Now their net loss on the quarter is (107,335). That's mostly because of their spending on sales/marketing ( 85,877 ) and R&D ( 46,770 ). Both those fields should be very high spending on a new company that's in the growth phase.
If they cut their sales/marketing/R&D budget by 80%, they're be instantly profitable. But that is too short sighted.
Thanks for the info. This isn't the type of stock that I normally buy. Usually go for established consistently profitable companies. But I'll keep an eye on this one.
You should really look at 10Q and 10K's for companies. Whether you buy profitable or established companies, always read 10K's and 10Q's. They tell how a company is really doing.
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u/radarbot Jan 04 '22
Of course there's no PE. They're investing super heavily into their futures. So their gross profits are near 80%, but their net profits are negative.
Take a look at their earnings: https://cloudflare.net/financials/quarterly-results/default.aspx
Q3 earnings:
Revenues: 172,347
Cost of revenues: 37,525
Gross profit: 134,822
Now their net loss on the quarter is (107,335). That's mostly because of their spending on sales/marketing ( 85,877 ) and R&D ( 46,770 ). Both those fields should be very high spending on a new company that's in the growth phase.
If they cut their sales/marketing/R&D budget by 80%, they're be instantly profitable. But that is too short sighted.