Artificial intelligence boosts cloud demand, Cloudflare's annual sales will exceed expectations, and the company's stock price surged after hours.

Cloudflare predicted on Tuesday that its full-year and first-quarter sales will exceed Wall Street expectations, betting that the rapid development of artificial intelligence technology will drive demand for its cloud services. The company's stock surged nearly 12% in after-hours trading. Industries across the board are integrating artificial intelligence, leading to increased demand for cloud computing as companies prioritize spending on the digital infrastructure needed to develop this rapidly growing technology. Cloudflare also expects to benefit from the rise of AI agents, such as the recently renamed "OpenClaw" from "Clawdbot," which allows users to safely route traffic to their private computers using the cloud company's technology, enabling remote control without compromising home network security. CEO Matthew Prince said in a statement, "The shift towards AI and agents represents a fundamental re-platforming of the internet, driving demand for all of Cloudflare's services." Cloudflare expects sales for 2026 to be between $2.79 billion and $2.8 billion, higher than the expected $2.74 billion. The company also expects first-quarter sales to be between $620 million and $621 million, higher than the expected $613.9 million. After its stock rose over 83% in 2025, the company's stock has fallen more than 8% so far this year.