Cloudflare’s shares rose 24% in extended trading after the company exceeded market expectations with its first-quarter revenue and profit forecast. The company was counting on robust demand for its cloud and content delivery services.
In recent months, there has been a sharp increase in demand for cybersecurity and cloud services as businesses actively try to digitize their operations for more efficient and automated workflows.
While LSEG forecasts $372.3 million for the first quarter, Cloudflare anticipates revenue of $372.5 million to $373.5 million.
Additionally, it predicted adjusted earnings of 13 cents per share as opposed to the 12 cents analysts had predicted.
The company’s topline growth is primarily driven by client retention and it provides a portfolio of website and application services offerings, including content delivery network services.
According to CEO Matthew Prince, Cloudflare had the greatest number of new customers acquired and renewed in the fourth quarter.
Revenue for the company in the fourth quarter increased by 32% to $362.5 million. Based on LSEG data, analysts projected $353.1 million on average.
Above analysts’ projections of 12 cents, its adjusted earnings per share was 15 cents.
An experienced squad of hackers attempted to penetrate deeply into Cloudflare’s global network late last year, but were thwarted, the company announced earlier this month. The corporation had stated at the time that the intrusion had “minimal” operational impact.