Cloudflare, Inc.

Cloudflare, Inc. (NET) Market Cap

Cloudflare, Inc. has a market capitalization of $98.92B.

Price: $278.70

▼ -4.69 (-1.65%)

Market Cap: 98.92B

NYSE · time unavailable

CEO: Matthew Prince

Sector: Technology

Industry: Software - Infrastructure

IPO Date: 2019-09-13

Website: https://www.cloudflare.com

Cloudflare, Inc. (NET) - Company Information

Market Cap: 98.92B|Sector: Technology

Company Profile

Cloudflare, Inc. functions as a global provider of cloud-based services. The company delivers a comprehensive, integrated cloud security platform designed to safeguard a diverse array of digital environments, encompassing public and private clouds, on-premises infrastructure, Software-as-a-Service (SaaS) applications, and Internet of Things (IoT) devices. Its security portfolio features tools such as cloud firewalls, bot mitigation, distributed denial-of-service (DDoS) protection, IoT security, SSL/TLS encryption, secure origin connections, and rate limiting capabilities. Beyond security, Cloudflare also boosts online performance through services like content delivery networks (CDNs), intelligent routing, and various content, mobile, and image optimization tools. For enhanced reliability and availability, it provides solutions such as load balancing, its proprietary Anycast network, a virtual backbone, DNS services, DNS resolvers, and virtual waiting rooms. Furthermore, the company offers internal infrastructure tools, including "on-ramps" that facilitate seamless connections for users, devices, or locations to its expansive network, alongside "filters" engineered for data protection, inspection, and access management. Developer-centric solutions encompass serverless computing, programmable networks, website creation, domain registration, a suite of Cloudflare applications, advanced analytics, and data localization management. For individual consumers, Cloudflare provides a DNS Resolver application to improve internet browsing and a Consumer VPN to secure and speed up mobile device traffic. Its clientele spans a broad spectrum of industries, including technology, healthcare, financial services, consumer and retail, non-profit organizations, and government agencies. Established in 2009, Cloudflare, Inc. is headquartered in San Francisco, California.

Analyst Sentiment

59%
Buy

From 35 Active Polls

1Y Forecast: $250.00

▼ -10.3% Potential Upside

Consensus Target Metrics

Low Bound

$136

Median

$260

High Bound

$330

Average

$250

Price & Moving Averages

Loading chart...

🎯 Wall Street Analyst Intelligence Report

1-Year structural target targets, chart projections, and sentiment maps.

Average 1Y Target
$250.00
▼ -10.30% Upside
Low Target
$136.00
-51% Risk
Median Target
$260.00
-7% Mid
High Target
$330.00
18% Max
Consensus
Buy
29 / 40 Buys

Consensus Trend Projection

Trailing closures vs. 12-month metrics map.

Analyst Vote Distribution

Aggregate institutional coverage sentiment weights.

valuation & financial ratiosdetailed financials

📊 Historical Valuation Multiples

Real-time Trailing Twelve Month (TTM) momentum side-by-side with discrete quarterly metrics.

Fiscal QuarterTTMQ1 2026Q4 2025Q3 2025Q2 2025Q1 2025Q4 2024Q3 2024Q2 2024
Period EndingTrailing 12MMar 31, 2026Dec 31, 2025Sep 30, 2025Jun 30, 2025Mar 31, 2025Dec 31, 2024Sep 30, 2024Jun 30, 2024
Market Cap ($M)98,92272,76169,21773,46668,04938,96037,04227,69328,597
Enterprise Value ($M)101,50375,34271,97475,91569,99240,23138,35828,96129,879
Price to Earnings Ratio (P/E)-1122.43-793.62-1432.78-14499.32-337.17-256.11-721.72-451.40-473.76
Price/Earnings-to-Growth Ratio (PEG)—-193.16-153.44-1494.28-48.61-61.54-103.94-62.23-80.10
Price to Sales Ratio (P/S)42.48113.73112.64130.72132.8381.3280.5464.3971.32
Price to Book Ratio (P/B)64.3747.6647.4454.5454.8927.3235.4128.4632.44
Price to Free Cash Flow Ratio (P/FCF)278.24865.44444.58890.692044.73736.93775.69611.61747.16
Enterprise Value to Sales (EV/Sales)—117.77117.12135.07136.6283.9783.4067.3474.51
Enterprise Value to EBITDA (EV/EBITDA)736.131933.041600.661399.88-246451.685838.191428.701425.251763.71
Debt to Equity Ratio18.722.312.542.602.791.041.401.491.63

📘 Full Research Report

ℹ️

AI-Generated Research: This report is for informational purposes only.

