Why Did Cloudflare Stock Soar 10.61%?

On May 9, 2025, Cloudflare's stock surged by 10.61% in pre-market trading, reflecting strong investor confidence in the company's recent financial performance and strategic initiatives.

Cloudflare reported a 27% year-over-year increase in revenue for the first quarter of 2025, totaling $479.1 million. This growth was driven by a significant increase in enterprise demand and a record-breaking $100 million deal. The company's adjusted earnings per share (EPS) met analysts' expectations at $0.16, demonstrating stable profitability despite operational losses.

Cloudflare's financial results also highlighted a 77.1% gross profit margin, with free cash flow increasing by 49% year-over-year to $52.9 million. The company's operating cash flow saw a substantial 98% year-over-year increase to $145.8 million, underscoring its robust financial health. Additionally, Cloudflare's cash and short-term investments stood at $1.91 billion, providing a solid foundation for future growth and strategic investments.

Looking ahead, Cloudflare has set an ambitious revenue target of over $2 billion for the fiscal year 2025, driven by continued enterprise growth and strategic partnerships. The company's strong financial performance and optimistic outlook have bolstered investor confidence, contributing to the significant pre-market surge in its stock price.