Cloudflare shares jump 8% after raising annual outlook on AI demand

Cloudflare shares rose 8% on Friday after jumping as much as 16% in premarket trading, following the cloud services company’s decision to raise its annual forecasts on growing enterprise demand for artificial intelligence infrastructure.

The company now expects full year revenue between $2.86 billion and $2.87 billion, up from its previous forecast of $2.805 billion to $2.813 billion.

Cloudflare also raised its adjusted earnings per share outlook to between $1.25 and $1.26, compared with its earlier estimate of $1.19 to $1.20.

The results, released after markets closed Thursday, add to signs that growing AI adoption is increasing demand for companies providing the networking, security and software infrastructure used to build and operate AI applications.

Cloudflare added roughly 2 million developers during the second quarter alone, surpassing the 1.5 million developers it added throughout last year.

TD Cowen analysts said Cloudflare is well positioned to play a leading role as AI adoption expands.

Morgan Stanley analysts pointed to Cloudflare’s Workers developer platform as its fastest growing segment amid a shift toward a usage based business model. The analysts said the company could exceed its updated outlook.

Cloudflare’s security business could also benefit from companies seeking additional protection for AI powered applications and workers as cyber threats become more sophisticated.

The earnings follow Amazon’s strongest cloud growth in more than four years. Amazon recently said it expects capacity constraints to prevent the company from meeting all available demand this year.

Cloudflare shares have gained more than 44% so far in 2026. The stock trades at more than 190 times forward earnings, compared with more than 145 times for CrowdStrike, according to LSEG data.