Cloudflare’s Apple deal brings AI opportunity into focus, says Morgan Stanley

At Apple’s (AAPL) WWDC last week, the company announced their Private Cloud Compute alongside Apple Intelligence, and Cloudflare (NET) potentially plays a big role in PCC by encrypting AI queries, Morgan Stanley analyst Hamza Fodderwala tells investors in a research note. The firm estimates a low- to mid single digit percentage tailwind to Cloudflare’s topline growth from FY25-FY27 as AI penetration within Apple’s base grows. The firm made no change to its Equal Weight rating or $92 price target on Cloudflare shares.