Akamai Reports Record Revenue and Profits for Third Quarter 2005.

CAMBRIDGE, Mass. -- Akamai Technologies, Inc. (NASDAQ: AKAM):

--Revenue grows 42 percent year-over-year to $75.7 million, a 17 percent increase from prior quarter

--GAAP net income expands in the third quarter to $272.3 million, or $1.71 per diluted share, including a benefit

--Normalized net income(a) increases 80 percent year-over-year to $22.0 million, or $0.14 per diluted share, a 29 percent increase over prior quarter's normalized net income

Akamai Technologies, Inc. (NASDAQ: AKAM), the leading global service provider for accelerating content and business processes online, today reported financial results for the third quarter ended September 30, 2005. Revenue for the third quarter 2005 was $75.7 million, a 17 percent increase over second quarter 2005 revenue of $64.6 million, and a 42 percent increase over third quarter 2004 revenue of $53.3 million.

Net income in accordance with United States Generally Accepted Accounting Principles, or GAAP, for the third quarter of 2005 was $272.3 million, or $1.71 per diluted share. The Company's GAAP net income included a benefit of $255.3 million, or approximately $1.59 per diluted share, primarily related to the recognition of the Company's net operating loss carryforward as a result of the release of a tax valuation allowance. The Company previously had discussed its expectation that the tax valuation allowance would be released in the second half of 2005. The Company has concluded, pursuant to Statement of Financial Accounting Standards No. 109, that the valuation allowance should be released primarily as a result of achieving sustained profitability.

Normalized net income(a) was $22.0 million, or $0.14 per diluted share, in the third quarter of 2005, a 29 percent increase over second quarter 2005 normalized net income of $17.1 million, or $0.12 per diluted share, and an 80 percent improvement over 2004 third quarter normalized earnings of $12.2 million, or $0.09 per diluted share. ((a)See Use of Non-GAAP Financial Measures below for definitions.)

Adjusted EBITDA(a) for the third quarter of 2005 of $27.7 million represented an increase of 55 percent year-over-year, and 22 percent over the prior quarter. Adjusted EBITDA as a percentage of revenue was 37 percent, up from 34 percent a year ago, and 35 percent in the prior quarter. ((a)See Use of Non-GAAP Financial Measures below for definitions.)

"We're very pleased with our third quarter results," said Paul Sagan, president and CEO of Akamai. "Many of our enterprise customers have continued to increase their use of the Internet and Akamai brings improved Internet performance and reliability to their critical business processes."

Cash from operations was $19.5 million in the third quarter, as compared to second quarter 2005 cash from operations of $16.9 million. During the quarter, the Company redeemed the remaining $56.6 million of its outstanding 5.5% convertible debt. On a year-to-date basis, cash from operations was $55.1 million, as compared to $35.7 million in the first nine months of 2004.

At September 30, 2005, the Company had approximately 139.7 million shares of common stock outstanding.

Customers

The number of customers under long-term services contracts at the end of the third quarter increased by 94 to a record 1,830, a 5 percent increase over second quarter 2005, and a 45 percent increase year-over-year.

"Strong growth in our customer base reflects increasing trust in Akamai to accelerate the on-line delivery of mission critical content and Web-based applications by businesses and government agencies," Sagan said.

Sales through resellers and sales outside the United States accounted for 24 percent and 20 percent, respectively, of revenue for the third quarter of 2005.

Quarterly Conference Call

Akamai will host a conference call today at 4:30 p.m. ET that can be accessed through 1-888-689-4521 (or 1-706-645-9202 for international calls). A live Webcast of the call may be accessed at www.akamai.com in the Investor section. In addition, a replay of the call will be available for one week following the conference through the Akamai Website or by calling 1-800-642-1687 (or 1-706-645-9291 for international calls) and using conference ID No. 9875106.

