Cloudflare, Inc. shares skyrocketed 16.9% in after-hours trading, driven by a powerful combination of better-than-expected second-quarter results and a significantly raised full-year outlook that underscored accelerating demand for its AI-driven network services.

The company reported second-quarter revenue of $696.1 million, a 36% jump from the prior year and well above the analyst consensus of $665.5 million. Adjusted earnings per share reached $0.29, surpassing the $0.27 estimate. For the third quarter, Cloudflare guided for revenue between $736 million and $737 million and adjusted EPS of $0.34, both comfortably exceeding Street forecasts. Full-year guidance was also lifted, with revenue now expected in the range of $2.86 billion to $2.87 billion and adjusted EPS of $1.25 to $1.26, up from prior estimates of $2.81 billion and $1.20 per share.

The results validated growing investor optimism around Cloudflare’s strategic positioning in the AI era. CEO Matthew Prince highlighted the company’s role in building infrastructure for the “Agentic Internet,” as the web shifts toward AI answer engines and agent-driven commerce, fueling increased machine-to-machine traffic across its network. Multiple Wall Street analysts responded by raising price targets, with firms like Scotiabank, BTIG, and RBC citing the robust outlook and AI tailwinds.