📘 CLOUDFLARE INC CLASS A (NET) — Investment Overview

🧩 Business Model Overview

Cloudflare delivers performance and security services by operating a distributed edge network that sits between end users and customer-origin infrastructure (origins such as cloud storage, application servers, or enterprise data centers). Customers “route through” Cloudflare for traffic acceleration and policy enforcement, enabling Cloudflare to inspect, filter, and optimize requests at the edge rather than relying solely on origin-side controls.

The value chain is centered on (1) network capacity and routing (global footprint, Anycast architecture), (2) software services that implement security and performance policies (e.g., DDoS mitigation, web application security, traffic optimization), and (3) customer configuration that persists as a durable workflow (routing rules, security policies, authentication, and API-driven controls).

💰 Revenue Streams & Monetisation Model

Revenue is predominantly recurring, with monetisation tied to usage characteristics and contracted service tiers. The main streams typically include:

  • Subscription/plan revenue driven by security and performance features, commonly offered in tiered bundles that scale with required capabilities.
  • Usage-based revenue that scales with traffic volume, security events/requests, and compute-like edge capabilities (where applicable), aligning revenue with customer demand for protection and acceleration.
  • Enterprise/platform revenue that bundles advanced security controls, support, and managed features, often supporting higher-value deployments.

Margin drivers are primarily (1) the mix of subscription features versus usage-heavy components, (2) network efficiency and utilization of edge infrastructure, and (3) cost discipline in engineering, support, and infrastructure scaling. Over time, software contribution tends to be an important lever, but network operations and bandwidth-related expenses remain central to the cost structure.

🧠 Competitive Advantages & Market Positioning

Cloudflare’s moat is rooted in high switching costs (workflow/data gravity) plus an operational network advantage—a large, distributed edge that is difficult to replicate economically and that continuously improves service quality through scale.

  • High switching costs (data/workflow gravity): Once traffic is routed through Cloudflare, customers embed Cloudflare into core operations—DNS/routing integration, security policy configuration, identity/authentication flows, application-layer protections, and edge rules. Replacing these capabilities typically requires re-architecting traffic routing and rebuilding comparable security policies, creating friction and time risk.
  • Intangible/operational advantage: The combination of global routing infrastructure, security tooling, and large-scale threat and performance telemetry supports faster policy iteration and service refinement. Competitors can build point solutions, but matching the depth of operational integration is more challenging.
  • Network effects (practical, not “social”): Security and performance systems benefit from scale—larger volumes of observable events can improve detection and tuning of protective measures. The effect strengthens as the platform attracts and retains high-quality traffic flows and configurations.

Competitive benchmarking:

  • Akamai: Strong incumbent in CDN and security; competes heavily on enterprise performance and security suites. Cloudflare’s differentiation is typically the breadth of security/edge routing as an integrated platform and faster deployment model for many customers.
  • Fastly: More focused on edge compute and traffic delivery; competes on developer-friendly capabilities. Cloudflare generally benefits from deeper breadth in security and a larger, more comprehensive network deployment.
  • AWS (WAF/Shield/CDN) and Google Cloud (security/CDN offerings): Cloud hyperscalers offer bundled security and traffic services that can be cost-attractive for organizations already standardized on those clouds. Cloudflare’s positioning targets customers that want consistent protection and performance across heterogeneous hosting environments and require platform-level routing/security orchestration.

Overall, Cloudflare emphasizes an “edge-first security and performance platform” approach rather than competing narrowly within CDN or only within a single cloud provider’s ecosystem.

