$AKAM · AKAMAI TECHNOLOGIES INC
On November 5, 2026, Akamai entered Amendment No. 4 to its November 22, 2022 credit agreement, raising the maximum consolidated leverage ratio covenant to 6.25:1.00 for the quarters ending December 31, 2026 and March 31, 2027, stepping down to 3.75:1.00 by March 31, 2028. The amendment also cuts the secured subsidiary indebtedness and liens basket from 10% to 3.5% of consolidated total assets through March 31, 2028. On November 9, 2026, Akamai announced a private offering of $1.1B convertible senior notes due 2028 and $1.1B due 2031, with a $150M additional-purchase option per series.
- Leverage covenant raised to 6.25:1.00 for quarters ending Dec 31, 2026 and Mar 31, 2027, then steps down to 3.75:1.00 by Mar 31, 2028.
- Secured subsidiary debt and liens basket cut from 10% to 3.5% of consolidated total assets through Mar 31, 2028.
- Offering totals $2.2B across 2028 and 2031 convertible notes, plus up to $300M in additional-purchase options.
- Proceeds will repay the $1.15B 0.375% convertible notes due Sept 1, 2027 and fund Cloud Infrastructure Services capex.
- Akamai plans convertible note hedge and warrant transactions to reduce dilution upon conversion.
Extended-hours last trade of $76.85 is down 7.51% versus the $83.09 regular close, signaling investors are pricing in dilution and added leverage from the $2.2B convertible offering.
A $2.2B convertible raise paired with a relaxed leverage covenant signals Akamai is taking on significant debt to fund its cloud buildout, with dilution risk for shareholders.
The covenant loosening and convertible raise reflect heavy capital needs for Akamai's Cloud Infrastructure Services buildout amid an AI-driven cloud expansion cycle.
The warrant transactions could dilute common stock if the share price exceeds the warrant strike price. The offering may not be completed on anticipated terms, or at all.