NEW YORK - Cloudflare, Inc. (NYSE:NET) saw its stock jump 8.6% in after-hours trading as the company reported better-than-expected second quarter earnings and provided upbeat guidance for the full year.
The leading connectivity cloud company posted adjusted earnings per share of $0.20 for the quarter ended June 30, 2024, surpassing analyst estimates of $0.14. Revenue came in at $401 million, beating the consensus forecast of $394.11 million and representing a 30% increase YoY.
Cloudflare's CEO Matthew Prince highlighted the company's strong performance, stating, "We had a strong second quarter, crossing $1.6 billion in annualized revenue and growing 30% year-over-year. The world is still complicated, but our team remained focused on execution and delivered terrific results, including a double-digit year-over-year improvement in sales productivity."
For the third quarter, Cloudflare expects revenue between $423 million and $424 million, slightly below analyst expectations of $427 million. However, the company's full-year outlook was more optimistic, projecting revenue of $1.657 billion to $1.659 billion, above the consensus estimate of $1.65 billion.
The company's non-GAAP gross profit margin improved to 79.0% in the second quarter, up from 77.7% in the same period last year. Free cash flow also saw a significant increase, reaching $38.3 million or 10% of revenue, compared to $20.0 million or 6% of revenue in the second quarter of 2023.
Cloudflare ended the quarter with a strong balance sheet, reporting $1,757.4 million in cash, cash equivalents, and available-for-sale securities as of June 30, 2024.
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