I had three companies I could write up earnings on today, but one stood out. When I last looked at Cloudflare in June (GTM revamp, financials, and product moves), there were a lot of mgmt promises on their GTM improvements leading to a reacceleration in the 2H of 2025. Cloudflare announced Q425 results this week, and this aircraft carrier (an investor pal's shorthand for Cloudflare's resilience) keeps on sailing forward.
- We can now say "Mission Accomplished" on the GTM revamp after 3 quarters of revenue reacceleration, improving sales metrics, growing PoF mix, and continued large deals.
- Revenue accelerated for the 3rd Q, to now +33.6%.
- RPO growth has accelerated +12pp over the past year to +48%. cRPO growth remains above revenue growth.
- Mgmt guided FY26 to +28.9%, a strong signal and improvement over the initial FY25 guide of +25.4% (actual +29.9%).
- Customer growth has remained stellar over the past year, adding record net new customers over the last 2Qs (+29.6K then +36.9K).
- Large customer growth has also been strong, adding record net new large customers over the last 2Qs (+297 and +289).
- These large customers continue to grow faster than overall (+41.4% vs +33.6%).
- NRR has rebounded to 120% now that PoF headwinds have eased.
- FCF margin came in at a record 16%, boosting them back into Rule of 40 TTM.
- Cloudflare is not only taking advantage of a surge in web traffic from AI today, but is also well-positioned for the rise of agentic AI from here.
- BONUS: I also take a brief look at Fastly's latest results.