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Cloudflare Posts Upbeat Q3 Results
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Cloudflare Posts Upbeat Q3 Results

Cloudflare (NET) reported better-than-expected results for the third quarter.

The company reported break-even earnings for Q3, exceeding the consensus estimate of a loss of $0.04 per share, surpassing a loss of $0.02 per share reported in the same quarter last year.

Total revenues generated in the quarter amounted to $172.3 million, against the consensus estimate of $165.7 million. Additionally, revenues increased 51% year-over-year primarily due to large customer growth of about 71% year-over-year.

Co-founder and CEO of Cloudflare, Matthew Prince, said, “Our strong growth and efficiency also propelled us to reach profitability this quarter, achieving that milestone a year ahead of our original timeline. We’re laser focused on investing profits back into our business, continuing to fuel our innovation machine, and supporting even more global organizations as they plug into our network platform.”

Outlook

The company raised its guidance for FY 2021, and projects total revenues between $647 million and $648 million, against the consensus estimate of $632 million. Its non-GAAP net loss guidance range of $0.06 per share to $0.05 per share stands ahead of the Street’s expectation of a loss of $0.12 per share.

The company expects to post Q4 revenue of $184 million to $185 million, with the anticipation of either breaking even or posting a net loss per share of $0.01.

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Analyst Recommendation

Wells Fargo analyst Andrew Nowinski maintained a Hold rating on the stock, and a price target of $210 (5.7% upside potential to current levels).

Based on six Buys and six Holds, the stock has a Moderate Buy consensus rating. The average Cloudflare price target is $191.82, which implies 3.4% downside potential from current levels.

Website Traffic

TipRanks’ Website Traffic Tool, which uses data from SEMrush Holdings (SEMR), the world’s biggest website usage monitoring service, offers insight into Cloudflare’s performance.

According to the tool, the number of total unique visitors for September 2021 on all devices comes in at 13.4 million, down 5.8% year-over-year. On a year-to-date basis, the number of total unique visitors to the company’s website, from January 2021 to September 2021, dropped 2.6% from the same period last year.

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