🚀 Multi-Year Growth Drivers

Over a 5–10 year horizon, growth is supported by several structural trends that expand both usage and the willingness to pay for layered protection:

  • Shift from perimeter to application-layer security: Rising sophistication and frequency of web and API attacks increase demand for edge-delivered mitigations and policy enforcement.
  • Cloud and hybrid architectures: Customers increasingly deploy across multiple clouds and environments, supporting the case for a vendor that can provide consistent traffic control independent of origin location.
  • Edge adoption and latency-sensitive workloads: More applications require near-user performance, making globally distributed routing and caching relevant beyond traditional content delivery.
  • Zero Trust and granular access controls: Growing adoption of identity-aware protections and fine-grained rules increases entrenchment of Cloudflare’s configuration workflows.
  • Developer ecosystem expansion: As developers embed edge routing, security controls, and APIs into production workflows, switching friction increases and distribution via integrations supports sustained seat and usage growth.

⚠ Risk Factors to Monitor

  • Competition and bundling pressure: Incumbents in CDN/security and hyperscaler-native services can compress pricing or shift deals toward bundles, especially for customers with standardized cloud footprints.
  • Technology and product substitution: Security tooling and edge delivery capabilities can be replicated to a degree; maintaining differentiation depends on continuous improvements in automation, detection quality, and policy effectiveness.
  • Infrastructure cost curve and utilization risk: Maintaining and expanding a global edge network requires capital and operational expense discipline. Any mismatch between capacity growth and demand can pressure margins.
  • Operational and security incidents: As a core traffic and security layer for many customers, reliability and incident response capabilities are critical. Material outages or vulnerabilities could impair trust and renewal behavior.
  • Regulatory and privacy constraints: Data handling, logging, and cross-border operational practices may face evolving regulatory requirements, affecting product design and compliance costs.

📊 Valuation & Market View

Equity valuation for a platform like Cloudflare often reflects characteristics common to high-scale software/network businesses: revenue growth durability, gross margin trajectory, operating leverage, and the path to sustained free cash flow generation. Investors typically focus on:

  • Revenue quality: recurring subscription contribution versus usage sensitivity
  • Unit economics: gross margin trends and the cost-to-serve curve as traffic scales
  • Operating leverage: efficiency in sales and R&D spend relative to revenue growth
  • Cash flow conversion: the ability to fund network needs while expanding margins

In this sector, valuation multiples tend to expand when the market perceives improving scalability (cost curve benefits), higher enterprise penetration, and durable customer retention; multiples compress when growth decelerates, competition intensifies, or cost structure trends worsen.

🔍 Investment Takeaway

Cloudflare’s long-term investment case rests on an edge-delivered security and performance platform with meaningful switching costs driven by embedded routing and security workflows, reinforced by an operational advantage from a large distributed network. The market opportunity is supported by sustained demand for application-layer protection, latency-sensitive delivery, and hybrid/multi-cloud traffic control. The primary debate centers on competitive pressure from CDN/security incumbents and hyperscaler bundles, alongside the ongoing need to manage infrastructure cost curve and reliability.


⚠ AI-generated — informational only. Validate using filings before investing.

📰 Market News & Coverage

15 Stories Available

Real-time institutional reporting and market updates for NET.

defenseworld.net•2026-07-29

Cloudflare, Inc. $NET Shares Purchased by Altshuler Shaham Ltd

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defenseworld.net•2026-07-28

Bank of Nova Scotia Has $6.17 Million Holdings in Cloudflare, Inc. $NET

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FLAGSTAR BANK REPORTS SECOND QUARTER 2026 NET INCOME ATTRIBUTABLE TO COMMON STOCKHOLDERS OF $0.06 PER DILUTED SHARE AND ADJUSTED NET INCOME ATTRIBUTABLE TO COMMON STOCKHOLDERS OF $0.05 PER DILUTED SHARE

