"Cloudflare shares fell roughly 24% on May 8, extending an after-hours slide following the report. For prudent investors, Fish's call reads as a textbook buy-the-dip endorsement on one of the priciest infrastructure software names. Fish wasn't surprised by the selloff, noting that Cloudflare stock had run up sharply into the earnings report. Cloudflare shares climbed roughly 19% over the past month through May 7, setting up a classic profit-taking unwind regardless of fundamentals."
"Fish described the report as "largely a perplexing quarter for Cloudflare that may remind some of three years ago," a nod to past execution stumbles that ultimately proved to be buying opportunities. He continues to recommend buying dips in Cloudflare as "one of the highest quality names in tech." The Piper Sandler view: a sharp drawdown after a more than 40% run in just a few weeks reflects positioning, not a thesis break. The price target raise to $250 signals continued confidence in Cloudflare's multi-year growth runway."
"Cloudflare operates a connectivity cloud platform spanning network security, edge performance, and developer compute, with the Workers runtime emerging as a key bet on agentic AI inference at the edge. The platform blocks billions of online threats daily across millions of customers. Cloudflare's Q1 FY2026 revenue of $639.75 million grew 34% year over year (YoY) topped consensus, while non-GAAP EPS of $0.25 beat the $0.23 estimate. Current remaining performance obligations rose 34% YoY, signaling durable bookings."
"CEO Matthew Prince announced an agentic AI-first operating model with a workforce reduction of roughly 1,100 employees and $140 million to $150 million in restructuring charges primarily landing in Q2. The company’s results included Q1 FY2026 revenue of $639.75 million, up 34% YoY, and non-GAAP EPS of $0.25, above the $0.23 estimate. Remaining performance obligations increased 34% YoY, supporting expectations for durable bookings."
Cloudflare shares fell about 24% after Q1 FY2026 earnings, extending an after-hours decline. The selloff was attributed to sharp prior gains of roughly 19% over the prior month, creating conditions for profit-taking. A raised price target to $250 from $222 was maintained alongside an Overweight rating. The quarter was characterized as perplexing but not a fundamental break, with prior execution issues viewed as potential buying opportunities. Cloudflare provides a connectivity cloud platform covering network security, edge performance, and developer compute, including Workers for edge AI inference. Q1 FY2026 revenue reached $639.75 million, up 34% year over year, and non-GAAP EPS of $0.25 beat estimates. Remaining performance obligations increased 34% year over year, and an agentic AI-first operating model was announced with workforce reductions and restructuring charges expected mainly in Q2.
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