DA Davidson analyst Rudy Kessinger reaffirmed a Neutral rating on Fastly but questioned the near-term revenue impact from AI agents like Muse, despite increasing the price target. The analyst's calculations suggest that even widespread adoption of Muse would only contribute a small percentage to Fastly's consensus 2026 revenue, leading to a negative market reaction for FSLY shares.
DA Davidson analyst Rudy Kessinger raised Fastly's price target but expressed skepticism about the immediate revenue impact from AI agents like Muse. The analyst's detailed calculations, assuming significant adoption, project only a 2% contribution to Fastly's 2026 consensus revenue, which is not enough to materially affect growth in the near term. This analysis directly contradicts market enthusiasm around AI's potential for Fastly, leading to a significant sell-off in FSLY shares. While the long-term potential of AI for Fastly's security business is acknowledged, the immediate revenue generation from traffic is being questioned, creating a short-term negative sentiment for traders.