Table of contents UNITED STATES SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 __________________________________________________ FORM 10-Q __________________________________________________ (Mark One) ☒ QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the quarterly period ended June 30, 2023 or ☐ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the transition period from to Commission file number: 001-39039 __ ...

Cloudflare, Inc. (NYSE:NET) Jefferies 2023 Software Conference May 31, 2023 2:00 PM ET Company Participants Thomas Seifert - Chief Financial Officer Phil Winslow - VP of Strategic Finance, Treasury & IR Conference Call Participants Brent Thill - Jefferies Brent Thill We're here with Thomas Seifert, CFO of Cloudflare. He's been CFO since June of 2017. Special thanks to Phil Winslow as well, sitting here as well. Joined the company recently, and thanks for being here and supporting the event. So reach out to ...

Cloudflare, Inc. (NYSE:NET) Q1 2023 Results Conference Call April 27, 2023 5:00 PM ET Company Participants Phil Winslow - IR Matthew Prince - CEO Thomas Seifert - CFO Conference Call Participants Sterling Auty - Moffett Nathanson Thomas Blakey - KeyBanc Brent Thill - Jefferies Matt Hedberg - RBC Capital Markets Keith Weiss - Morgan Stanley James Fish - Piper Sandler Joel Fishbein - Truist Mark Murphy - JPMorgan Operator Good afternoon, ladies and gentlemen, and welcome to the Cloudflare Q1 2023 Earnings Con ...

Table of contents UNITED STATES SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 __________________________________________________ FORM 10-Q __________________________________________________ (Mark One) ☒ QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 or For the quarterly period ended March 31, 2023 ☐ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 (Registrant's telephone number, including area code) ________________ ...

Cloudflare, Inc. (NYSE:NET) Morgan Stanley Technology, Media & Telecom Conference March 8, 2023 3:15 PM ET Company Participants Thomas Seifert - CFO Conference Call Participants Keith Weiss - Morgan Stanley Keith Weiss Excellent. Thank you, everyone, for joining us. My name is Keith Weiss. I run the U.S. software equity research franchise here at Morgan Stanley. I have our European software analysts in the front row. So I have to qualify that to just the U.S. to get them at it. And very pleased to have with ...

As of December 31, 2022 Investor Presentation This presentation and the accompanying oral commentary contain express and implied "forward-looking" statements within the meaning of the federal securities laws, and these statements involve substantial risks, assumptions, and uncertainties. All statements other than statements of historical fact could be deemed forward-looking, including, but not limited to, the current and planned functionality of our products, expectations of future operating results or fina ...

Customer Base and Revenue - As of December 31, 2022, the company had over 162,000 paying customers across more than 180 countries, up from 2,042 paying customers in 2022 compared to 1,416 in 2021, and 828 in 2020[51] - No single customer accounted for more than 10% of the company's revenue in the years ended December 31, 2022, 2021, or 2020[51] - Total revenues for the year ended December 31, 2022, were $975.2 million, generated from pay-as-you-go and contracted customers[472] - Total revenue for 2022 was $975,241,000, representing a 48.7% increase from $656,426,000 in 2021[480] - Revenue from the United States accounted for 53% of total revenue in 2022, amounting to $515.7 million, compared to 52% in 2021[555] - The company recognized $116.0 million in revenue from contract liabilities for the year ended December 31, 2022, up from $55.3 million in 2021[556] Financial Performance - Gross profit for 2022 was $742,631,000, up from $509,292,000 in 2021, indicating a significant growth in profitability[480] - Operating expenses increased to $943,834,000 in 2022, compared to $636,976,000 in 2021, reflecting a rise of 48%[480] - The net loss for 2022 was $193,381,000, an improvement from a net loss of $260,309,000 in 2021[482] - The company reported a comprehensive loss of $202,632,000 for 2022, compared to $263,117,000 in 2021[482] - The company recorded a cumulative effect adjustment from the adoption of ASU 2020-06, resulting in a reduction of $284.437 million in equity[489] - The total comprehensive loss for the year was $9.251 million, highlighting the impact of market conditions on overall financial performance[489] Cash and Investments - As of December 31, 2022, the company had cash and cash equivalents of $204.2 million and available-for-sale securities of $1,445.8 million[448] - Cash and cash equivalents decreased to $204,178,000 as of December 31, 2022, down from $313,777,000 in 2021[478] - The company ended the year with cash, cash equivalents, and restricted cash totaling $215,204, down from $320,958 at the end of 2021[492] - The amortized cost of available-for-sale investments with maturities less than one year was $1,251.6 million as of December 31, 2022, compared to $966.3 million as of December 31, 2021[566] - The net unrealized loss on investments as of December 31, 2022, was $11.9 million, an increase from a net unrealized loss of $2.7 million as of December 31, 2021[567] Employee and Operational Insights - The company has approximately 3,217 full-time employees as of December 31, 2022, with a strong focus on employee relations and culture[83] - Stock-based compensation expenses amounted to $208.700 million for the year, indicating significant investment in employee incentives[489] - The Company capitalizes sales commissions related to contract acquisition, amortizing initial contract commissions over an estimated benefit period of three years[510] - Research and development expenses primarily consist of employee-related costs, including salaries, bonuses, and benefits, aimed at enhancing existing offerings and ensuring network reliability[514] Strategic Initiatives and Product Development - The company launched several new products, including Durable Objects, Cloudflare Pages, and Cloudflare Stream, aimed at enhancing customer collaboration and content delivery[54] - The company has extended its Project Galileo initiative to over 2,000 recipients, providing free security services to at-risk public interest groups[62] - The company has provided security services to more than 350 state and local election websites through the Athenian Project[62] - The company prioritizes investment in research and development, resulting in the launch of new products that attract new customers[69] - The company emphasizes a competitive advantage through its cloud-based, multitenant approach, which is better suited for an increasingly cloud-based world[79] Financial Controls and Reporting - The company maintains effective internal control over financial reporting as of December 31, 2022, based on established criteria[462] - The company does not believe that a hypothetical 10% increase or decrease in interest rates would have a material impact on its consolidated financial statements[453] - The majority of the company's revenue is denominated in U.S. dollars, while expenses are generally in local currencies, exposing the company to foreign currency exchange rate fluctuations[454] - The company has not had a formal hedging program for foreign currency but may consider it if exposure becomes significant[454] Assets and Liabilities - Total assets increased to $2,587,908,000 in 2022, up from $2,372,071,000 in 2021, reflecting overall growth in the company's financial position[478] - The company’s additional paid-in capital decreased to $1,475,423,000 in 2022 from $1,494,512,000 in 2021, indicating changes in equity financing[478] - The company’s deferred contract acquisition costs increased to $93.1 million as of December 31, 2022, from $70.3 million in 2021[557] - Total lease payments due as of December 31, 2022, amount to $158.045 million, with total operating lease liabilities at $140.899 million after accounting for imputed interest[585] Acquisitions and Goodwill - The Company recorded $120.8 million of goodwill in connection with the acquisition of Area 1 Security, Inc. during the year ended December 31, 2022[574] - The Company recorded $30.0 million of developed technology in connection with the acquisition of Area 1 for the year ended December 31, 2022[576] - The Company did not recognize any goodwill impairment charges for the years ended December 31, 2022, 2021, and 2020[542]