About Akamai

Akamai(R) is the leading global service provider for accelerating content and business processes online. More than 1,800 organizations have formed trusted relationships with Akamai, improving their revenue and reducing costs by maximizing the performance of their online businesses. Leveraging the Akamai EdgePlatform, these organizations gain business advantage today, and have the foundation for the emerging Web solutions of tomorrow. Akamai is "The Trusted Choice for Online Business." For more information, visit www.akamai.com.

Financial Statements

Condensed Consolidated Balance Sheets
                     (dollar amounts in thousands)
                              (unaudited)

                                          September 30,   December 31,
                                                  2005           2004
                                          ------------- --------------
                  Assets
Cash and cash equivalents                      $34,084        $35,318
Marketable securities                           32,232         34,380
Restricted marketable securities                   730            932
Accounts receivable, net                        43,935         30,333
Prepaid expenses and other current assets        9,148          7,706
                                          ------------- --------------
  Current assets                               120,129        108,669
Marketable securities                           15,735         34,065
Restricted marketable securities                 3,722          3,722
Property and equipment, net                     42,529         25,242
Goodwill and other intangible assets, net      139,503          5,128
Other assets                                     5,008          5,917
Deferred tax assets, net                       320,413              -
                                          ------------- --------------
  Total assets                                $647,039       $182,743
                                          ============= ==============

   Liabilities and stockholders' equity
Accounts payable and accrued expenses          $50,982        $42,446
Other current liabilities                        6,917          4,320
                                          ------------- --------------
  Current liabilities                           57,899         46,766
Other liabilities                               11,548          5,294
Convertible notes                              200,000        256,614
                                          ------------- --------------
Total liabilities                              269,447        308,674
Stockholders' equity (deficit)                 377,592       (125,931)
                                          ------------- --------------
  Total liabilities and stockholders' equity  $647,039       $182,743
                                          ============= ==============


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

                         Three Months Ended          Nine Months Ended
                 Sept.30, June 30, Sept.30, June 30, Sept.30, Sept.30,
                    2005    2005     2004     2004      2005     2004
                --------- ------- -------- --------  -------- --------

 Revenues        $75,713  $64,649  $53,286  $50,786  $200,458 $152,439

 Costs and operating
  expenses:
 Cost of
  revenues(b)     15,295   12,752   11,748   11,083    39,571   34,977
 Research and
  development      4,953    4,507    3,222    2,872    13,089    8,788
 Sales and
  marketing       19,803   18,363   12,965   13,671    54,911   40,646
 General and
  administrative
  (b)             14,568   11,341   11,874   10,521    37,748   33,592
 Amortization of
  other intangible
  assets           2,296      520       12       12     2,828       36
                --------- -------- -------- -------- --------- -------
 Total costs and
  operating
  expenses        56,915   47,483   39,821   38,159   148,147  118,039
                --------- -------- -------- -------- --------- -------
 Operating income 18,798   17,166   13,465   12,627    52,311   34,400

 Interest
  expense, net       567      770    1,533    2,045     2,350    6,736
 Loss on early
  extinguishment
  of debt          1,370        -      634    3,264     1,370    5,916
 Loss on
  investments, net    27        -       79        -        27       68
 Other expense
  (income), net       63      (77)    (101)      85       712      122
                --------- -------- -------- -------- --------- -------
 Income before
  (benefit)
  provision for
  income taxes    16,771   16,473   11,320    7,233    47,852   21,558
 (Benefit)
  provision for
  income taxes  (255,489)     573       71      430  (254,387)     585
                --------- -------- -------- -------- --------- -------
 Net income     $272,260  $15,900  $11,249   $6,803  $302,239  $20,973
                ========= ======== ======== ======== ========= =======

 Net income per share:
     Basic         $1.96    $0.12    $0.09    $0.06     $2.29    $0.17
     Diluted       $1.71    $0.11    $0.08    $0.05     $2.00    $0.16

 Shares used in
  per share calculations:
     Basic       139,204  130,119  125,618  123,645   132,125  123,789
     Diluted     160,362  149,986  147,294  146,408   152,336  133,557


