What happened?
Shares of edge cloud platform Fastly (NASDAQ: FSLY) fell 24.9% in the morning session after the company announced its third-quarter 2026 financial results which failed to impress.
According to a company press release, Fastly reported record third-quarter revenue of $190.2 million, representing 20.2% year-over-year growth, roughly in line with expectations. Chief Revenue Officer Scott Lovett planned to retire next year, prompting the company to search for his successor while he continued running go-to-market operations during the transition. Despite the top-line growth, sharp stock declines following quarterly reports often reflect investor concerns over executive departures or apprehension that results failed to exceed elevated expectations.
The stock market overreacts to news, and big price drops can present good opportunities to buy high-quality stocks. Is now the time to buy Fastly? Access our full analysis report here, it’s free.
What is the market telling us
Fastly’s shares are extremely volatile and have had 83 moves greater than 5% over the last year. But moves this big are rare even for Fastly and indicate this news significantly impacted the market’s perception of the business.
The previous big move we wrote about was 3 days ago when the stock dropped 6.7% on the news that software stocks extended the selloff from the previous session as investors continued to reprice valuations amid mounting artificial intelligence capital expenditure concerns and decelerating software bookings.
Fastly is up 52.2% since the beginning of the year, but at $15.56 per share, it is still trading 53.5% below its 52-week high of $33.50 from April 2026. Despite the year-to-date gain, investors who bought $1,000 worth of Fastly’s shares 5 years ago would now be looking at only $311.57.
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