A fairly unrelated point, but its so strange how companies that underpin a lot of the internet struggle in the stock market. While we all wish we had sold our tech stocks in 2021, Cloudflare still hasn't recovered.
Cloudflare has a very dysfunctional sales pipeline. Their free, premium and self-serve offerings might underpin the internet, but the highly profitable offerings that are gated behind their sales teams are not getting sold. Too many of the clients that they should be selling to.
Magic Transit (bring your own ASN), classic website DDoS protection (above the Business $200 tier, which has low, undisclosed data limits in regions like New Zealand) and ilk all require interacting with the sales rep, and unless your paying 5 figures a month they are disinterested.
There is a whole market out there between $300 to $2000 a month that Cloudflare could tap without making new infrastructure but is actively being ignored.
Not to mention they have on multiple occasions made significant internal changes (including layoffs) to their sales organization. I have a feeling if the public were to get an introspection into their sales pipeline it would be eye opening, and not in a good way
I believe Cloudflare (and many other cos like it) have never produced operating income. They are growing and obviously important and potentially very profitable in the future, but when discount rates are much higher and you add in some uncertainty, one could argue they don't look as hot as they used to.
It is bizzare. All the old guard foundations of society type companies that the world relies on for modernity have stocks that barely budge but pay out decent dividends. Maybe tech stocks that have grown to such a position should consider paying out dividends instead of failing to chase exponential stock price growth while still clearly doing a lot of productive things. I expect the shareholder boards prefer the chance of exponential wealth over steady returns and prevent this mindset from emerging.
Magic Transit (bring your own ASN), classic website DDoS protection (above the Business $200 tier, which has low, undisclosed data limits in regions like New Zealand) and ilk all require interacting with the sales rep, and unless your paying 5 figures a month they are disinterested.
There is a whole market out there between $300 to $2000 a month that Cloudflare could tap without making new infrastructure but is actively being ignored.