Comment by cocoacat
2 months ago
Their stock has gone down nearly 20% in early trading today. When layoffs happen, usually it is the opposite, so I imagine Matthew Prince must be annoyed!
I am disappointed by this decision from Cloudflare. I've always felt that massive layoffs are something that companies who are greedy and don't care about their employees do (like Amazon and Meta). Up until now, my impression of Cloudflare has been that they care about their societal impact to an extent and still share old values from how tech companies used to be. Maybe they're starting the downward make-money-at-all-costs spiral that has gripped the rest of tech.
Their valuation is crazy. Trading at $260, with no profit, their price:sales ratio was 36x (extremely high). Now, trading at $195, their price:forward earnings ratio is 130x (extremely high). Unless they crushed earnings and revenue estimates and juiced their forward guidance, Cloudflare stock could have gone anywhere. Also, the stock is trading where it was a month ago.