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Cloudflare
🇺🇸 NYSE:NET
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Jun 30, 2020

Cloudflare Q2 2020 Earnings Report

Cloudflare's second quarter results demonstrated strong revenue growth and customer acquisition.

Key Takeaways

Cloudflare announced strong second quarter results with a 48% year-over-year revenue increase, reaching $99.7 million. The company also improved both GAAP and non-GAAP operating margins and added a record number of large and paying customers.

Revenue increased by 48% year-over-year, totaling $99.7 million.

GAAP operating margin improved by 450 basis points year-over-year, while non-GAAP operating margin improved by 1,820 basis points year-over-year.

GAAP net loss per share improved by $0.14 year-over-year, and non-GAAP net loss per share improved by $0.19 year-over-year.

Net cash flow from operations was $4.0 million, compared to negative $2.9 million in the second quarter of 2019.

Total Revenue
$99.7M
Previous year: $67.4M
+47.9%
EPS
-$0.03
Previous year: -$0.0672
-55.3%
Gross Margin
75.8%
Previous year: 78%
-2.8%
Free Cash Flow Margin
-20%
Previous year: -25%
-20.0%
Gross Profit
$75.6M
Previous year: $52.6M
+43.7%
Cash and Equivalents
$314M
Free Cash Flow
-$20.2M
Total Assets
$1.36B

Cloudflare

Cloudflare

Forward Guidance

For the third quarter of fiscal 2020, Cloudflare expects total revenue of $102.5 to $103.5 million, non-GAAP loss from operations of $16 to $15 million, and non-GAAP net loss per share of $0.06 to $0.05. For the full year fiscal 2020, the company expects total revenue of $404 to $408 million, non-GAAP loss from operations of $55 to $53 million, and non-GAAP net loss per share of $0.18 to $0.17.

Positive Outlook

  • Total revenue of $102.5 to $103.5 million is expected for Q3 2020.
  • Full year revenue is projected to be between $404 and $408 million.
  • Non-GAAP loss from operations is expected to improve to $16 to $15 million for Q3 2020.
  • Full year non-GAAP loss from operations is expected to be $55 to $53 million.
  • Non-GAAP net loss per share is expected to be $0.06 to $0.05 for Q3 2020.

Challenges Ahead

  • The forward-looking statements are subject to substantial uncertainty due to the COVID-19 pandemic.
  • The estimates are based on conditions as of August 6, 2020, regarding the impact of the pandemic on operations.
  • The estimates are highly dependent on numerous factors that Cloudflare may not be able to predict or control.
  • Non-GAAP loss from operations is still expected, though improving, for Q3 2020.
  • Non-GAAP net loss per share is still expected for Q3 2020.

Company Overview

Full financial data and analysis

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