Security, performance, and reliability company, Cloudflare announced financial results for its first quarter ended March 31, 2021. Strong large customer growth, with a record addition of roughly 120 large customers in the quarter and large customers now representing greater than 50% of revenue.
Financial highlights:
- Revenue: Total revenue of $138.1 million, representing an increase of 51% year-over-year.
- Gross Profit: GAAP gross profit was $106.0 million, or 76.8% gross margin, compared to $70.4 million, or 77.2%, in the first quarter of 2020. Non-GAAP gross profit was $107.2 million, or 77.6% gross margin, compared to $71.5 million, or 78.3%, in the first quarter of 2020.
- Operating Loss: GAAP loss from operations was $31.3 million, or 22.6% of total revenue, compared to $36.1 million, or 39.5% of total revenue, in the first quarter of 2020. Non-GAAP loss from operations was $7.5 million, or 5.4% of total revenue, compared to $14.4 million, or 15.8% of total revenue, in the first quarter of 2020.
- Net Loss: GAAP net loss was $40.0 million, compared to $32.7 million in the first quarter of 2020. Non-GAAP net loss was $9.3 million, compared to $12.3 million in the first quarter of 2020. GAAP net loss per share was $0.13, compared to $0.11 in the first quarter of 2020. Non-GAAP net loss per share was $0.03, compared to $0.04 in the first quarter of 2020.
- Cash Flow: Net cash flow from operations was $23.5 million, compared to negative $14.3 million for the first quarter of 2020. Free cash flow was negative $2.2 million, or 2% of total revenue, compared to negative $30.6 million, or 34% of total revenue, in the first quarter of 2020.
- Cash, cash equivalents, and available-for-sale securities were $1,035.2 million as of March 31, 2021.
Financial outlook:
For the second quarter of fiscal 2021, the company expects:
- Total revenue of $145.5 to $146.5 million
- Non-GAAP loss from operations of $10 to $9 million
- Non-GAAP net loss per share of $0.04 to $0.03, utilizing weighted average common shares outstanding of approximately 308 million
For the full-year fiscal 2021, the company expects:
- Total revenue of $612 to $616 million
- Non-GAAP loss from operations of $28 to $24 million
- Non-GAAP net loss per share of $0.11 to $0.10, utilizing weighted average common shares outstanding of approximately 310 million
Matthew Prince, co-founder & CEO, Cloudflare, said,
“We had a record-setting start to the year. Our Q1 revenue growth was up 51% year-over-year, and dollar net retention increased to 123%. We crossed 4 million total customers, and our large customer count was up 70% year-over-year, accounting for more than half of our total revenue. We delivered terrific financial results while also investing in innovation, the fuel our engine runs on. Firing on all cylinders, we’ve already announced or delivered more than 100 products and capabilities this year. There’s no slowing down as we continue to deliver business-critical offerings and displace point solutions with Cloudflare’s robust global network.”