Summary
Cloudflare, Inc. reported strong revenue growth for the nine months ended September 30, 2023, with revenue increasing by 33% year-over-year to $934.3 million. The company's strategy of acquiring new paying customers and expanding relationships with existing ones, as evidenced by a dollar-based net retention rate of 116%, continues to drive top-line performance. Despite revenue growth, Cloudflare remains unprofitable, reporting a net loss of $156.1 million for the nine months. Operationally, the company has achieved positive free cash flow for the first nine months of the year ($68.7 million), a significant improvement from the prior year. This indicates progress in managing expenses and converting revenue into cash. The company's balance sheet remains solid with $94.1 million in cash and cash equivalents and $1.48 billion in available-for-sale securities as of September 30, 2023. However, the significant accumulated deficit of $996 million and outstanding convertible notes warrant continued investor attention.
Financial Highlights
51 data points| Revenue | $335.60M |
| Cost of Revenue | $78.07M |
| Gross Profit | $257.53M |
| R&D Expenses | $90.59M |
| Operating Expenses | $296.75M |
| Operating Income | -$39.21M |
| Interest Expense | $1.14M |
| Net Income | -$23.54M |
| EPS (Basic) | $-0.07 |
| EPS (Diluted) | $-0.07 |
| Shares Outstanding (Basic) | 334.67M |
| Shares Outstanding (Diluted) | 334.67M |
Key Highlights
- 1Revenue for the nine months ended September 30, 2023, increased 33% year-over-year to $934.3 million.
- 2The company reported a dollar-based net retention rate of 116% for the three months ended September 30, 2023, indicating successful expansion with existing customers.
- 3Cloudflare generated $68.7 million in free cash flow for the nine months ended September 30, 2023, a substantial increase from the prior year.
- 4The number of paying customers grew by 17% year-over-year as of September 30, 2023.
- 5Large customers (>$100,000 Annualized Revenue) increased by 34% year-over-year to 2,558 as of September 30, 2023.
- 6The company continues to invest heavily in sales and marketing, and research and development, leading to increased operating expenses and a net loss of $156.1 million for the nine months.