Cloudflare Surges 10% on OpenAI, SpaceX Pacts

Cloudflare shares surged more than 10% to about $313 on Wednesday. Investors reacted positively to new partnerships connecting the cybersecurity firm with OpenAI and SpaceX.

The company operates a network across more than 300 data centers. Its second-quarter revenue increased 36% year over year to $696.1 million, reflecting solid demand before the recent announcements.

On 3 September, Cloudflare introduced Vulnerability Discovery and Remediation with OpenAI. The service merges live traffic data with OpenAI Daybreak cybersecurity models to detect vulnerabilities and draft fixes automatically. In addition, SpaceX customers can now run Cursor Cloud Agents inside isolated Cloudflare Sandboxes. These tools build on the recent launch of Adaptive Intelligence, a detection engine built to counter automated bots.

Wall Street holds a Strong Buy consensus on Cloudflare, based on 22 Buy ratings, five Holds, and one Sell. The average price target of $348 implies about 11% upside from Wednesday's closing level.