Company: NET
Filing Date: 2025-10-30
Form Type: 10-Q
Source: 0001477333-25-000141
Chunk: 436

Company: Cloudflare, Inc.
Filing Date: 2025-10-30
Form: 10-Q
Item: Part I, Item 8
Chunk 436
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), net— (1)(1)— Total non-operating income, net7 4 5 5 Income (loss) before income taxes— (3)(5)(5)Provision for income taxes— 1 1 — Net loss— %(4)%(6)%(5)%

Comparison of Three and Nine Months Ended September 30, 2025 and 2024

Revenue

Three Months EndedSeptember 30,ChangeNine Months EndedSeptember 30,Change20252024$%20252024$%(dollars in thousands)(dollars in thousands)Revenue$562,027 $430,082 $131,945 31 %$1,553,430 $1,209,680 $343,750 28 %

Revenue increased by $131.9 million and $343.8 million, or 31% and 28%, for the three and nine months ended September 30, 2025, compared to the three and nine months ended September 30, 2024. The increase in revenue was primarily due to the addition of new paying customers, as our number of paying customers increased by 33% as of September 30, 2025 compared to the prior period ended September 30, 2024, as well as the expansion within our existing paying customers, which was reflected by our dollar-based net retention rate of 119% for the three months ended September 30, 2025.

Cost of Revenue and Gross Margin

Three Months EndedSeptember 30,ChangeNine Months EndedSeptember 30,Change20252024$%20252024$%(dollars in thousands)(dollars in thousands)Cost of revenue$146,316 $95,967 $50,349 52 %$390,569 $270,016 $120,553 45 %Gross margin74 %78 %75 %78 %

Cost of revenue increased by $50.3 million, or 52%, for the three months ended September 30, 2025 compared to the three months ended September 30, 2024. The increase in the cost of revenue was primarily due to an increase 

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of $16.7 million of third-party technology services costs, an increase of $16.0 million in expenses related to operating in co-location facilities and network and bandwidth costs for operating our global network for our expanded customer base, as well as increased capacity