Is Limelight Networks' Post-Earnings Dip a Buying Opportunity?

Limelight Networks'(NASDAQ: LLNW) shareholders had legitimate reasons to fear third-quarter earnings. On Oct. 14, the competitor Fastly withdrew its full-year guidance and communicated surprisingly weak preliminary results because of reduced spending of some customers. That suggested lower-than-expected growth potential in the content delivery network (CDN) industry, which includes Limelight Networks.

Those concerns were justified: Limelight Networks' stock plunged by more than 25% after the company posted disappointing results. However, since management didn't change its full-year revenue guidance range, should investors take advantage of that post-earnings dip to buy the company's stock?

Limelight Networks developed a worldwide computing infrastructure to allow customers to host internet content closer to users and improve the user experience. As the company has been focusing on video, media, and gaming, the coronavirus pandemic had a mixed impact over the last several months. For instance, the increased consumption of video streaming and online gaming boosted the company's business. But the reduced number of online live events had the opposite effect.

Source Fool.com