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Class A shares of Cloudflare (NYSE:NET) on Thursday slumped as much as 13.4% in extended trading, after the content delivery network and cloud security platform issued Q4 revenue guidance that came in short of consensus.
NET stock was last down 5.2% to $53.62 after hours.
NET reported Q3 adjusted earnings per share of $0.16, which beat estimates by 6 cents. Revenue rose 32.2% Y/Y to $335.6M, also beating expectations by $5.02M.
San Francisco, Calif.-based Cloudflare (NET) provides products such as cloud-based security frameworks, developer platforms to build and deploy serverless applications, and networking security services. According to its website, Cloudflare (NET) powers Internet requests for millions of websites.
NET top boss Matthew Prince in a statement also touted the company’s new product Workers AI which is currently under open beta testing. As per NET, the product allows one to run machine learning models, on the Cloudflare (NET) network, using their own code.
“We believe inference is the biggest opportunity in AI, and inference tasks will largely be run on end devices and on connectivity clouds like Cloudflare (NET),” Prince said.
“By the end of 2024, we expect to have inference-optimized GPUs running in nearly every location where Cloudflare (NET) operates worldwide—within milliseconds of every Internet user,” the CEO added.
However, Cloudflare’s (NET) guidance came in slightly weak. For Q4, the firm expects total revenue of $352M to $353M, below the consensus estimate of $356.31M. Adjusted earnings per share is expected to be 12 cents, versus a consensus of 10 cents.
NET also narrowed its full year revenue guidance to $1.286B to $1.287B from a previous range of $1.283B to $1.287B. The consensus estimate is $1.28B. Full year adjusted earnings per share is now expected to be $0.45 to $0.46, compared to a consensus estimate of $0.37.