    (b) Includes depreciation (see supplemental tables for figures)


                        Three Months Ended          Nine Months Ended
                Sept.30, June 30, Sept.30, June 30,  Sept.30, Sept.30,
                   2005     2005     2004     2004      2005     2004
               --------- -------- -------- -------- ---------  -------
Supplemental financial
 data (in thousands):
Network-related
 depreciation     $4,361   $3,472   $3,124   $3,725   $10,748  $11,299
Other depreciation  $881     $860   $1,024   $1,106    $2,680   $3,724

Capital
 expenditures     $8,531   $9,805   $5,346   $4,575   $28,055  $12,963

Net (decrease)
 increase in cash,
 cash equivalents,
 restricted cash
 and marketable
 securities   $(44,213) $12,695 $(2,329) $(54,922) $(21,914) $(88,558)

End of period statistics:
Number of customers
 under recurring
 contract          1,830    1,736    1,258    1,214
Number of employees  766      774      598      589
Number of deployed
 servers          18,092   17,500   15,064   14,916



            Condensed Consolidated Statements of Cash Flows
                        (amounts in thousands)
                              (unaudited)

                          Three Months Ended         Nine Months Ended
                Sept.30, June 30, Sept. 30, June 30, Sept.30, Sept.30,
                   2005     2005     2004     2004      2005     2004
               --------- -------- -------- --------  -------- --------

 Cash flows from
  operating
  activities:
  Net
   income       $272,260  $15,900  $11,249   $6,803  $302,239  $20,973
  Adjustments to
   reconcile net
   income to net
   cash provided
   by operating
   activities:
   Depreciation
    and
    amortization
    of deferred
    financing
    costs          7,792    5,074    4,469    5,189    17,006   16,155
   Equity-related
    compensation   1,383      657      249      274     2,267    1,056
   Change in
    deferred tax
    assets, net,
    including
    release of
    deferred tax
    asset valuation
    allowance   (255,345)       -        -        -  (255,187)      30
   Non-cash
    portion of
    loss on early
    extinguishment
    of debt          481        -      178    1,006       481    2,161
   Loss on
    investments,
    property and
    equipment and
    foreign
    currency, net    161      319      (72)      34       707      118
   Provision for
    doubtful
    accounts         566       41     (186)     (30)    1,020    (422)
   Changes in
    operating
    assets and
    liabilities:
    Accounts
     receivable,
     net          (4,194)  (1,837)  (2,076)  (1,696)  (10,792) (7,105)
    Prepaid
     expenses and
     other current
     assets        2,567   (1,926)   2,057      (37)    1,418    4,494
    Accounts
     payable,
     accrued
     expenses and
     other current
     liabilities  (6,818)  (1,846)     281    1,755    (3,786)   (168)
    Accrued
     restructuring  (710)    (339)    (354)    (474)   (1,401) (1,278)
    Deferred
     revenue       1,374       45   (2,016)    (393)    1,700  (1,236)
    Other
     noncurrent
     assets and
     liabilities     (18)     836      769       47      (547)     884
                --------- -------- -------- -------- --------- -------
  Net cash
   provided by
   operating
   activities:    19,499   16,924   14,548   12,478    55,125   35,662
                --------- -------- -------- -------- --------- -------

 Cash flows from
  investing
  activities:
   Cash acquired
    through
    business
    combination        -    1,717        -        -     1,717        -
   Purchases of
    property and
    equipment and
    capitalization
    of internal-
    use software  (8,531)  (9,805)  (5,346)  (4,575) (28,055) (12,963)
   Purchase of
    investments  (6,534) (15,541) (12,325) (39,117) (32,619) (172,860)
   Proceeds from
    sale of
    property and
    equipment          -        -        -        -         -        9
   Proceeds from
    sales and
    maturities of
    investments   33,733   14,231   15,588    9,400    53,167  196,713
   Decrease in
    restricted
    cash held for
    note
    repurchases        -        -        -        -         -    5,000
   Decrease in
    restricted
    investments
    held for
    security
    deposits           -        -       96        -         -       96
               --------- -------- -------- --------  -------- --------
  Net cash
   provided by
   (used in)
   investing
   activities     18,668   (9,398)  (1,987) (34,292)   (5,790)  15,995
               --------- -------- -------- --------  -------- --------

