Cloudflare Inc (NET) 2022 Q2 法說會逐字稿

Good afternoon. My name is Emma, and I will be your conference operator today. At this time, I would like to welcome everyone to the Cloudflare Second Quarter 2022 Earnings Call. (Operator Instructions) Thank you.

下午好。我的名字是艾瑪，今天我將成為您的會議接線員。在這個時候，我想歡迎大家參加 Cloudflare 2022 年第二季度財報電話會議。 （操作員說明）謝謝。

Jayson Noland, VP of Investor Relations. You may begin your conference.

Jayson Noland，投資者關係副總裁。你可以開始你的會議了。

Thank you for joining us to discuss Cloudflare's financial results for the second quarter of 2022. With me on the call, we have Matthew Prince, Co-Founder and CEO; Michelle Zatlyn, Co-Founder President and COO; and Thomas Seifert, CFO.

感謝您與我們一起討論 Cloudflare 2022 年第二季度的財務業績。與我通話的還有聯合創始人兼首席執行官 Matthew Prince； Michelle Zatlyn，聯合創始人總裁兼首席運營官；和首席財務官 Thomas Seifert。

By now, everyone should have access to our earnings announcement. This announcement as well as our supplemental financial information may be found on our Investor Relations website.

到目前為止，每個人都應該可以訪問我們的收益公告。本公告以及我們的補充財務信息可在我們的投資者關係網站上找到。

As a reminder, we'll be making forward-looking statements during today's discussion, including, but not limited to, our customers, vendors and partners operations and future financial performance; anticipated product launches and the timing and market potential of those products, the company's anticipated future revenue, financial performance, operating performance, non-GAAP gross margin, non-GAAP net income or loss, non-GAAP net income or loss per share, shares outstanding, non-GAAP operating expenses, free cash flow, non-GAAP tax expense, dollar-based net retention rate, paying customers and large customers.

提醒一下，我們將在今天的討論中做出前瞻性陳述，包括但不限於我們的客戶、供應商和合作夥伴的運營以及未來的財務業績；預期的產品發布以及這些產品的時間和市場潛力、公司的預期未來收入、財務業績、經營業績、非公認會計準則毛利率、非公認會計準則淨收入或虧損、非公認會計準則每股淨收入或虧損、股票未償的、非 GAAP 運營費用、自由現金流、非 GAAP 稅收費用、基於美元的淨保留率、付費客戶和大客戶。

These statements and other comments are not guarantees of future performance but rather are subject to risks and uncertainties, some of which are beyond our control, including, but not limited to, challenging general economic conditions, including inflation, rising interest rates and other impacts of the ongoing COVID-19 pandemic and Russia-Ukraine conflict. Our actual results may differ significantly from those projected or suggested in any forward-looking statements. These forward-looking statements apply as of today, and you should not rely on them as representing our views in the future. We undertake no obligation to update these statements after this call. For a more complete discussion of the risks and uncertainties that could impact our future operating results and financial condition, please see our filings with the Securities and Exchange Commission as well as in today's earnings press release.

這些陳述和其他評論不是對未來業績的保證，而是受到風險和不確定性的影響，其中一些是我們無法控制的，包括但不限於具有挑戰性的總體經濟狀況，包括通貨膨脹、利率上升和其他影響持續的 COVID-19 大流行和俄羅斯-烏克蘭衝突。我們的實際結果可能與任何前瞻性陳述中預測或建議的結果大不相同。這些前瞻性陳述自今天起適用，您不應依賴它們來代表我們未來的觀點。我們不承擔在本次電話會議後更新這些聲明的義務。有關可能影響我們未來經營業績和財務狀況的風險和不確定性的更完整討論，請參閱我們向美國證券交易委員會提交的文件以及今天的收益新聞稿。

Unless otherwise noted, all numbers we talk about today other than revenue will be on an adjusted non-GAAP basis. All current and prior period financials discussed are reflected under ASC 606. You may find a reconciliation of GAAP to non-GAAP financial measures in our earnings release on our Investor Relations website. For historical periods, our GAAP to non-GAAP reconciliation can be found in the supplemental financial information referenced a few moments ago.

除非另有說明，我們今天談論的除收入外的所有數字都將基於調整後的非公認會計原則。討論的所有當前和前期財務狀況都反映在 ASC 606 中。您可以在我們的投資者關係網站上的收益發布中找到 GAAP 與非 GAAP 財務指標的對賬。對於歷史時期，我們的 GAAP 與非 GAAP 對賬可以在剛才引用的補充財務信息中找到。

We would also like to inform you that we will be participating in the Stifel Tech Executive Summit on August 30, the Deutsche Bank Technology Conference on September 1 and the Piper Sandler Growth Frontiers Conference on September 13.

