Cloudflare (NYSE:NET) stock has significantly outperformed the market, surging 71% year-to-date, fueled by a robust 73% gain in its most recent quarter. In contrast, the NYSE Composite Index, which includes Cloudflare, rose only 8% and 13% during the same respective periods.
Cloudflare is a cybersecurity company that delivers internet infrastructure services that improve website and app speed, security, and reliability.
The company operates as a Content Delivery Network (CDN) by using its global server network to cache and deliver website content near end users, boosting site speed and performance.
Also Read: Buy Cloudflare Or Sell? Analysts Vary Over Sales Acceleration And Business Momentum
The global CDN market is expected to grow from $27.59 billion in 2024 to over $144.91 billion by 2034, expanding at a compound annual growth rate (CAGR) of 18.04% between 2025 and 2034.
Companies like Cloudflare have the potential to gain from the rapidly expanding CDN space as consumers increasingly turn to streaming video and audio content. However, its competitors include Big Tech giants like Amazon.com (NASDAQ:AMZN) Amazon Web Services.
Recent Quarter Results
On May 8, Cloudflare reported first-quarter revenue of $479.09 million, up 27% on a year-over-year basis, topping analyst consensus estimates of $469.28 million backed by over $100 million deal driven by its Workers developer platform, and the longest-term SASE contract to date.
Cloudflare expects second-quarter revenue of $500 million-$501 million versus estimates of $500.34 million. Cloudflare also affirmed its full-year 2025 guidance, including revenue of $2.09 billion-$2.094 billion versus estimates of $2.09 billion.
Analyst Take On Cloudflare
Thirty-three analysts set a consensus price target of $141.56 for Cloudflare. Morgan Stanley issued the highest target at $225 on July 11, 2025. Based on the latest ratings from Morgan Stanley, KeyBanc, and Oppenheimer, who collectively averaged a $211.67 target, Cloudflare shares have an implied 15.09% upside.
Needham analyst Mike Cikos expressed optimism over the stock after its quarterly results, citing its record-breaking $130 million, five-year Pool-of-Funds agreement, beating out AWS. The analyst highlighted Cloudflare’s business model shift from network investment and a freemium approach to deeper service functionality and targeting large enterprise adoption. The analyst said its technology is well-suited to address critical problems and support emerging trends like Cloud Direct, Zero Trust, digital transformation, multi-cloud, and Edge Compute.
On March 26, Goldman Sachs analyst Gabriela Borges maintained a Buy rating on Cloudflare with a $161 price forecast, citing strong AI inference potential. Borges expects Cloudflare’s Act III products to grow from $80 million ARR in 2024 to $1.3 billion by 2030, supported by rising capex and GPU investment. She believes Cloudflare’s early-stage product cycle and tech advantages will help it capture a significant share of the AI-driven profit pool.
On March 25, Bank of America Securities analyst Madeline Brooks upgraded Cloudflare to Buy and raised the price forecast to $160 from $60, citing strong AI-as-a-Service and security growth.
Brooks believes Cloudflare could emerge as a leading AI-as-a-Service provider, as enterprises increasingly favor this model for adopting AI tools. She notes that Cloudflare is gaining momentum in network security, especially in SASE, as businesses shift toward software-based security solutions.
She expects this strength in AI and security to fuel a 30% compound annual growth rate over the next three years, up from her 25% estimate. Brooks adds that enterprises choose Cloudflare over major hyperscalers like AWS, Oracle (NYSE:ORCL), and Microsoft (NASDAQ:MSFT) Azure due to its ease of use, scalability, and better resource efficiency.
Brooks sees Cloudflare meeting full-year revenue guidance but warns it must execute flawlessly to hit its ambitious $5 billion revenue target by 2028.
On June 11, Cathie Wood’s Ark Invest made significant trades, with Cloudflare being a prominent stock. Ark Invest sold 5,193 Cloudflare shares.
Recent Expansion Initiatives By Cloudflare
On June 13, Cloudflare raised $1.75 billion by pricing convertible notes due in 2030, generating $1.72 billion in net proceeds and including an option to increase the offering by $250 million.
The company set a 45% conversion premium and plans to use the proceeds for capped call transactions and general corporate purposes.
Price Action: NET stock is trading higher by 1.47% to $184.60 at last check Friday.
Read Next:
Photo via Shutterstock
