Fastly falls after convertible bond sale boosted to $160 mln

Fastly

05/12/2025 15:00

** Content-delivery network co Fastly's FSLY.N shares down 8.2% to $10.57 early Fri after capital raise to reduce debt

    ** San Francisco-based FSLY early Fri announced pricing
     private offering of $160 mln 0% 5-yr convertible bonds (CBs)

    ** Initial conversion price set at $15.26, a 32.5% premium to stock's last close

    ** FSLY shares on Thurs fell 1.9% to $11.52 after co late Weds announced $125 mln offering

** Co intends to use portion of net offering proceeds to repurchase $150 mln of its ~$188.6 mln outstanding 0% CBs due 2026

** It also plans to use ~$16 mln pay cost of capped calls to offset potential dilution; the inital cap price of $23.04 is double the stock's last sale on Thurs

** On Nov 6, shares surged 36% to close at $10.97 after co late on Nov 5 reported Q3 rev of $158.2 mln, topping analyst expectations, as security rev grew 30% yr/yr

** Including the move on Fri, FSLY shares up 12% YTD

    ** Of 10 analysts covering FSLY, 1 rates "buy", 8 have "hold" and 1 rates "sell"; median PT $10.75, per LSEG data

(Lance Tupper is a Reuters market analyst. The views expressed are his own)

((lance.tupper@tr.com 1-646-279-6380))