ANNOUNCES $250 MILLION SHARE REPURCHASE PROGRAM THIRD CONSECUTIVE QUARTER OF PROFITABILITY AS PRE-PROVISION NET REVENUES INCREASED $34 MILLION ON AN UNADJUSTED BASIS AND $21 MILLION ON AN ADJUSTED BASIS COST OF DEPOSITS DECLINED FIVE BASIS POINTS, WHILE TOTAL DEPOSITS INCREASED NEARLY $700 MILLION IN THE SECOND QUARTER AND APPROXIMATELY $1.5 BILLION YEAR-TO-DATE BALANCE SHEET GREW APPROXIMATELY $600 MILLION DRIVEN BY SOLID CORE C&I LOAN AND DEPOSIT GROWTH FROM CONTINUED EXPANSION OF THE COMMERCIAL BANKING PLATFORM C&I LOANS INCREASED $2.0 BILLION OR 12% QUARTER OVER QUARTER DRIVEN BY STRATEGIC FOCUS AREAS CONTINUED EXPENSE DISCIPLINE WITH OPERATING EXPENSES DOWN 3% COMPARED TO PRIOR QUARTER; POSITIVE OPERATING LEVERAGE OF 7% CRE PAR PAYOFFS TOTALED $1.1 BILLION, OF WHICH 39% WERE SUBSTANDARD; CRE CONCENTRATION RATIO IMPROVED TO 350% COMPARED TO 367% LAST QUARTER CET1 CAPITAL RATIO OF 13.16% Second Quarter 2026 Summary Compared to First Quarter 2026 Profitability Capital   PPNR of $66 million , up $34 million Adjusted PPNR of $62 million , up $21 million or 51% Operating expenses of $427 million down 3% Positive operating leverage of 7% Net interest margin was relatively unchanged at 2.13% Deposit costs declined 5 basis points while overall cost of funds declined 7 basis points     CET1 capital ratio of 13.16%, at or above peer group levels Excess capital of $1.6 billion, using low end of target CET1 range of 10.5% Book value per share of $18.31 Tangible book value per share of $17.51 Tangible book value per share adjusted for warrant exercise is $15.54   Balance Sheet Asset Quality   Total C&I loans increased $2.0 billion or 12% to $18.6 billion Total loans increased $562 million to $61.0 billion , up 1% or 4% annualized Total deposits increased $689 million or 1% Core deposits grew $644 million or 1% C&I and Private Bank deposits grew $905 million , up 4% Strategic C&I loan focus areas grew $2.1 billion or 29% Total MF/CRE exposure down $1.5 billion or 4% Wholesale borrowings, mainly FHLB advances, declined $250 million or 2%     Criticized/Classified loans declined $143 million or 1% Substandard loans declined $369 million or 6% Non-accrual loans rose $123 million or 5% Total ACL of $0.9 billion or 1.52% of total loans HFI Total multi-family ACL coverage of 1.63% ACL coverage of 2.87% for multi-family loans with 50% or greater rent-regulated units Total NYC multi-family loans declined $677 million or 5% Total NYC multi-family loans with 50% or greater rent-regulated units declined $338 million or 4% NCOs to average loans was 0.66% vs. 0.52%   Hicksville, N.Y.

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📊 AI Financial Analysis

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Earnings Data: Q Ending 2026-03-31

"NET reported Q1 2026 revenue of $639.8M and net loss of $22.9M (EPS: -$0.07). Revenue increased QoQ from $614.5M to $639.8M (+4.1%) and rose YoY from $479.1M (+33.5%). Net income improved QoQ (loss narrowed from -$12.1M to -$22.9M, i.e., worsening by -89.9%) but YoY it deteriorated (loss widened from -$38.5M to -$22.9M; actually less negative, so net income improved by +40.4%). Profitability is pressured: gross margin eased from 74.2% in Q4 2025 to 71.2% in Q1 2026, while operating and net margins remained negative (operating margin: -9.7%; net margin: -3.6%). The quarter also generated positive operating cash flow of $158.3M and free cash flow of $93.1M despite the net loss, supported by adjustments (e.g., stock-based compensation) and working-capital dynamics. Balance sheet resilience looks strong on liquidity: cash & short-term investments totaled $4.16B, and total assets were $6.16B. Leverage remains elevated with total debt of ~$3.52B and net debt of ~$2.59B, but cash coverage indicators are still supportive in the near term. Total shareholder returns appear strong given the stock’s 1-year price change of +83.5% and no dividend payments; buybacks/dividends were not evident in the provided cash flow."

