Cloudflare has raised its full-year revenue and earnings forecast after reporting stronger-than-expected quarterly results, driven by increasing demand for its cloud and security services as businesses expand the use of AI agents. The announcement sent the company’s shares up 18% in after-hours trading.
The company now expects full-year revenue between $2.86 billion and $2.87 billion, up from its previous forecast of $2.805 billion to $2.813 billion, and above analysts’ estimate of $2.81 billion.
For the 2nd quarter ended June 30, Cloudflare reported revenue of $696.1 million, surpassing analysts’ expectations of $665.5 million. The company also posted adjusted earnings of $0.29 per share, exceeding the estimated $0.27 per share.
Looking ahead, Cloudflare expects 3rd-quarter revenue to be between $736 million and $737 million, ahead of market estimates of $722.1 million.
The company also increased its full-year adjusted earnings guidance to $1.25–$1.26 per share, compared with its earlier forecast of $1.19–$1.20 per share.
Cloudflare said the rapid adoption of AI agents is driving more businesses to use its network to securely route traffic and run AI-powered applications, boosting demand for its cloud infrastructure and cybersecurity offerings.
Earlier this year, in May, the company announced plans to reduce approximately 20% of its workforce, affecting more than 1,100 employees, as part of an AI-led restructuring initiative.
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