 Cash flows from
  financing
  activities:
   Payments on
    capital leases  (171)     (93)    (137)    (134)     (398)   (402)
   Proceeds from
    the issuance
    of 1%
    convertible
    senior notes,
    net of
    financing cots     -        -        -        -         -   24,313
   Repurchase and
    retirement of
    5 1/2%
    covertible
    subordinated
    notes        (56,614)       - (13,115) (68,523) (56,614) (144,511)
   Proceeds from
    the issuance
    of common
    stock under
    stock option
    and
    employee stock
     purchase
     plans         1,933    4,145    1,095    6,617     7,721    9,890
                --------- -------- -------- -------- -------- --------
  Net cash (used
   in) provided by
   financing
   activities   (54,852)   4,052  (12,157) (62,040) (49,291) (110,710)
               --------- -------- -------- --------  -------- --------

  Effects of
   exchange rate
   translation on
   cash and cash
   equivalents      (259)    (431)     357     (167)   (1,278)   (378)
                --------- -------- -------- --------  ------- --------

  Net (decrease)
   increase in
   cash and cash
   equivalents   (16,944)  11,147      761  (84,021)  (1,234) (59,431)
  Cash and cash
   equivalents,
   beginning of
   period         51,028   39,881   45,460  129,481    35,318  105,652
                --------- -------- -------- -------- -------- --------
  Cash and cash
   equivalents,
   end of period $34,084  $51,028  $46,221  $45,460   $34,084  $46,221
                ========= ======== ======== ========  ======= ========

(a) Use of Non-GAAP Financial Measures

In addition to providing financial measurements based on generally accepted accounting principles in the United States of America (GAAP), Akamai has historically provided additional financial metrics that are not prepared in accordance with GAAP (non-GAAP). Recent legislative and regulatory changes discourage the use of and emphasis on non-GAAP financial metrics and require companies to explain why non-GAAP financial metrics are relevant to management and investors.

Akamai defines "Adjusted EBITDA" as net income, before interest, taxes, depreciation and amortization of tangible and intangible assets, equity-related compensation, certain gains and losses on equity investments, foreign exchange gains and losses, release of the deferred tax asset valuation allowance and loss on early extinguishment of debt.

Adjusted EBITDA eliminates items that are either not part of the Company's core operations, such as investment gains and losses, foreign exchange gains and losses, early debt extinguishment and net interest expense, or do not require a cash outlay, such as equity-related compensation and impairment of intangible assets. Adjusted EBITDA also excludes depreciation and amortization expense, which is based on the Company's estimate of the useful life of tangible and intangible assets. These estimates could vary from actual performance of the asset, are based on historic cost incurred to build out the Company's deployed network, and may not be indicative of current or future capital expenditures. Because Adjusted EBITDA eliminates these items, Akamai considers this financial measure to be an important indicator of the Company's operational strength and performance of its business and a good measure of the Company's historical operating trend.

Akamai defines "Adjusted EBITDA margin" as a percentage of adjusted EBITDA over revenue. Akamai considers Adjusted EBITDA margin to be an indicator of the Company's operating trend and performance of its business in relation to its revenue growth.

Akamai defines "capital expenditures" or "capex" as purchases of property and equipment and capitalization of internal-use software development costs. Capital expenditures or capex are disclosed in Akamai's condensed consolidated statement of cash flows in the Company's most recent annual report on Form 10-K filed with the Securities and Exchange Commission.

