In a significant showing for the first quarter, Cloudflare has exceeded revenue expectations while meeting the forecast for adjusted earnings per share. The company’s impressive results were propelled by securing the largest customer contract in its history. This milestone deal, valued at over $100 million, centers around Cloudflare’s Workers developer platform, signaling a major vote of confidence in the company’s technological capabilities.
The company’s performance was further underscored by notable growth in its large customer base. During the first quarter, the number of customers spending at least $100,000 annually increased by 23% compared to the same period last year. These large customers now account for 69% of Cloudflare’s total revenue, up from 67% in the previous year. Additionally, the dollar-based net retention rate remained steady at 111%, consistent with the fourth quarter of 2024.
Financially, Cloudflare demonstrated robust growth. Overall revenue surged by 27% to reach $479.1 million. Adjusted earnings per share held steady at $0.16. While the adjusted gross margin dipped slightly to 77%, it still remains within the company’s long-term model range. Free cash flow saw a remarkable 49% jump, reaching $52.9 million. Looking ahead, Cloudflare anticipates generating revenue between $2.09 billion and $2.094 billion in fiscal 2025, reflecting a 25% growth from fiscal 2024. The company also projects a non-GAAP operating margin of 13% for the year, indicating a positive outlook for its future financial performance.
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