Cloudflare (NET) Q4 2025 earnings summary

Executive summary

• Achieved Q4 revenue of $615M, up 34% year-over-year, with strong acceleration in new annual contract value and large customer growth; full-year revenue reached $2.17B.

• Ended 2025 with 332,466 paying customers, up 40% year-over-year, and 4,298 large customers (> $100K annualized revenue), representing 73% of total revenue.

• Record new ACV booked, including the largest annual contract value deal in company history ($42.5M/year), with global sales productivity and quota attainment at all-time highs.

• Notable customer wins include leading AI companies, Fortune 100/500 tech firms, government, and media, highlighting the company's role as a critical infrastructure provider.

• Maintained a high non-GAAP gross margin of 75% in Q4 2025, supported by a scalable serverless architecture and efficient cost structure.

Financial highlights

• Q4 non-GAAP gross margin was 74.9%, with GAAP gross profit at $452.6M (73.6% margin); operating income reached $89.6M (14.6% margin), and net income was $106.8M ($0.28/share).

• Free cash flow was $99.4M (16% of revenue) in Q4; full-year free cash flow was $260.6M (12% of revenue).

• Ended Q4 with $4.1B in cash, cash equivalents, and available-for-sale securities; RPO grew 48% year-over-year to $2.5B.

• Full-year 2025 revenue reached $2.17B, a 29% CAGR since 2023.

• Operating cash flow for Q4 2025 was $190M, with a 30% margin.

Outlook and guidance

• Q1 2026 revenue expected at $620–$621M, with non-GAAP income from operations of $70–$71M and EPS of $0.23.

• Full-year 2026 revenue guidance is $2.785–$2.795B (28–29% growth), operating income of $378–$382M, and EPS of $1.11–$1.12.

• Network CapEx as a percentage of revenue projected at 12–15% for FY 2026.

• Revenue expected to be weighted 46% in the first half of 2026.