Cloudflare, Inc. Earnings Summary — Q1 2026

• Revenue reached a record $639.8M, maintaining a strong 33.5% YoY growth trajectory.
• GAAP net loss widened to $22.9M from $12.1M in the previous quarter, reflecting intensified R&D and S&M spending.
• Interest income remains a significant offset to operating losses, contributing $40.2M to the bottom line.
• Gross margins remain robust and consistent with high-quality SaaS benchmarks, despite massive scaling.
• The up-market strategy continues to yield results with consistent revenue growth even as the base expands.
• The company continues to operate with a pristine balance sheet featuring zero long-term debt.
• Stock-based compensation remains a key factor in the gap between operational cash flow and GAAP profitability.
• Research & Development expenses grew nearly 31% YoY to $151M as the company scales AI inference capabilities.

Management remains focused on the 'innovation flywheel,' prioritizing the expansion of the Workers serverless platform and AI inference over immediate GAAP net income.

Stable

While revenue growth remains impressively consistent at >30%, the widening of GAAP losses this quarter keeps the focus on the company's path to true profitability.

Cloudflare is positioned as a high-quality compounder in the edge computing space, with a strategy heavily weighted toward capturing market share in enterprise security and AI infrastructure.