In June, Cloudflare (NYSE:NET) CEO Matthew Prince announced a milestone: more of the internet's traffic now comes from bots than from people, led by AI agents. He would know. Much of that traffic crosses Cloudflare's network, the layer keeping websites secure and fast. Team Rule Breakers and Team Hidden Gems have both recommended Cloudflare more than once. The market is catching on, sending the stock up more than 40% this year.
- Building what the next internet runs on: Cloudflare's Workers platform lets customers run code and AI agents on its network without managing servers. It's also building encryption to survive quantum computers, machines that could defeat today's security. As agents grow smarter, their traffic grows more valuable.
- Customers keep spending more: Cloudflare keeps landing more big-spending customers, and existing ones spend more. Revenue grew 36% year over year. Its dollar-based net retention rate hit 120%. The more a business runs on it, the harder it is to rip out.
Cloudflare still loses money by GAAP standards, and Prince doesn't apologize. Free cash flow grows anyway. He told investors in August, "The business model of the next 27 years of the internet is going to be very different, and there's no company in a better position to define what it looks like than Cloudflare."
Team Hidden Gems has a five-year price prediction of $486.17.
Team Rule Breakers has a five-year price prediction of $508.21.
Shares trade around $280 today.