Financial Data and Key Metrics Changes - The company generated $274.7 million in revenue for Q4 2022, representing a 42% year-over-year increase [35] - Operating profit reached a record $16.8 million, with an operating margin of over 6% [35] - Free cash flow for the quarter was $34 million, equating to a free cash flow margin of 12% [37] - Gross margin was over 77%, exceeding the long-term target range of 75% to 77% [37] - The dollar-based net retention rate decreased to 122%, down 200 basis points sequentially and 300 basis points year-over-year [61] Business Line Data and Key Metrics Changes - The company added 134 large customers (those paying over $100,000 annually), totaling 2,042 large customers, which now contribute 63% of total revenue [39][60] - Revenue from large customers grew 56% year-over-year [39] - The company saw a record number of net new customers paying over $500,000 annually [59] Market Data and Key Metrics Changes - U.S. revenue represented 53% of total revenue, increasing 44% year-over-year; EMEA accounted for 27% with a 42% increase; APAC represented 13% with a 40% increase [57] - The total number of paying customers reached 162,086, with an addition of approximately 22,000 customers in 2022, marking a 16% year-over-year increase [58] Company Strategy and Development Direction - The company aims to build a leading sales organization and is focusing on optimizing its go-to-market strategy [52] - The leadership team is committed to achieving $5 billion in annualized revenue within five years while maintaining profitability [81] - The company is enhancing its marketing and sales efforts to better compete in the Zero Trust and cloud security markets [43][45] Management's Comments on Operating Environment and Future Outlook - Management acknowledged the economic uncertainty leading to longer decision-making processes and sales cycles, impacting revenue growth [80] - The company is not factoring in any improvement in the macroeconomic environment for its 2023 guidance, maintaining a conservative outlook [67][91] - Management expressed confidence in the company's ability to generate free cash flow and improve operational efficiency despite current challenges [92][93] Other Important Information - The company received FedRAMP certification, covering nearly its full suite of products, which is expected to enhance its public sector opportunities [76] - A significant $7.2 million five-year deal with the U.S. government was secured, showcasing the company's capabilities in cybersecurity [77] Q&A Session Summary Question: What drives the conservatism in the 2023 revenue outlook? - Management emphasized a prudent approach, not assuming any macroeconomic improvements and focusing on controllable initiatives to accelerate sales productivity [98] Question: How are new products performing in a challenging sales environment? - Management noted that while new products are ramping up, the impact on dollar-based net retention will take time to reflect in the numbers [115] Question: What are the barriers to entry for competitors? - Management highlighted the significant network effects and the difficulty for new entrants to replicate the existing infrastructure and services [120]

Cloudflare, Inc. (NYSE:NET) Credit Suisse 26th Annual Technology Conference November 30, 2022 3:00 PM ET Company Participants Thomas Seifert ??? Chief Financial Officer Conference Call Participants Phil Winslow ??? Credit Suisse Phil Winslow All right. All right. Good afternoon, everyone. Welcome to the Final Day of the Credit Suisse 26th Annual Technology Conference. My name is Phil Winslow. I???m the software analyst. I recognize many of you from prior sessions, so thank you joining us as always. Very exc ...

Cloudflare, Inc. (NYSE:NET) Q3 2022 Earnings Conference Call November 3, 2022 5:00 PM ET Company Participants Jayson Noland - Head, IR Matthew Prince - Co-Founder, Chairman & CEO Chris Merritt - Chief Revenue Officer Marc Boroditsky - President of Revenue Thomas Seifert - CFO Conference Call Participants Philip Winslow - Cr??dit Suisse Matthew Hedberg - RBC Capital Markets Brent Thill - Jefferies Hamza Fodderwala - Morgan Stanley James Fish - Piper Sandler & Co. James Breen - William Blair & Company Fatima ...