Company: NET
Filing Date: 2025-05-08
Form Type: 10-Q
Source: 0001477333-25-000082
Chunk: 355

Company: Cloudflare, Inc.
Filing Date: 2025-05-08
Form: 10-Q
Item: Part I, Item 1
Chunk 355
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 purchasing decisions by existing and potential new paying customers, additional lengthening of the sales cycle for some of our existing and potential new paying customers, potential customer requests for concessions (including in terms of payment amounts and/or timing and earlier or additional termination rights), potential losses of paying customers as a result of economic distress or bankruptcy (particularly among our small and medium paying customer base), potential reductions in new non-U.S. customers and expansion of sales to existing non-U.S. paying customers as a result of our products, which are substantially all sold in U.S. dollars, becoming relatively more expensive for such customers due to the higher value of the U.S. dollar relative to certain other currencies, and increased costs for employee compensation and equipment purchases resulting from continued inflationary cost pressures. 

For further discussion of the challenges and risks we confront related to macroeconomic conditions and geopolitical tension around the world, please refer to Part II, Item 1A “Risk Factors” of this Quarterly Report on Form 10-Q.

Financial Measures and Key Business Metrics

We review a number of financial and operating metrics, including the following non-GAAP financial measures and key metrics to evaluate our business, measure our performance, identify trends affecting our business, formulate business plans, and make strategic decisions.

Three Months EndedMarch 31,20252024(dollars in thousands)Gross profit$363,511 $293,564 Gross margin76 %78 %Loss from operations$(53,247)$(54,550)Non-GAAP income from operations$56,001 $42,443 Operating margin(11)%(14)%Non-GAAP operating margin12 %11 %Net cash provided by operating activities$145,784 $73,579Net cash provided by (used in) investing activities$(92,438)$96,950Net cash provided by financing activities$3,522 $21Free cash flow$52,867 $35,607Net cash provided by operating activities (as a percentage of revenue)30 %19 %Free cash flow margin11 %9 %Paying customers(1)250,819 197,138 Paying customers (> $100,000 Annualized Revenue)(1)3,527 2,878 

(1)Key business metrics are derived on a quarterly basis. Refer to Key Business Metrics section below for further detail. 

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The following table summarizes the revenue by region based on the billing address of customers who use the Company’s products: