Cloudflare is a web infrastructure and security company
Product
- Cloudflare One
- Cloudflare Network service
- WAN as a service
- Firewall as a service
- DDoS as a service
- Cloudflare Applications Services
- WAF
- Load balancing
- Bot management
- CDN and DNS
- Cloudflare Network service
- Cloudflare Edge Developer Platform
- Workers
- Pages
- Video Streaming
- Cloudflare Global Network
- Global Edge (250+ cities, 95% of pop within 50ms)
Business Model
- Revenue: 431M (+50% YoY)
- Have contracts with ISP to put products onprem
- 50% of Revenue from Large customers
- Product Breakdown
- Confluent Platform: 57%
- Confluent Cloud: 22%
- Services: 11%
- Geographic Breakdown
- US Revenue: 53%
- EMEA: 26%
- APAC: 14%
- Other: 7%
- Type
- Direct: 90%
- Channel: 11%
- Cost of Revenue
- Cost of subscription revenue:
- personel costs for customer support & maintenance
- 3rd party cloud infrastructure costs
- Cost of subscription revenue:
Core Metrics
- Revenue F22: 648M (+48 YoY)
- Total Revenue Q3: 172M (+50% YoY)
- Cost of Revenue: 37M (+37% YoY)
- Gross profit: 134M (+54% YoY)
- Gross margin: 79% YoY
- Customers: 132k
- Customers >100k ARR: 1260 (+70% YoY)
- Customers > 1M ARR:
- Net dollar retention: 124%
Analysis
Personally, I use Cloudflare for my individual sites (including this one) and I find their platform to be very easy to use and develop friendly. However, at their current revenue multiples ~100x, I believe they are extremely overvalued. I believe in 3 years, they can hit $1.5-2B in revenue but even with a 25x revenue multiple, that would place them at $37-50B.