Internet security and content delivery network Cloudflare (NYSE:NET) will be reporting results tomorrow after market close. Here's what you need to know.
Last quarter Cloudflare reported revenues of $234.5 million, up 53.8% year on year, beating analyst revenue expectations by 3.08%. It was a solid quarter for the company, with exceptional revenue growth and a decent beat of analyst estimates.
Is Cloudflare buy or sell heading into the earnings? Read our full analysis here, it's free.
This quarter analysts are expecting Cloudflare's revenue to grow 44.9% year on year to $249.8 million, slowing down from the 50.9% year-over-year increase in revenue the company had recorded in the same quarter last year. Adjusted earnings are expected to come in at $0 per share.
Majority of analysts covering the company have reconfirmed their estimates over the last thirty days, suggesting they are expecting the business to stay the course heading into the earnings. The company has a history of exceeding Wall St's expectations, beating revenue estimates every single time over the past two years on average by 5.22%.
Looking at Cloudflare's peers in the software development segment, some of them have already reported Q3 earnings results, giving us a hint of what we can expect. F5 Networks delivered top-line growth of 2.64% year on year, beating analyst estimates by 1.17% and Bandwidth reported revenues up 13.5% year on year, exceeding estimates by 5.32%. F5 Networks traded down 1.13% on the results, and Bandwidth was up 5.51%. Read our full analysis of F5 Networks's results here and Bandwidth's results here.
There has been positive sentiment among investors in the software segment, with the stocks up on average 2.98% over the last month. Cloudflare is up 1.5% during the same time, and is heading into the earnings with analyst price target of $82.70, compared to share price of $55.82.
One way to find opportunities in the market is to watch for generational shifts in the economy. Almost every company is slowly finding itself becoming a technology company and facing cybersecurity risks and as a result, the demand for cloud-native cybersecurity is skyrocketing. This company is leading a massive technological shift in the industry and with revenue growth of 70% year on year and best-in-class SaaS metrics it should definitely be on your radar.
The author has no position in any of the stocks mentioned.