Revenue Growth

Good

Revenue rose QoQ by +4.1% ($614.5M to $639.8M) and YoY by +33.5% ($479.1M to $639.8M), indicating strong top-line momentum.

Profitability

Neutral

Margins are still contracting: gross margin fell to 71.2% from 74.2% QoQ, and operating/net remained negative (operating margin -9.7%, net margin -3.6%). EPS was -$0.07 in Q1 2026.

Cash Flow Quality

Positive

Despite net loss (-$22.9M), operating cash flow was positive at $158.3M and free cash flow was $93.1M, suggesting cash generation remains intact.

Leverage & Balance Sheet

Neutral

Liquidity is solid (cash & ST investments $4.16B; total assets $6.16B) but leverage remains high (total debt ~$3.52B; net debt ~$2.59B). Equity remains positive at ~$1.53B.

Shareholder Returns

Strong

Strong capital appreciation: 1y_change +83.5% (well above +20% momentum). No dividend yield shown and buybacks were not reflected in provided cash flow.

Analyst Sentiment & Valuation

Neutral

Consensus price target is $216.43 versus current price $200.99 (modestly above current). Valuation multiples are not meaningful given negative earnings (P/E not applicable).

Disclaimer:This analysis is AI-generated for informational purposes only. Accuracy is not guaranteed and this does not constitute financial advice.

RevenueEarningsP/E RatioSharesDebtMargin %

Fundamentals Overview

Loading fundamentals overview...

Cloudflare started 2026 strongly: Q1 revenue rose 34% to $639.8M and free cash flow increased to $84.1M (13% of revenue), exceeding expectations. The growth story is driven by large-customer momentum (72% of revenue; $5M+ additions at a record pace) and rapid Workers adoption (developers to 5.5M+, +1M in the quarter). Agentic AI is the core catalyst: management claims hundreds of billions of agentic requests per month and internal AI usage up 600% (with Workers-based coding tools). Financial optics are mixed: gross margin fell to 72.8% (down 210 bps sequentially), mainly from paid/free traffic mix and cost allocation into cost of revenue, partially offset at the P&L level. In response to the agentic operating model, Cloudflare announced substantial restructuring/severance charges of $140M–$150M for full-year 2026, with most in Q2, while keeping AE capacity largely intact. Guidance remains solid: Q2 revenue $664M–$665M and full-year EPS $1.19–$1.20.

AI IconGrowth Catalysts

  • Record additions of $5M+ customers; $5M-plus customer count additions in Q1 matched all of 2025
  • Acceleration in hiring sales force capacity; fastest pace since 2023
  • Deals over $1M up 73% YoY (fastest since 2024)
  • Dollar-based net retention at 118% (down 2% sequentially, up 7% YoY) with quarterly gross retention highest in four years
  • Workers developer platform momentum: developers to 5.5M+ end of Q1 (+1.0M in the quarter vs +1.5M total in all of 2025)
  • AI/agentic workloads tailwind: usage of AI >600% in last three months; routing/controls for agentic traffic across network and Zero Trust/SASE

Business Development

  • Two-year $10.0M pool-of-funds contract (initial use cases: Application Services and Workers developer platform; expanded relationship; mentions full portfolio unlocked under single rate card)
  • Two-year $8.7M contract in APAC (Application Services + Workers developer platform); displaced a hyperscaler bid
  • Two-year $8.0M privacy proxy contract with a Fortune 100 technology company (fifth privacy engagement)
  • Five-year $5.1M contract with an EMEA insurance company for Application Services and full SASE portfolio (displaced six legacy vendors at signing; 10 more displacements underway)
  • Three-year $5.0M Zero Trust contract with a Fortune 500 aerospace and defense company (Browser Isolation, Access, Gateway) tied to compliance-driven replacement after a breach
  • One-year $4.1M contract with a leading AI company for Application Services; testing AI Gateway for AI workloads
  • 10-month $2.0M Argo Smart Routing contract with an AI company (latency reduced 30% after deploying Argo; signed Workers developer platform deal one quarter earlier)

