Cloudflare (NYSE:NET) reported better-than-expected Q2 earnings, sending its shares about 9% higher in pre-open Friday.
The company reported Q2 EPS of $0.10 on revenue of $308.5 million, topping the consensus for earnings of $0.07 on revenue of $305.6M. Sales rose 32% year-over-year while adjusted gross margin came in at 77.7%, in line with Street expectations.
Cloudflare also reported a record quarter for new ACV bookings.
“Our innovation engine remains in high gear, and by our estimates, Cloudflare is the most commonly used cloud provider across leading AI startups. In the second quarter alone, we shared ten major announcements and features to extend Cloudflare Workers as the preeminent development platform built for the age of AI. We believe we’re uniquely positioned to become a leader in AI inferencing and have a lot more in store across the entire AI lifecycle to help enable companies to build the future,” said Matthew Prince, co-founder & CEO of Cloudflare.
BTIG analysts said the company’s results were “solid.”
“The company appears to be gaining more momentum with its Zero Trust platform in larger enterprise accounts. We made only minor changes to our growth forecasts in 2023 and 2024 and maintain our Neutral rating.”
TD Cowen analysts hiked the price target by $10 to $80 per share.
“NET continues to deliver solid performance, and we reiterate our Outperform rating,” they said.