Cloudflare, Inc. (NET) Stock Analysis

Cloudflare reported $2.168 billion in revenue in 2025, growing from $1.670 billion in 2024 and $1.297 billion in 2023, while net losses narrowed to $102.3 million against an accumulated deficit of $1,204.9 million at December 31, 2025. The network spans more than 330 cities in over 125 countries, interconnecting with over 13,000 networks globally; the paying customer base reached 332,000 across more than 190 countries, including 4,298 large customers. No single customer accounted for more than 10% of revenue in any of the three years ended December 31, 2025.

Cloudflare sells subscription-based services across three primary lines: application services (web application firewall, DDoS mitigation, bot management, API security), a SASE platform (Zero Trust network access, Magic WAN, Secure Web Gateway, Cloud Email Security), and developer-based solutions (Cloudflare Workers compute, R2 Object Storage, Workers AI, D1 serverless databases). Contracted Enterprise customers sign agreements typically ranging from one to three years; pay-as-you-go customers on Pro and Business plans pay monthly or annually and may cancel with little notice. The serverless network architecture runs every service on every server in every city, allowing the company to monetize idle capacity through a free tier that attracts ISP interconnect partnerships and reduces co-location and bandwidth costs — dynamics that grow more powerful as the network expands. The company achieved FedRAMP moderate authorization in 2022, opening the U.S. federal market. The 10-K notes that large customers — 4,298 at year-end 2025 — carry elevated churn risk and longer sales cycles relative to smaller customers, and that some Enterprise agreements allow termination without cause.