Cloudflare Earnings Takeaways: Zero Trust, Generative AI Security, Channel Growth

Channel-Led Deals

Crucially, on Cloudflare’s major deal with the Fortune 500 energy company last quarter, “we worked with a large channel partner to win and service this customer, and expect we’ll be doing more with them going forward,” Prince said during the quarterly call. Cloudflare is not disclosing the name of this partner, the company told CRN Thursday.

In June 2022, the company announced the launch of the Cloudflare One Partner Program, which aims to enable channel partners such as resellers and systems integrators to more effectively deliver the company’s platform for zero trust remote access — known as secure access service edge (SASE) — to customers. Later on during the call, after a question about the company’s work with the channel, Prince added that “I think that channel remains a big opportunity for us.”

“But we’re proud of the progress that we’ve made. And it’s a real priority for [President of Revenue] Marc [Boroditsky]. I think that we’re seeing both the traditional resellers as well as some of the GSIs that are increasingly adopting Cloudflare. And I think the big opportunity here is really with those act two [zero trust products] — and then to some extent those act three [Workers] products,” Prince said. “And so we’re seeing that in act two products, those are very much products that oftentimes we are winning in cooperation with the channel partner. And those initial wins help unlock future wins going forward.”

In terms of the “act three” Workers products, customers are increasingly going to partners for help with consolidating vendors and saving money on their cloud spending, he said. “We’re seeing more and more that Cloudflare is a solution that is in the toolkit for people who are trying to figure out how they can save money. So moving from an S3 to an R2 is a substantial savings.”