NYSE$NET

Cloudflare · Q3 2021 earnings

Q3 2021 earnings · · Investor relations

Briefing

Cloudflare's revenue increased by 51% year-over-year, with strong large customer growth and the achievement of profitability.

Cloudflare reported a landmark third quarter with revenue growth of 51% year-over-year. The company added roughly 170 large customers, bringing the total to 1,260. Cloudflare achieved profitability, reaching this milestone a year ahead of schedule.

  • Total revenue reached $172.3 million, a 51% increase year-over-year.
  • The company added a record of approximately 170 large customers, bringing the total to 1,260.
  • GAAP net loss was $107.3 million, while non-GAAP net income was $1.4 million.
  • Cloudflare achieved profitability, reaching the milestone a year ahead of the original timeline.

Headline financials

Total Revenue

$172M

Previous: $114M+51.0%
EPS (adj)

-$0.34

Previous: -$0.02-1606.2%
Gross Margin

78.2%

Previous: 76.3%+2.5%
Free Cash Flow Margin

-23.0%

Previous: -16.0%-43.8%
Capital Expenditures

-$64.7M

Previous: -$46M-40.7%
Free Cash Flow

-$172M

Previous: -$72.4M-137.5%
Net Income

-$107M

Previous: -$26.5M-305.5%
Operating Income

-$26.5M

Previous: -$21.3M-24.7%
Gross Profit

$135M

Previous: $87.2M+54.7%
Cash & Equivalents

$618M

Previous: $112M+452.2%
Total Assets

$2.32B

Previous: $1.37B+68.9%
Stock-Based Comp

$23M

Previous: $14.7M+56.3%

Revenue & EPS history

Cloudflare · Revenue · Quarterly

$172M

Q3 2021+51%vs Q3 2020
Beat estimate in 11 of 12 quarters(92%)
ActualEstimate

Forward guidance

For the fourth quarter of fiscal 2021, Cloudflare expects total revenue of $184.0 to $185.0 million, non-GAAP income (loss) from operations of $(1.0) to $0.0 million, and non-GAAP net income (loss) per share of $(0.01) to $0.00. For the full year fiscal 2021, the company expects total revenue of $647.0 to $648.0 million, non-GAAP loss from operations of $10.5 to $9.5 million, and non-GAAP net loss per share of $0.06 to $0.05.

Tailwinds

  • Total revenue of $184.0 to $185.0 million is expected for Q4 2021.
  • Non-GAAP income (loss) from operations of $(1.0) to $0.0 million is anticipated for Q4 2021.
  • Non-GAAP net income (loss) per share of $(0.01) to $0.00 is expected for Q4 2021.
  • Total revenue of $647.0 to $648.0 million is projected for the full year fiscal 2021.
  • Non-GAAP loss from operations of $10.5 to $9.5 million is expected for the full year fiscal 2021.

Headwinds

  • Non-GAAP income (loss) from operations is expected to be between $(1.0) to $0.0 million for Q4 2021.
  • Non-GAAP net income (loss) per share is projected to be between $(0.01) to $0.00 for Q4 2021.
  • Non-GAAP loss from operations is anticipated to be between $10.5 to $9.5 million for the full year fiscal 2021.
  • The forward-looking statements are subject to uncertainty due to the ongoing COVID-19 pandemic.
  • The financial outlook is dependent on numerous factors that Cloudflare may not be able to predict or control.

Historical earnings impact

How earnings announcements have historically affected this stock's price.

Avg. return before/after earnings

Based on 20 quarterly earnings reports · overlaid with Q3 2021

Historical avgQ3 2021

+0.3%

Avg return

Earnings day

+0.7%

Avg return

5 days after

+2.6%

Avg return

30 days after

48%

13 / 27 earnings

Positive

+29.5%

Q4 2023

Best reaction

-27.4%

Q1 2022

Worst reaction

Earnings price reactions
QuarterReport dateReaction (Day 0)+5 days+30 days
Q1 2026-23.8%-25.0%-2.6%
Q4 2025+5.2%+8.8%+18.0%
Q3 2025+11.6%+2.7%-10.0%
Q2 2025-3.6%+3.8%+0.5%
Q1 2025+6.3%+24.3%+44.5%
Q4 2024+17.8%+22.1%-10.4%
Q3 2024-1.4%-1.7%+22.1%
Q2 2024+2.5%-1.6%+6.0%
Q1 2024-15.5%-15.8%-23.1%
Q4 2023+29.5%+19.8%+17.6%
Q3 2023+17.2%+20.1%+43.4%
Q2 2023+8.4%+3.9%-0.2%
Q1 2023-21.0%-28.0%+2.7%
Q4 2022+3.5%+17.8%-9.2%
Q3 2022-17.7%-19.2%-3.1%
Q2 2022+27.2%+22.7%+0.6%
Q1 2022-27.4%-37.0%-39.7%
Q4 2021-8.6%+0.5%-22.7%
Q3 2021+1.2%+5.0%-18.0%
Q2 2021-1.0%+4.6%+8.7%
Q1 2021-9.4%-9.8%+5.1%
Q4 2020-5.5%-9.7%-16.1%
Q3 2020+14.9%+9.1%+37.8%
Q2 2020-5.7%-11.0%-18.2%
Q1 2020+5.3%+15.4%+16.8%
Q4 2019-0.4%-1.8%+7.0%
Q3 2019-0.6%-0.4%+13.9%
Q2 2019
Q1 2019
Q4 2018
Q3 2018
Q2 2018
Q1 2018

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