Cloudflare (NET) investor relations material

Executive summary

• Achieved Q1 2026 revenue of $640M, up 34% year-over-year, with 73% non-GAAP gross margin.

• Large customers (> $100K annualized revenue) reached 4,400+, contributing 72% of revenue.

• Transitioning to an agentic AI-first operating model, including a workforce reduction of approximately 1,100 employees and estimated restructuring charges of $140–$150 million.

• Operates a global network in 335+ cities, serving 95% of the world's internet-connected population within 50ms.

• Blocks ~234 billion cyber threats daily, with 51% of revenue from outside the U.S.

Financial highlights

• Q1 2026 revenue: $640M, 34% year-over-year growth.

• Q1 2026 non-GAAP gross margin: 73%.

• GAAP gross profit was $455.6M (71.2% margin); non-GAAP gross profit was $465.7M (72.8% margin).

• Dollar-based net retention rate at 118% in Q1 2026.

• Net cash flow from operating activities was $158.3M, with free cash flow of $84.1M (13% of revenue).

Outlook and guidance

• Q2 2026 revenue guidance: $664M–$665M, 30% year-over-year growth.

• FY 2026 revenue guidance: $2.805B–$2.813B, 29–30% growth.

• FY 2026 operating income guidance: $418M–$421M, 15% margin.

• FY 2026 EPS guidance: $1.19–$1.20.

• FY 2026 network capex as % of revenue: 14–15%.