Company: NET
Filing Date: 2025-10-30
Form Type: 10-Q
Source: 0001477333-25-000141
Chunk: 341

Company: Cloudflare, Inc.
Filing Date: 2025-10-30
Form: 10-Q
Item: Part I, Item 1
Chunk 341
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.The Company classifies financial instruments in Level III of the fair value hierarchy when there is reliance on at least one significant unobservable input to the valuation model. In addition to these unobservable inputs, the valuation models for Level III financial instruments typically also rely on a number of inputs that are readily observable, either directly or indirectly. The Company’s assessment of the significance of a particular input to the fair value measurement in its entirety requires management to make judgments and consider factors specific to the asset or 

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liability. There were no financial instruments classified as Level III of the fair value hierarchy as of September 30, 2025 and December 31, 2024.

Note 5. Balance Sheet Components

Accounts Receivable, NetAs of September 30, 2025 and December 31, 2024, the Company’s allowance for doubtful accounts was $8.0 million and $8.2 million, respectively. Provision for bad debt for the three months ended September 30, 2025 and 2024 was $5.0 million and $2.6 million, respectively, and for the nine months ended September 30, 2025 and 2024 was $12.8 million and $6.7 million, respectively. Write-offs of uncollectible accounts receivable for the three months ended September 30, 2025 and 2024 was $4.3 million and $2.6 million, respectively, and for the nine months ended September 30, 2025 and 2024 was $13.0 million and $5.0 million, respectively.Property and Equipment, NetProperty and equipment, net consisted of the following:September 30, 2025December 31, 2024(in thousands)Property and equipment:Servers—network infrastructure$672,942 $488,799 Construction in progress69,857 68,973 Capitalized internal-use software126,877 98,055 Office and computer equipment39,871 30,872 Office furniture7,316 7,068 Software7,439 4,097 Leasehold improvements50,500 49,047 Asset retirement obligation827 827 Gross property and equipment975,629 747,738 Less accumulated depreciation and amortization(387,268)(280,318)Total property and equipment, net$588,361 $467,420 Depreciation and amortization expense on property and equipment for the three months ended September