Cloudflare, in its earnings report for Q4 2024, has revealed how it is leveraging AI (artificial intelligence) across four key opportunities that position it as a leading innovator.
Cloudflare has reported revenue of $459.9 million (up 27 percent) in Q4 2024 and $1.669 billion (up 29 percent) in 2024. Cloudflare is targeting first-quarter revenue of $468-$469 million and $2.09 billion to $2.094 billion in 2025 thanks to its AI focus.
“We saw record growth in our largest customers, those that spend more than $1 million with Cloudflare per year — closing the year with 173. We added 55 of those customers in 2024, and more than half of these new additions came in during fourth quarter alone,” said Matthew Prince, co-founder & CEO of Cloudflare.
“We delivered ground-breaking innovation, especially in AI, and remained focused on delivering real ROI for customers,” Matthew Prince said.
Cloudflare is utilizing AI to enhance its internal business processes. While this is a standard practice, what sets Cloudflare apart is its ability to build and run AI functions on its own infrastructure, minimizing reliance on third-party providers and ensuring greater efficiency and cost-effectiveness.
AI has been an integral part of Cloudflare’s approach to cybersecurity and performance optimization. The company processes vast amounts of internet traffic, enabling its machine learning systems to identify security threats before they are widely recognized. This capability strengthens Cloudflare’s security offerings, providing proactive protection to customers.
One of the most promising applications of AI for Cloudflare is its serverless platform, Cloudflare Workers. This architecture is ideal for AI-driven applications, particularly AI inference and agent-based workflows. Cloudflare’s serverless model allows customers to pay only for the CPU or GPU resources they actually use, offering significant cost savings compared to traditional hyperscale cloud providers.
Key benefits include AI Gateway, where developers using Cloudflare’s AI Gateway have seen up to a 10x improvement in price-performance by caching responses instead of repeatedly querying the original model provider.
Inference efficiency is another advantage, as Cloudflare’s pay-per-inference model enables customers to reduce costs significantly compared to provisioning dedicated resources on hyperscaler platforms. Additionally, Cloudflare’s engineering team has made substantial strides in optimizing GPU utilization, reducing waste, and improving performance.
Cloudflare sits at the intersection of major AI companies and content creators, positioning itself as a key player in defining the business model for the post-search internet era.
The company is actively engaging with stakeholders to establish fair compensation models for content creators whose work is used to train AI models, define access controls and permissions for AI agents, and develop policies and frameworks for how AI-powered services interact with the broader web ecosystem.
Rajani Baburajan
