most of all the video out there and a very big for the gaming companies, and so that creates a little bit of a dip in our outlook for the year. That said, we raised our outlook on security and compute, both of those business is very strong.
Tom, You're the perfect person to therefore ask, because I'm reading between the lines here, a geopolitically affected social media company has got to be TikTok, and I know that you have expertise when it comes to security, and we're broadly an exposure at the moment that we're seeing of US companies to China. How much you seeing geo politics weighing on your business and the business of your clients.
Well, there is some concern there, and you know we made a disclosure that in particular, if the law does take effect banning TikTok, that could impact about a percent and a half of our revenue next year. You know, it shouldn't have a direct impact this year, and it remains to be seen if the law will go into effect.
Are you trying to diversify out of exposure to China more more time?
Well, we want to diversify our company as a whole. Today we have seven customers at one percent of revenue, and you know the goal is to have a broader and broader base, and I think we've done a really good job of that, both within the customer base and also across product lines and geographies, so that you know, you won't see much of an impact. You know, as we go forward, when you know particular things happen on the political stage, or you get a dip in traffic.
And I mean with the wealth of patterns that you have and the focus on security. Where are we in the cybersecurity landscape? How much are you seeing in particularly the age of artificial intelligence, it becomes harder and harder to ensure that we are protected in some way from our data.
Yeah, things are in a very challenged state with cybersecurity, particularly with the advances in gen ai, which as of now are very helpful to the attacker. It's much easier for them to generate very malicious male where we're seeing a lot more breaches and I think the key now really is to develop the internal layer of defense for an enterprise because probably you're going to get breached, and the key is to identify it quickly and to proactively
block it spread. And there we have the market leading solution with guardacor to stop the spread of ransomware and data exfiltration malware. And that's a very rapidly growing segment
For US and a key acquisition made Tom Lighton, thank you so much spending time with us, Yakama and CEO