Akamai defines "normalized net income" as net income before amortization of intangible assets, equity-related compensation, certain gains and losses on equity investments, release of the deferred tax asset valuation allowance and loss on early extinguishment of debt. Akamai considers normalized net income to be another important indicator of the overall performance of the Company because it eliminates the effects of events that are either not part of the Company's core operations or are non-cash.

Adjusted EBITDA and normalized net income should be considered in addition to, not as a substitute for, the Company's operating income and net income, as well as other measures of financial performance reported in accordance with GAAP.

Reconciliation of Non-GAAP Financial Measures

In accordance with the requirements of Regulation G issued by the Securities and Exchange Commission, the Company is presenting the most directly comparable GAAP financial measure and reconciling the non-GAAP financial metrics to the comparable GAAP measures.

Reconciliation of GAAP net income to normalized net income
                          and Adjusted EBITDA
             (amounts in thousands, except per share data)

                         Three Months Ended          Nine Months Ended
                Sept.30,  June 30, Sept.30, June 30, Sept.30, Sept.30,
                   2005     2005     2004     2004      2005     2004
               --------- -------- -------- -------- --------- --------

Net income      $272,260  $15,900  $11,249   $6,803  $302,239  $20,973

Amortization of
 intangible
 assets            2,296      520       12       12     2,828       36
Equity-related
 compensation      1,383      657      249      274     2,267    1,056
Loss on investments,
 net                  27        -       79        -        27       68
Release of the
 deferred tax
 asset valuation
 allowance      (255,345)       -        -        -  (255,345)       -
Loss on early
 extinguishment
 of debt           1,370        -      634    3,264     1,370    5,916
               --------- -------- -------- -------- --------- --------

Total normalized
 net income:      21,991   17,077   12,223   10,353    53,386   28,049

Interest expense,
 net                 567      770    1,533    2,045     2,350    6,736
(Benefit) provision
 for income taxes   (144)     573       71      430       958      585
Depreciation
 and amortization  5,242    4,332    4,148    4,831    13,428   15,023
Other expense
 (income), net        63      (77)    (101)      85       712      122
               --------- -------- -------- -------- --------- --------

Total Adjusted
 EBITDA:         $27,719  $22,675  $17,874  $17,744   $70,834  $50,515
               ========= ======== ======== ======== ========= ========

Normalized net income
 per share:
    Basic          $0.16    $0.13    $0.10    $0.08     $0.40    $0.23
    Diluted        $0.14    $0.12    $0.09    $0.07     $0.36    $0.21

Shares used in
 normalized per
 share calculations:
    Basic        139,204  130,119  125,618  123,645   132,125  123,789
    Diluted      159,994  149,986  147,294  146,408   152,336  146,449

Akamai Statement Under the Private Securities Litigation Reform Act

The release contains information about future expectations, plans and prospects of Akamai's management that constitute forward-looking statements for purposes of the safe harbor provisions under The Private Securities Litigation Reform Act of 1995, including statements concerning the expected growth and development of our business and expectations as to continued profitability. Actual results may differ materially from those indicated by these forward-looking statements as a result of various important factors including, but not limited to, unexpected increases in Akamai's use of funds, loss of significant customers, failure to increase our revenue and keep our expenses consistent with revenues, failure to realize our expectations with respect to the acquisition of Speedera, the effects of any attempts to intentionally disrupt our services or network by unauthorized users or others, failure to have available sufficient transmission capacity, a failure of Akamai's services or network infrastructure, failure to maintain the prices we charge for our services, inability to service and repay our outstanding debt and other factors that are discussed in the Company's Annual Report on Form 10-K, quarterly reports on Form 10-Q, and other documents periodically filed with the SEC.

In addition, the statements in this press release represent Akamai's expectations and beliefs as of the date of this press release. Akamai anticipates that subsequent events and developments may cause these expectations and beliefs to change. However, while Akamai may elect to update these forward-looking statements at some point in the future, it specifically disclaims any obligation to do so. These forward-looking statements should not be relied upon as representing Akamai's expectations or beliefs as of any date subsequent to the date of this press release.