Link to full press release: https://cloudflare.net/news/news-details/2021/Cloudflare-Ann…
Cloudflare Announces Third Quarter 2021 Financial Results
Third quarter total revenue totaled $172.3 million, representing an increase of 51% year-over-year
Strong large customer growth, with a record addition of roughly 170 large customers in the quarter, bringing the total number of large customers to 1,260
Delivered GAAP net loss of $107.3 million and non-GAAP net income of $1.4 million, with non-GAAP net income achieving milestone of break-even
SAN FRANCISCO–(BUSINESS WIRE)-- Cloudflare, Inc. (NYSE: NET), the security, performance, and reliability company helping to build a better Internet, today announced financial results for its third quarter ended September 30, 2021.
“We had a landmark third quarter, with revenue growth up 51% year-over-year, and large customer growth up 71% year-over-year. Our strong growth and efficiency also propelled us to reach profitability this quarter, achieving that milestone a year ahead of our original timeline,” said Matthew Prince, co-founder & CEO of Cloudflare. “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. We want to give them one less thing to worry about so they can focus on running their businesses.”
Third Quarter Fiscal 2021 Financial Highlights
Revenue: Total revenue of $172.3 million, representing an increase of 51% year-over-year.
Gross Profit: GAAP gross profit was $134.8 million, or 78.2% gross margin, compared to $87.2 million, or 76.3%, in the third quarter of 2020. Non-GAAP gross profit was $136.6 million, or 79.2% gross margin, compared to $88.2 million, or 77.3%, in the third quarter of 2020.
Operating Income (Loss): GAAP loss from operations was $26.5 million, or 15.4% of total revenue, compared to $21.3 million, or 18.6% of total revenue, in the third quarter of 2020. Non-GAAP income from operations was $2.2 million, or 1.3% of total revenue, compared to a loss from operations of $4.5 million, or 4.0% of total revenue, in the third quarter of 2020.
Net Income (Loss): GAAP net loss was $107.3 million, compared to $26.5 million in the third quarter of 2020. GAAP net loss per basic and diluted share was $0.34, compared to $0.09 in the third quarter of 2020. Non-GAAP net income was $1.4 million, compared to non-GAAP net loss of $5.8 million in the third quarter of 2020. Non-GAAP net income per diluted share was $0.00, compared to non-GAAP net loss per share of $0.02 in the third quarter of 2020.
Cash Flow: Net cash flow from operating activities was negative $6.9 million, compared to $2.0 million for the third quarter of 2020. Free cash flow was negative $39.7 million, or 23% of total revenue, compared to negative $17.9 million, or 16% of total revenue, in the third quarter of 2020.
Cash, cash equivalents, and available-for-sale securities were $1,813.9 million as of September 30, 2021.
The section titled “Non-GAAP Financial Information” below describes our usage of non-GAAP financial measures. Reconciliations between historical GAAP and non-GAAP information are contained at the end of this press release following the accompanying financial data.
The following forward-looking statements regarding our financial outlook are subject to substantial uncertainty as a result of the ongoing COVID-19 pandemic, reflect our estimates as of November 4, 2021 regarding the impact of the pandemic on our operations, and are highly dependent on numerous factors that we may not be able to predict or control, including, among others: the duration, spread, and severity of the pandemic; actions taken by governments and businesses in response to the pandemic and the resulting impact on our customers, vendors, and partners; the timing of administering COVID-19 vaccines around the world and the long-term efficiency of these vaccines; the impact of the pandemic on global and regional economies and economic activity generally; our ability to continue operating in impacted areas; and customer demand and spending patterns.
For the fourth quarter of fiscal 2021, we expect:
Total revenue of $184.0 to $185.0 million
Non-GAAP income (loss) from operations of $(1.0) to $0.0 million
Non-GAAP net income (loss) per share of $(0.01) to $0.00, utilizing weighted average common shares outstanding of approximately 320 million for a net loss per share, and approximately 345 million for a net income per share
For the full year fiscal 2021, we expect:
Total revenue of $647.0 to $648.0 million
Non-GAAP loss from operations of $10.5 to $9.5 million
Non-GAAP net loss per share of $0.06 to $0.05, utilizing weighted average common shares outstanding of approximately 312 million