Many investors are probably scratching their heads after Fastly suffered a major global outage, and then saw its stock price rise 10%.
Normally, if a business suffers a major outage that disrupts millions of workers across the world, somebody’s head is put on the chopping block.
For Fastly (NYSE: FSLY) though, an outage could be its greatest marketing event to date.
What happened to Fastly?
In an event that the somewhat melodramatic among us are labeling: “the breaking of the internet”, Fastly experienced a major outage on Tuesday morning. Amongst the many affected customers were Amazon, Reddit, and The New York Times.
Users reportedly received error messages including “Error 503 Service Unavailable” and “connection failure” when attempting to visit various websites. Fastly fixed the problem within an hour of identifying it though and released a statement to confirm that it was not a cyberattack, simply an error. With the panic over, there’s just one question on investors’ minds:
How did this $6 billion company cause such disruption around the world?
Well, Fastly operates what’s known as a content delivery network, or CDN. These are networks of servers and data centers distributed around the world that allow for the transfer of assets needed for loading internet content.
In layman’s terms: “Fastly make internet go zoom!”
Until now though, Fastly has been a divisive stock among investors, having gathered a cult-like following last year, while others believed it to be too expensive.
After this outage, however, investors have been subject to evidence — albeit unwanted — that Fastly is actually kind’ve a big deal. Not only did it handle such a massive outage quickly and efficiently, but it also proved just how invaluable a service it offers to more than 2,000 important customers.
Perhaps if a $6 billion company could take down the internet, then it should be worth more than $6 billion?
MyWallSt operates a full disclosure policy. MyWallSt staff currently holds long positions in companies mentioned above. Read our full disclosure policy here.