Cloudflare, Inc.NET

Cloudflare, Inc. Revenue Disclosure

10-KFiled Feb 26, 20262 min read
Revenue
Disaggregation of Revenue
Subscription and support revenue is recognized over time and accounted for substantially all of the Company’s revenue for the years ended December 31, 2025, 2024, and 2023.
The following table summarizes the revenue by region based on the billing address of customers who have contracted to use the Company’s global network and products:
Year Ended December 31,
202520242023
(dollars in thousands)
AmountPercentage
of Revenue		AmountPercentage
of Revenue		AmountPercentage
of Revenue
United States$1,072,996 49 %$849,500 51 %$678,184 52 %
Europe, Middle East, and Africa
598,624 28 %466,499 28 %356,569 28 %
Asia Pacific329,760 15 %223,234 13 %168,826 13 %
Other166,557 8 %130,393 8 %93,166 7 %
Total$2,167,937 100 %$1,669,626 100 %$1,296,745 100 %
The following table summarizes the revenue from contracts by type of customer:
Year Ended December 31,
202520242023
(dollars in thousands)
AmountPercentage
of Revenue		AmountPercentage
of Revenue		AmountPercentage
of Revenue
Channel partners
$568,867 26 %$337,394 20 %$202,404 16 %
Direct customers
1,599,070 74 %1,332,232 80 %1,094,341 84 %
Total$2,167,937 100 %$1,669,626 100 %$1,296,745 100 %
Contract Balances
Contract liabilities consist of deferred revenue and include payments received in advance of performance under the contract. Such amounts are recognized as revenue over the contractual period. For the year ended December 31, 2025, the Company recognized revenue of $467.5 million, that was included in the corresponding contract liability balance at the beginning of the period presented.
The Company receives payments from customers based upon contractual billing schedules; accounts receivable are recorded when the right to consideration becomes unconditional. Standard payment terms are due upon receipt.
Contract assets include amounts related to the Company’s contractual right to consideration for both completed and partially completed performance obligations that have not been invoiced.
The following table summarizes the activity of the deferred contract acquisition costs:
Year Ended December 31,
202520242023
(in thousands)
Beginning balance$172,217 $133,236 $93,145 
Capitalization of contract acquisition costs
148,905 116,803 101,465 
Amortization of deferred contract acquisition costs
(101,623)(77,822)(61,374)
Ending balance$219,499 $172,217 $133,236 

The Company did not recognize any impairment losses of deferred contract acquisition costs during the periods presented.
Remaining Performance Obligations
As of December 31, 2025, the aggregate amount of the transaction price allocated to remaining performance obligations was $2,495.8 million. As of December 31, 2025, the Company expected to recognize 63% of its remaining performance obligations as revenue over the next 12 months with the remainder recognized thereafter.
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Historical Timeline

Fiscal YearFiled
2025Feb 26, 2026Showing above
2024Feb 20, 2025
2023Feb 21, 2024
2022Feb 24, 2023
2021Mar 1, 2022
2020Feb 25, 2021
2019Mar 4, 2020

About Revenue Disclosures

Revenue disclosures under ASC 606 explain how a company identifies performance obligations, allocates transaction prices, and determines when revenue is recognized. This section is essential for understanding whether reported revenue reflects genuine economic activity or aggressive accounting choices. Analysts examine the mix of point-in-time versus over-time recognition, which directly affects revenue timing and comparability.

Key signals: rising contract liabilities (deferred revenue) suggest strong future revenue visibility, while declining contract assets may indicate slowing project milestones. Watch for variable consideration estimates — rebates, returns, and performance bonuses that require management judgment. Significant changes in disaggregated revenue by geography or product line can reveal shifting business mix before it appears in headline numbers. Compare revenue growth against contract liability growth to assess sustainability, and scrutinize any changes in the timing of recognition that coincide with earnings pressure.

Other Available Disclosures

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