Cloudflare has built a massive global network: 348 Tbps of capacity across a combination of transit connections, peering and private network interconnects with data centre locations in 125 countries and 335 cities. That network now serves nearly 20% of the world’s websites.
Cloudflare’s CEO Matthew Prince has described this backbone as facilitating an “innovation flywheel” off which the company has spun a range of interconnected products. Users [due disclosure, The Stack is among them] can use Cloudflare to register domain names; for content caching at the “edge”, for DDoS protection and the warding-off-of-AI-bots; even for cloud storage, AI inference, or as a “zero trust” security provider.
It’s a heady brew of offerings that Cloudflare described in its 2019 IPO prospectus as centered around “unified control plane to deliver security, performance, and reliability across on-premise, hybrid, cloud, and software-as-a-service (SaaS) applications” – and one that has earned it millions of free users and over 237,700 paying customers globally.
Enterprise ROI: Show me the scale
Yet as of the end of 2024 only 173 of those customers spend over $1 million a year with Cloudflare. (It added 31% of them during the year). Despite the scale of its network and capabilities, that puts it a very long away away from the large cloud providers with which, on many fronts, it competes across network, compute, storage, security and developer tools – and with whom many customers spend hundreds of millions annually.
That hasn't stopped Cloudflare from growing pretty substantially: Quarterly revenues were $459.9 million for its last reported quarter; up 27% year-over-year and it added a record number of customers that pay it over $100,000 per year (that's 3,497 such customers, also up 27%.)
See also: A $300 million cloud bill triggered a rethink at GEICO - and a shopping spree on modular hardware
The company is keen to start serving and showcasing ROI for larger enterprise partners however – but has arguably struggled to articulate the precise nature of how its proposition can help to deliver that for CIOs and CISOs; how its offerings can be joined up and what they can displace.
(That latter point matters: As Nomura’s Global CTO Dinesh Keswani put it to The Stack recently “One of the first things that I asked my team to do is ask, 'do we need it? What are you going to get rid of before you implement this?' Get rid of two things, and I can bring another thing in.”)
