[HN Gopher] Cloudflare Announces Fourth Quarter and Fiscal Year ... ___________________________________________________________________ Cloudflare Announces Fourth Quarter and Fiscal Year 2020 Financial Results Author : ve55 Score : 97 points Date : 2021-02-11 21:22 UTC (1 hours ago) (HTM) web link (cloudflare.net) (TXT) w3m dump (cloudflare.net) | gigatexal wrote: | Not bad financials. Healthy margins, relatively small (in my | mind) losses and revenue growing well. At this rate they should | be profitable in a year? 2 maybe? | weeboid wrote: | For growth stocks, doesn't this signal stagnation? | dreaminvm wrote: | Solid results with exceptional margins and a healthy FY21 | outlook. I wonder if markets just have unrealistic expectations | (from the craziness of GME/AMC and cannbis stocks) or people are | just taking profits on a ~400% run up since IPO. | subsaharancoder wrote: | the latter, people booking unrealized gains pre-earnings, then | post earnings it finds a comfortable price point, then more | people buy and we rinse and repeat.. | cma wrote: | Cloudflare is still up 10% for the month. | de6u99er wrote: | My issue with Cloudflare is, that they don't do any content | checks. | | I remember a friend of a friend who knows someone who | participated in various Anonymous missions, that CloudFlare is | protecting islamic terrorist forums, and recently I learned fom | another friend of a friend that they are also protecting QAnon's | and Trump's online forum where rrcent insurrection was allegedly | planned and coordinated. | | There's tons if alternatives for those who don't want to do | business with such a company. | | E.g.: | https://www.g2.com/products/cloudflare/competitors/alternati... | lolinder wrote: | That sounds to me like a good thing. I don't want to trust a | company with my critical infrastructure if they have a habit of | moderating their customers' content. | Archio wrote: | Genuine question. If you found out that your water utility was | servicing an Islamist group's house, would you cancel your | service because you don't want to do business with them? | nickysielicki wrote: | Down 6% after hours, for reasons that I don't understand. | | Personally, I'm more-sure that Cloudflare will be around in 25 | years than I am that Facebook will be around in 25 years. Their | customers are real-valuable customers paying for a real-valuable | service, and that's not going away anytime soon. Meanwhile, their | serverless stuff is very cool and unique. I think their durable | objects are going to go mainstream someday. They work on | hard/interesting/real technology, that's _gotta_ be worth | something. | | I predict that one day, we'll see a C somewhere in "FAANGM". | Uehreka wrote: | I don't get why people still say FAANG, even. Netflix is doing | great and has some great tech, but these days it seems like | they're way more of a TV megastudio with a really great | engineering dept than a tech giant like Apple, Amazon, Facebook | and Google. | | Sure, they're no slouches, but it feels like any acronym that | includes Netflix needs to also include Microsoft for sure. In | fact, by the time you get to Netflix I feel like you'd have to | have included Salesforce, Tesla, maybe even Twitter, and | probably half a dozen names that aren't coming to me right now. | catmanjan wrote: | Most times I see faang it's in the context of tech jobs, and | Netflix is notorious for its wages - just my perspective as | an outsider in Australia... | nostrademons wrote: | Much of that's historical reputation, though. Netflix | actually underpays compares to some of its peers in the | valley now. As of early 2020 my perception (somewhat based | on levels.fyi data, as well as personal & friends' salary | data) is that the ordering is roughly FaceBook > Snap > | AirBnB > Google > Lyft > Stripe > Uber > Netflix > | Microsoft > Apple > Amazon > (old-line tech like IBM, | Oracle, HP, Juniper, Cisco). This was pre-COVID and tends | to move around a lot with stock prices though. | nostrademons wrote: | I'm fond of "MAGA" for "Microsoft, Apple, Google, Amazon". | That's the 4 largest tech companies on the market, and | they're the ones really making America great again. | daveevad wrote: | that is quite the synchronicity. | | that rebrand may be daunting but i support it. | [deleted] | tayo42 wrote: | I haven't really thought about it much, Netflix engineering | hype seems to have died down? Or maybe I'm just oblivious. | They seem more regular than they used to be? All their open | source was hyped up, I even got stuck using some of it | because of people following fads. | | And yeah agree Twitter always seems to be