As the Q4 earnings season comes to a close, it’s time to take stock of this quarter's best and worst performers in the software development industry, including Akamai (NASDAQ:AKAM) and its peers.

As legendary VC investor Marc Andreessen says, "Software is eating the world", and it touches virtually every industry. That drives increasing demand for tools helping software developers do their jobs, whether it be monitoring critical cloud infrastructure, integrating audio and video functionality, or ensuring smooth content streaming.

The 11 software development stocks we track reported a mixed Q4; on average, revenues beat analyst consensus estimates by 3%. while next quarter's revenue guidance was 0.8% above consensus. Stocks, especially growth stocks where cash flows further in the future are more important to the story, had a good end of 2023. The beginning of 2024 saw mixed inflation data, however, leading to more volatile stock performance, and while some of the software development stocks have fared somewhat better than others, they collectively declined, with share prices falling 1.3% on average since the previous earnings results.

Weakest Q4: Akamai (NASDAQ:AKAM)

Founded in 1999 by two engineers from MIT, Akamai (NASDAQ:AKAM) provides software for organizations to efficiently deliver web content to their customers.

Akamai reported revenues of $995 million, up 7.2% year on year, falling short of analyst expectations by 0.5%. It was a weak quarter for the company, with underwhelming revenue guidance for the next quarter and a miss of analysts' revenue estimates.

"Akamai's fourth quarter financial performance capped off an excellent year for the company highlighted by very strong profitability," said Dr. Tom Leighton, Akamai's Chief Executive Officer.

Akamai delivered the weakest performance against analyst estimates of the whole group. The stock is down 16.9% since the results and currently trades at $104.

Read our full report on Akamai here, it's free.

Best Q4: Bandwidth (NASDAQ:BAND)

Started in 1999 by David Morken who was later joined by Henry Kaestner as co-founder in 2001, Bandwidth (NASDAQ:BAND) provides thousands of customers with a software platform that uses its own global network to provide phone numbers, voice, and text connectivity.

Bandwidth reported revenues of $165.4 million, up 5.4% year on year, outperforming analyst expectations by 7.4%. It was an exceptional quarter for the company, with a significant improvement in its net revenue retention rate and optimistic revenue guidance for the next quarter.

Bandwidth scored the biggest analyst estimates beat and highest full-year guidance raise among its peers. The stock is up 40.5% since the results and currently trades at $17.1.

Is now the time to buy Bandwidth? Access our full analysis of the earnings results here, it's free.

Twilio (NYSE:TWLO)

Founded in 2008 by Jeff Lawson, a former engineer at Amazon, Twilio (NYSE:TWLO) is a software as a service platform that makes it really easy for software developers to use text messaging, voice calls and other forms of communication in their apps.

Twilio reported revenues of $1.08 billion, up 5% year on year, exceeding analyst expectations by 3.2%. It was a weaker quarter for the company, with underwhelming revenue guidance for the next quarter and decelerating customer growth.

The stock is down 15% since the results and currently trades at $61.55.

Read our full analysis of Twilio's results here.

Cloudflare (NYSE:NET)

Founded by two grad students of Harvard Business School, Cloudflare (NYSE:NET) is a software as a service platform that helps improve security, reliability and loading times of internet applications and websites.

Cloudflare reported revenues of $362.5 million, up 32% year on year, surpassing analyst expectations by 2.7%. It was a good quarter for the company, with a decent beat of analysts' billings estimates but full-year revenue guidance missing analysts' expectations.

The stock is up 4.5% since the results and currently trades at $94.46.

Read our full, actionable report on Cloudflare here, it's free.

F5 (NASDAQ:FFIV)

Initially started as a hardware appliances company in the late 1990s, F5 (NASDAQ:FFIV) makes software that helps large enterprises ensure their web applications are always available by distributing network traffic and protecting them from cyberattacks.

F5 reported revenues of $692.6 million, down 1.1% year on year, surpassing analyst expectations by 1.1%. It was a very strong quarter for the company, with an impressive beat of analysts' billings estimates and solid sales guidance for the next quarter.

F5 had the slowest revenue growth among its peers. The stock is up 2.6% since the results and currently trades at $190.27.

Read our full, actionable report on F5 here, it's free.

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