Cloudflare (NYSE:NET) Issues Earnings Results

06 Nov 2026, 03:11 by Mitch Edgeman · The Markets Daily

Cloudflare (NYSE:NET – Get Free Report) released its quarterly earnings results on Thursday. The company reported $0.38 EPS for the quarter, beating analysts’ consensus estimates of $0.34 by $0.04, FiscalAI reports. The firm had revenue of $782.51 million for the quarter, compared to analyst estimates of $737.16 million. Cloudflare had a negative net margin of 8.21% and a negative return on equity of 3.88%. The company’s revenue for the quarter was up 39.2% compared to the same quarter last year. During the same period in the previous year, the business earned $0.27 earnings per share.

Here are the key takeaways from Cloudflare’s conference call:

Cloudflare reported Q3 revenue of $782.5 million, up 39% year over year, its fastest growth in nearly four years. Large-customer momentum remained strong, with dollar-based net retention rising to 122% and more than 5,000 customers now spending over $100,000 annually.
Profitability improved alongside growth: adjusted operating income rose 60% to $137.1 million, and operating margin expanded to a record 17.5%. Management also expects to reach GAAP profitability in Q4, earlier than previously anticipated.
Demand indicators were robust, including a record 158,000 net new paying customers, record additions across large-customer cohorts, and RPO growth of 34% year over year. Management said consumption-based revenue and customers drawing down pool-of-funds contracts faster helped drive the quarter’s upside.
Q4 guidance calls for revenue of $845 million–$846 million, up 38% year over year; full-year 2026 revenue is expected to grow 37%. Management attributed momentum to broad demand across industries, including for security and its Workers developer platform.
Gross margin fell 290 basis points year over year to 72.4%, which management linked in part to strong growth in the Workers platform; free-cash-flow margin also declined to 10% from 13% a year earlier. Management expects full-year network capital expenditure to remain elevated at 14%–15% of revenue.

Cloudflare Stock Performance

NYSE:NET traded down $22.79 during trading hours on Thursday, hitting $243.79. 8,454,470 shares of the stock were exchanged, compared to its average volume of 3,293,286. The company has a quick ratio of 1.82, a current ratio of 1.82 and a debt-to-equity ratio of 1.22. The company’s 50 day moving average is $319.02 and its two-hundred day moving average is $249.31. Cloudflare has a twelve month low of $158.83 and a twelve month high of $370.35.

Insider Activity

In other news, insider Michelle Zatlyn sold 33,003 shares of the business’s stock in a transaction on Wednesday, October 7th. The stock was sold at an average price of $348.29, for a total transaction of $11,494,614.87. Following the completion of the sale, the insider owned 69,775 shares in the company, valued at $24,301,934.75. The trade was a 32.11% decrease in their ownership of the stock. The transaction was disclosed in a legal filing with the SEC, which is available through this link. The transaction was executed under a pre-arranged Rule 10b5-1 trading plan. Also, Director Carl Ledbetter sold 5,000 shares of the firm’s stock in a transaction dated Monday, October 19th. The shares were sold at an average price of $304.40, for a total value of $1,522,000.00. Following the completion of the transaction, the director owned 868,073 shares in the company, valued at approximately $264,241,421.20. This represents a 0.57% decrease in their position. The disclosure for this sale is available in the SEC filing. The transaction was executed under a pre-arranged Rule 10b5-1 trading plan. In the last ninety days, insiders sold 259,057 shares of company stock valued at $79,516,905. Company insiders own 10.66% of the company’s stock.

Wall Street Analysts Forecast Growth

NET has been the subject of several recent analyst reports. Weiss Ratings reaffirmed a “sell (d-)” rating on shares of Cloudflare in a report on Thursday, October 15th. TD Cowen lowered Cloudflare from a “buy” rating to a “hold” rating in a research report on Tuesday. BTIG Research raised their price target on Cloudflare from $382.00 to $413.00 and gave the company a “buy” rating in a report on Tuesday, October 6th. Raymond James Financial cut Cloudflare from a “strong-buy” rating to an “underperform” rating in a report on Tuesday. Finally, Royal Bank Of Canada lifted their price objective on Cloudflare from $290.00 to $346.00 and gave the company an “outperform” rating in a research report on Friday, August 7th. Twenty-four equities research analysts have rated the stock with a Buy rating, eight have issued a Hold rating and five have assigned a Sell rating to the company. Based on data from MarketBeat.com, Cloudflare currently has an average rating of “Moderate Buy” and a consensus price target of $333.21.

Get Our Latest Stock Report on Cloudflare

Cloudflare News Summary

Here are the key news stories impacting Cloudflare this week:

Positive Sentiment: Cloudflare reported quarterly earnings of $0.38 per share, above analyst estimates, while revenue rose 39.2% year over year to $782.51 million and also topped expectations. Zacks earnings article
Positive Sentiment: The company raised its full-year revenue outlook to about $2.96 billion, up from its prior range of $2.86 billion to $2.87 billion, signaling confidence in continued growth. Wall Street Journal outlook article
Neutral Sentiment: Cloudflare appointed Christian Smith as President of Revenue to lead its worldwide go-to-market organization and support its growth ambitions. Appointment announcement
Negative Sentiment: Cloudflare fell alongside other cybersecurity stocks amid a broader pullback in AI-related shares, suggesting sector-wide selling contributed to the decline. TIKR market article
Negative Sentiment: Valuation concerns and recent share-price weakness had weighed on sentiment ahead of earnings. This may help explain why strong results and guidance did not prevent a pullback. Invezz article

Cloudflare Company Profile

(Get Free Report)

Cloudflare, Inc (NYSE: NET) provides cloud connectivity, security and performance services for websites, applications, corporate networks and other internet-connected resources. Its global network is designed to help organizations improve the reliability, speed and security of digital services while reducing the complexity of managing internet infrastructure.