missing from | engineering hype. I guess their open source and engineering | out in the open is a shell of what is was. | | Tesla pays low, software isn't the main focus. Salesforce is | a b2b company, that i don't think most people actually like? | Do they pay like other companies or have unusual or | interesting software engineering problems? | m12k wrote: | > Down 6% after hours, for reasons that I don't understand. | | A stock doesn't go up or down based on whether it does well or | poorly, it does so based on how it performs relative to the | expectations that were already priced into it. If it does well, | but not as well as the market was expecting, then it will still | go down. | NationalPark wrote: | It's also after hours, which means volume is lower, and also | means nobody has traded options since the report. | xwdv wrote: | Three. Day. Rule. | prewett wrote: | Cloudflare seems like a promising stock, but the dual-class | shares really put me off. It doesn't even look like Class B is | even traded; at least for, say, Google, you can buy their Class | B stock. | selectodude wrote: | You can't buy class B google stock. It's owned solely by | Larry Page, Sergei Brin, and a handful by Eric Schmidt and | others. They're not traded on public markets and give Page | and Brin alone 51 percent of all voting rights. Furthermore, | if any class B shares are sold, they're converted to class A | and lose their 10x voting power. | quickthrowman wrote: | Class A shares (GOOGL) have one vote, Class C shares (GOOG) | have 0 votes | Thaxll wrote: | Worth $28B and only have revenues of $450M a year, that should | explain, this compagny is overevaluated. | ksec wrote: | I could see Cloudflare grow at least another 4X in the next | 4-5 years without any other product. That put it at ~2B | Revenue. | | That isn't too bad. And considering they are still innovating | and working on products that directly competes with AWS and | EC2, all of a sudden $28B valuation isn't so crazy. AWS is | $40B revenue alone and still growing 33% YoY. The whole Cloud | industry still have room to grow with no ceiling in sight. | | While the whole stock market is definitely bubbling at the | moment. I wouldn't say Cloudflare is overvalued on its growth | factor. | thefounder wrote: | The whole market is overvalued. It has become a kind of | bitcoin. Fundamentals don't matter anymore. It's positioning | and volume. | MuffinFlavored wrote: | > The whole market is overvalued. | | This is actually fake news and I'll tell you why. | | Bond yields have never been this low. No other alternatives | to park capital if you are seeking yield/return. | | The market is actually correctly valued if you take M2 | money circulation/supply into account as well. Something | like that. I read it on r/investing. You have to sift | through the weed/penny stock posts to find the good | information. | thefounder wrote: | >> No other alternatives to park capital if you are | seeking yield/return. | | So you park it into bitcoin and stocks that grow... even | if there is no reason for them to grow. I believe my | assertion still stands that price is set by positioning | and volume not by fundamentals. I wouldn't say that that | companies are overvalued...the valuation for most of them | has little to do with the reality. For example investing | in bitcoin or Tesla becomes more and more the same thing. | khyryk wrote: | I've been thinking about this for a while. Let's say that | the USD is indeed 40% devalued and the market melted up | significantly as a result of this -- does this not make | "value" stocks a massive bargain? That is, if something | was at a PE of 10 before the money printing, has | maintained reasonable fundamentals, and remains at a PE | of 10, isn't it stunningly undervalued if the same money | printing is used to justify "growth" stock rallies? | [deleted] | reducesuffering wrote: | *Current revenues of $450M a year. However, $28B for revenues | of $5b a year, 10 years out? Undervalued with ZIRP. | dmead wrote: | cloudflare has been talked about on WSB and /r/stocks for | months. it's probably pumped a good bit already and this was a | reality check. | notyourwork wrote: | To be concerned with any noise associated with WSB or others | is dependent on your time horizon. If Im buying Cloudflare | because I plan to own it in 5-10 years, that is likely moot. | If you want to get rich quick, its a bet like any other. | Traster wrote: | >I predict that one day, we'll see a C somewhere in "FAANGM". | | Honestly, this is such a stupid game. The original acronym was | FANG. It included Netflix which at the time it was coined was | orders of magnitude