Company: NET
Filing Date: 2025-02-20
Form Type: 10-K
Source: 0001477333-25-000043
Chunk: 151

Company: Cloudflare, Inc.
Filing Date: 2025-02-20
Form: 10-K
Item: Item 7
Chunk 151
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24 %

Sales and marketing expenses increased by $146.7 million, or 24%, for the year ended December 31, 2024 compared to the year ended December 31, 2023. The increase was primarily driven by $90.9 million in increased employee-related costs due to an 11% increase in headcount in our sales and marketing organization, including an increase of $19.2 million in stock-based compensation expense, and a $15.0 million one-time compensation charge. The remainder of the increase was primarily due to an increase of $24.5 million in expenses for marketing programs due to acquisitions, investments in brand awareness advertising, third-party industry events, and digital performance marketing, an increase of $9.7 million in co-location and bandwidth expenses for free customers, an increase of $7.2 million in travel-related expenses, an increase of $5.8 million in consulting expenses, and an increase of $4.1 million in subscription expenses.

Research and DevelopmentYear Ended December 31,Change20242023$%(dollars in thousands)Research and development$421,374 $358,143 $63,231 18 %

Research and development expenses increased by $63.2 million, or 18%, for the year ended December 31, 2024 compared to the year ended December 31, 2023. The increase was primarily driven by $64.3 million in increased employee-related costs due to a 25% increase in headcount in our research and development organization, including an increase of $15.4 million in stock-based compensation expense, and an increase of $4.5 million in subscription expenses, partially offset by increased capitalized internal-use software development costs of $11.1 million.

General and AdministrativeYear Ended December 31,Change20242023$%(dollars in thousands)General and administrative$278,520 $217,965 $60,555 28 %

General and administrative expenses increased by $60.6 million, or 28%, for the year ended December 31, 2024 compared to the year ended December 31, 2023. The increase was primarily driven by $48.9 million in increased employee-related costs due to a 21% increase in headcount in our general and administrative organization, including an increase of $33.1 million in stock-based compensation expense. The remainder of the increase was primarily due to an increase of $6.1 million in professional fees for third-party