Second quarter revenue totaled $99.7 million, representing an increase of 48% year-over-year
Q2 GAAP operating margin of (24.8)%, representing an increase of 450 basis points year-over-year; non-GAAP operating margin of (9.5)%, representing an increase of 1,820 basis points year-over-year
Q2 GAAP net loss per share of $(0.09), representing an improvement of $0.14 year-over-year; non-GAAP net loss per share of $(0.03), representing an improvement of $0.19 year-over-year
Cloudflare, Inc. (NYSE: NET), the security, performance, and reliability company helping to build a better Internet, today announced financial results for its second quarter ended June 30, 2020.
“We delivered a strong second quarter, with revenue growth up 48% year-over-year, and added a record number of both large and paying customers,” said Matthew Prince, co-founder and CEO, Cloudflare. “It has been incredible to see the rate of innovation that has continued, and even accelerated, as we work remotely. We hired more new team members than any other quarter in our history, attracting more than 47,000 applicants in just three months. As others pull back, we’re investing in our future, and the services our customers depend on for a fast, reliable, and secure Internet during these challenging times.”
Cloudflare: Lava Lamps/Wall of Entropy
Second Quarter Fiscal 2020 Financial Highlights
Revenue: Total revenue of $99.7 million, representing an increase of 48% year-over-year.
Gross Profit: GAAP gross profit was $75.6 million, or 75.8% gross margin, compared to $52.6 million, or 78.0%, in the second quarter of 2019. Non-GAAP gross profit was $76.6 million, or 76.8% gross margin, compared to $52.7 million, or 78.1%, in the second quarter of 2019.
Operating Loss: GAAP loss from operations was $24.7 million, or 24.8% of total revenue, compared to $19.8 million, or 29.3% of total revenue, in the second quarter of 2019. Non-GAAP loss from operations was $9.5 million, or 9.5% of total revenue, compared to $18.7 million, or 27.7% of total revenue, in the second quarter of 2019.
Net Loss: GAAP net loss was $26.1 million, compared to $19.7 million in the second quarter of 2019. Non-GAAP net loss was $9.6 million, compared to $18.6 million in the second quarter of 2019. GAAP net loss per share was $(0.09), compared to $(0.23) in the second quarter of 2019. Non-GAAP net loss per share was $(0.03), compared to $(0.22) in the second quarter of 2019.
Cash Flow: Net cash flow from operations was $4.0 million, compared to negative $2.9 million for the second quarter of 2019. Free cash flow was negative $20.2 million, or 20% of total revenue, compared to negative $16.9 million, or 25% of total revenue, in the second quarter of 2019.
Cash, cash equivalents, and available-for-sale securities were $1,069.1 million as of June 30, 2020.
The section titled “Non-GAAP Financial Information” below describes our usage of non-GAAP financial measures. Reconciliations between historical GAAP and non-GAAP information are contained at the end of this press release following the accompanying financial data.
Financial Outlook
The following forward-looking statements regarding our financial outlook are subject to substantial uncertainty as a result of the COVID-19 pandemic, reflect our estimates as of August 6, 2020 regarding the impact of the pandemic on our operations, and are highly dependent on numerous factors that we may not be able to predict or control, including, among others: the duration and spread of the pandemic; actions taken by governments and businesses in response to the pandemic and the resulting impact on our customers, vendors, and partners; the impact of the pandemic on global and regional economies and economic activity generally; our ability to continue operating in impacted areas; and customer demand and spending patterns.
For the third quarter of fiscal 2020, we expect:
Total revenue of $102.5 to $103.5 million
Non-GAAP loss from operations of $16 to $15 million
Non-GAAP net loss per share of $0.06 to $0.05, utilizing weighted average common shares outstanding of approximately 302 million
For the full year fiscal 2020, we expect:
Total revenue of $404 to $408 million
Non-GAAP loss from operations of $55 to $53 million
Non-GAAP net loss per share of $0.18 to $0.17, utilizing weighted average common shares outstanding of approximately 301 million
Source: Cloudflare, Inc. (NYSE: NET)
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