smaller than Apple, the acronym didn't | include Apple, and now it has about 10 different deriviations | which does and does not include Netflix (whose core business | has been invaded by not only Apple and Amazon but also Disney | and HBO), but does include Microsoft - which isn't whilst very | successful, isn't dominant anywhere. | | The whole value of FANG was that it spelt out the word fang - | beyond that, it was completely devoid of meaningful value. It | works in the same way that a big red button Jim Cramers' desk | works. It doesn't. | pbiggar wrote: | FAANG was originally about companies that paid massive | engineering salaries, which is why Netflix was included and | Microsoft wasn't. | reducesuffering wrote: | No it wasn't. Cramer coined it due to just FANG (not apple) | being totally dominant in their markets and having meteoric | rises in stock prices at that time.[0] | | [0]https://en.wikipedia.org/wiki/Big_Tech#FAANG | ptero wrote: | > Down 6% after hours, for reasons that I don't understand | | "Buy on the rumors, sell on the news". Sell on the news part I | think | gsich wrote: | Better find a way to add the C In "GMAFIA". | jvanderbot wrote: | The stock market is not about buying ownership in long-term | stable, profitable companies, unless you zoom wwaaaaaaaaaaay | out on the charts. | | Day to day it's about riding hype up and jumping off before | anyone else. | | CISCO was a great example of this back in the day. | https://www.fool.com/investing/2020/12/27/2020-incredible-st... | BitwiseFool wrote: | CAMFANG? | alex_young wrote: | FC'G A MAN | whoisburbansky wrote: | > Down 6% after hours, for reasons that I don't understand. | | Not trying to be snarky, but this is how I feel about pretty | much all AH movement after earnings, for any company. Do you | usually not feel this way? | edmundsauto wrote: | I think this is the most accurate way to feel about market | movement. People who give you explanations might be right, | but how would they even know? Stock narratives are post hoc | divination a without much exploration of alternative | explanations. | | I tell myself that any explanation might be a neat story, but | what evidence is there that isn't just someone's opinion? | (Not much, usually.) | darkwizard42 wrote: | It pretty much comes down to how expected or unexpected the | guidance and exceeds/misses are on the metrics of interest. | | If you know that FB, GOOG, PINS are all having amazing | quarters, you might see SNAPs price rise in advance of their | earnings because if some other big ad/social network giants | are doing well, surely SNAP will too! | | Then there are truly amazing beats or misses by companies and | the street tracks those as well. | | A more recent example might be Lyft & Uber. Lyft actually | came in at the top end of QoQ rev growth and cut losses well. | Uber's options market and stock immediately reflected Lyft's | earnings report even though Uber was still 24 hours away from | reporting. Uber's report was good not great but the stock had | already gained in the day prior and thus not much left to | squeeze up. | | Just my 2 cents on how some of these things happen | blantonl wrote: | The stock has had a 25% run up to earnings in the past month. | It's a classic buy the rumor sell the news. | | Here's your opportunity to buy the dip. | vmception wrote: | and if it was up you would have said "new information that | the market was not able to price in" or "the forward guidance | was good" or just congratulate the leadership | djrogers wrote: | And it would still likely be correct. The market reacts to | news - not met expectations. | jedberg wrote: | > Down 6% after hours, for reasons that I don't understand. | | I think the street was hoping for a rosier outlook on | profitability next quarter. | rvz wrote: | > Down 6% after hours, for reasons that I don't understand. | | Well time to buy some on Friday near market close then before | it reaches >$100. | subsaharancoder wrote: | this is typical behavior of stocks, even with stellar earnings | many of them go down after hours, go checkout Corsair | mathattack wrote: | The valuation is based on hyper-aggressive growth expectations | that compound over time. If you shave even a few percent off | the growth projections stock takes a hit. | | It's hard to switch your CDN provider in the short term, but | it's feasible that Amazon, MSFT or Google could bump them out | of every large enterprise in the long term. | acdha wrote: | > It's hard to switch your CDN provider in the short term, | but it's feasible that Amazon, MSFT or Google could bump them | out of every large enterprise in the long term. | | That's