AI IconFinancial Highlights

  • Revenue $639.8M, up 34% YoY
  • Operating income $73.1M; operating margin 11.4% (down 30 bps YoY)
  • Gross margin 72.8% (down 210 bps sequentially; down 130 bps YoY); attributed to paid vs free traffic mix and network cost allocation into cost of revenue (esp. Workers/developer products scaling at lower GM)
  • Free cash flow $84.1M; 13% of revenue (vs $52.9M; 11% of revenue YoY), exceeding expectations
  • Diluted net income per share (non-GAAP) $0.25 in Q1
  • Effective tax rate guidance: 21.5% in Q2; 20.5% for full-year 2026

AI IconCapital Funding

  • Restructuring/severance charges for full-year 2026: $140M to $150M (approximately $40M noncash; majority concentrated in Q2)
  • Ended Q1 with $4.2B cash, cash equivalents, and available-for-sale securities
  • No buyback amount or net debt figures provided in the transcript

AI IconStrategy & Ops

  • Agentic AI-first operating model: reduction of team size by >1,100 people (CEO); CFO describes approximately 20% reduction across functions and geographies
  • Severance/restructuring intended to accelerate operating model; stated not a cost-cutting exercise
  • Sales productivity and capacity expansion: revenue-side productivity increased for the ninth consecutive quarter; quota-carrying AE capacity expected to accelerate in 2026
  • Cost/gross margin dynamics: proactive optimization expected to shift traffic from free to paid and move costs into cost of revenue (GM headwind can be ‘a wash’ at P&L level)
  • AI internal scaling: Cloudflare OS harness with MCP servers and centrally managed skill files; production code reviewed by autonomous AI agents

AI IconMarket Outlook

  • Q2 2026 guidance: revenue $664M to $665M (+30% YoY); operating income $90M to $91M; effective tax rate 21.5%; diluted EPS $0.27 (377M shares assumed)
  • Full-year 2026 guidance: revenue $2.805B to $2.813B (+30% YoY at midpoint); operating income $418M to $421M; effective tax rate 20.5%; diluted EPS $1.19 to $1.20 (375M shares assumed)
  • Investor Day scheduled: Tuesday, June 9, 2026

AI IconRisks & Headwinds

  • Gross margin pressure: down 210 bps sequentially and down 130 bps YoY, driven by paid vs free traffic mix and network cost allocation into cost of revenue (Workers/developer products carry lower GM)
  • Net retention volatility acknowledged: dollar-based net retention down 2% sequentially (118%) despite strong new customer acceleration
  • Restructuring execution risk: $140M–$150M charges (majority in Q2) could temporarily impact financial optics and operating cadence
  • Competitive differentiation: claims that Act 1 competitors may not monetize agentic traffic similarly; implies competitive intensity in agentic monetization

Q&A: Analyst Interest

  • Traffic monetization vs peers: Management argued the key is traffic quality, not bandwidth. Cloudflare targets essential APIs/app traffic and “hundreds of billions of agentic requests per month,” using network guardrails. For Act 2, a unified Workers-based platform plus fine-grained data controls differentiates vs some competitors.
  • Timing and conservatism for restructuring guidance: Management said it wasn’t purely from weak results, but about roles needed for an agentic AI-first future. CFO stated they “hardly touched” AE/quota-carrying capacity and embedded residual risk conservatively in remaining-year guidance.
  • AI cost balancing and sovereign/data localization: Management cited 600% AI usage growth with costs rising less than expected, aided by routing and GPU utilization on Cloudflare infrastructure, plus Workers AI/Gateway to avoid marginal cost for simpler tasks. For sovereign needs, they highlighted Germany-level granularity and Zero Trust/SASE enforcement.

Sentiment: POSITIVE

Note: This summary was synthesized by AI from the NET Q1 2026 earnings transcript. Financial data is complex; please verify all metrics against official SEC filings before making investment decisions.

📋 Official Regulatory 10-K / 10-Q SEC Filings

Direct authenticated documentation links to audited SEC database reports for NET.

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SEC Filings (NET)

© 2026 Stock Market Info — Cloudflare, Inc. (NET) Financial Profile