Cloudflare Shares Drop Amid Forecast of Lower Q4 Revenue and Economic Uncertainty

Cloudflare's Anticipated Q4 Revenue Falls Below Analyst Estimates as IT Budgets Tighten Amid Geopolitical Uncertainty

Cloudflare expects Q4 2023 revenue to range between $352 million and $353 million, falling short of the market estimate of $356.3 million, primarily due to clients seeking less expensive solutions amid global economic uncertainty.
Shares of Cloudflare fell more than 4% in aftermarket trading in response to the lower-than-expected revenue forecast.
Despite the lower Q4 forecast, Cloudflare reported a 32% increase in revenue for Q3 2023, with a total of $335.6 million exceeding analysts' estimates of $330.5 million.
The company's loss per share for Q3 2023 narrowed to 7 cents from 13 cents in the same period the previous year, which indicates an improvement in the company's profitability.
In addition to its financial outlook, Cloudflare announced that it has significantly accelerated its AI efforts, culminating in the launch of the Workers AI platform, partnerships with industry leaders, and plans to deploy inference-optimized GPUs worldwide by the end of 2024.