what I'd worry about, too: for a large company, | there's a fairly large cost to dealing with each new vendor. | Once Amazon, Microsoft, Google, etc. has a CDN which is | competitive for your needs someone is going to ask whether | the extra benefits are greater than the cost of managing a | contract, security, training, etc. | llboston wrote: | Revenue is $125m this quarter, about 50% over last year. P/S is | around 60, which might be too high to many people and therefore | the correction. | quickthrowman wrote: | Before 0% interest and euphoria, 20-40x was a good SaaS | NTM/Revenue multiplier. SNOW is upwards of 200x at this point | I believe | tootie wrote: | It's a mantra of stock trading to buy on rumor and sell on | news. This report was likely already priced in based on | estimates. | dcolkitt wrote: | Does Cloudflare have any defensible moat? If Google or | Microsoft decided to muscle Cloudflare out of business | tomorrow, what's to stop them? In comparison, we already know | that Google can't take out Facebook. | tidepod12 wrote: | The major Cloudflare products (namely the CDN, WAF, DDoS | protection, DNS management, and even serverless workers) are | already replicated in AWS, GCP, and Azure. AFAIK the main | thing that draws people to Cloudflare instead is "it's easier | to use than bloated AWS/etc." And while that might be a | completely valid value proposition, I'm not sure if it's a | long term winner, especially as more and more companies | migrate to the big 3 cloud providers. | | It reminds me a lot of Dropbox and the situation where for | years Dropbox's value proposition was "yea OneDrive and | iCloud provide the same service, but people like Dropbox | because it is independent, unbloated, and simpler to use". | But over time that's become less true, and as more and more | companies move to using O365, they end up getting OneDrive as | part of the deal anyway. And once you're already working in | an environment with OneDrive, why continue using Dropbox? | rusteh1 wrote: | I wouldn't call Cloudfront bloated. It is under featured if | anything, the product has seen little change in the past | few years. | DamnYuppie wrote: | My feeling is that the price had risen expecting a more stellar | result or bullish guidance. When the street didn't get that | they took their profits and ran. | | You can watch the same thing happen to CRM and ZM now in the | days leading up to their next earnings call. | spoonjim wrote: | What does it mean "the street took their profits and ran"? | Who did they sell the stock to? | aaomidi wrote: | To buyers who had placed orders way lower than what the | stock was worth. | nostrademons wrote: | Folks like the OP who believe CloudFlare is a good long- | term buy but weren't paying attention before the earning's | announcement. | | There's usually some subsegment of investors that believe | that earnings are going to be really good, bid up the price | beforehand, and figure they'll sell after earnings. If that | group is smaller than the folks who see the earnings and | figure it actually _is_ a really good buy that they want to | own, you get a stock pop after earnings. If the former | group is larger than the latter, you get a stock drop. This | cycle the former was bigger than the latter for CloudFlare. | It 's gone the other way both other cycles for CloudFlare | and this cycle for other stocks. (Google and Disney, for | example, got large after-hours pops after earnings.) | BasedInfra wrote: | I mean this absolutely no thesis and it's money I can lose but | been invest in companies that have solid, quality documentation. | | As one of them cloudflare's done me a solid so far. | xorx wrote: | Maybe I'm too old, and stuck in the mud with the pre-ICANN | intention of the original TLDs, but does it seem odd to anyone | else that they host their network services on .com and their | corporate information on .net? | judge2020 wrote: | I think the joke here is that their stock symbol is NET. | azinman2 wrote: | Surprised they could get that after all the net related | terminology in the early 2000s. | byhemechi wrote: | Cloudflare is one of those things that if I'm asked about it I'll | sound more positive than astroturfing. Their API's a re great, | I've had to contact support _once_ and my experience was good and | their rates are certainly reasonable for the scale of projects I | 've used them on. | buckybadger14 wrote: | What is the market for cloudflare? Do you think every company who | has a website will use some of their products? Understanding | TAM... ___________________________________________________________________ (page generated 2021-02-11 23:00 UTC)