我們還想通知您，我們將參加 8 月 30 日的 Stifel 技術高管峰會、9 月 1 日的德意志銀行技術會議和 9 月 13 日的 Piper Sandler 增長前沿會議。

Now I'd like to turn the call over to Matthew.

現在我想把電話轉給馬修。

Thank you, Jayson. Even with the increased economic uncertainty, we had a very strong quarter. In Q2, we achieved revenue of $234 million, up 54% year-over-year. We added a record 212 new large customers, those paying us more than $100,000 per year, and now have 1,749 customers over this threshold. These large customers now represent 60% of our revenue, up from 50% 6 quarters ago. This trend illustrates how large, established enterprises increasingly form the foundation of Cloudflare's business. In fact, today, 29% of the Fortune 1000 are already paying Cloudflare customers, a nearly threefold increase over when we went public less than 3 years ago.

謝謝你，傑森。即使經濟不確定性增加，我們的季度表現也非常強勁。第二季度，我們實現了 2.34 億美元的收入，同比增長 54%。我們增加了創紀錄的 212 名新大客戶，這些客戶每年向我們支付的費用超過 100,000 美元，現在有 1,749 名客戶超過了這個門檻。這些大客戶現在占我們收入的 60%，高於 6 個季度前的 50%。這一趨勢說明了成熟的大型企業如何越來越多地構成 Cloudflare 的業務基礎。事實上，今天，29% 的財富 1000 強企業已經向 Cloudflare 客戶付款，這比我們不到 3 年前上市時增加了近三倍。

Our dollar-based net retention remained strong at 126%, down 1% over last quarter. While there may be some noise in this number from quarter-to-quarter, we won't be satisfied until it's above 130% and best of breed among the companies we consider peers.

我們以美元為基礎的淨留存率保持在 126% 的強勁水平，比上一季度下降 1%。雖然每個季度的這個數字可能會有一些噪音，但我們不會滿意，直到它超過 130% 並且在我們認為是同行的公司中是同類公司中最好的。

Our gross margin remained strong at 78.9%, up 90 basis points year-over-year and still over our long-term target of 75% to 77%. Our operating margin was right at breakeven, which continues to be our plan so long as we can deliver strong growth. What I'm watching closely is our free cash flow margin. It showed significant improvement quarter-over-quarter, and we continue to forecast it will be positive in the second half of the year.

我們的毛利率保持在 78.9% 的強勁水平，同比增長 90 個基點，仍高於我們 75% 至 77% 的長期目標。我們的營業利潤率正好處於盈虧平衡點，只要我們能夠實現強勁增長，這仍然是我們的計劃。我正在密切關注的是我們的自由現金流邊際。它顯示出顯著的季度環比改善，我們繼續預測它在下半年將是積極的。

On our last earnings call, I got a lot of raised eyebrows from many of you when I said Q1 of 2022 would prove to be the hardest quarter for our industry since Q1 of 2020. It didn't make me particularly popular around the CEO club, where the first rule of recession is not to talk about recession. However, transparency has always been one of Cloudflare's core values, so I'm going to call it like I see it. In that spirit, let me share some more details of what we saw and are seeing.

在我們上次的財報電話會議上，當我說 2022 年第一季度將被證明是我們行業自 2020 年第一季度以來最艱難的一個季度時，很多人對此表示不滿。這並沒有讓我在 CEO 俱樂部中特別受歡迎，衰退的第一條規則是不要談論衰退。然而，透明度一直是 Cloudflare 的核心價值之一，所以我會像我看到的那樣稱呼它。本著這種精神，讓我分享一些關於我們所見和所見的更多細節。

In Q1, our pipeline generation slowed, sales cycles extended, and customers took longer to pay their bills. We watched those metrics closely throughout Q2 and saw them all at least stabilized. They're not where we throw up hooray yet, but the metrics are trending in the right direction. Given our visibility early into the economic downturn, we rapidly adjusted our go-to-market message. We shifted our messaging to focus on ROI, helping customers save money and consolidating spend from multiple point solution vendors behind Cloudflare's broad platform.

在第一季度，我們的管道生成放緩，銷售週期延長，客戶支付賬單的時間更長。我們在整個第二季度密切關注這些指標，並看到它們至少都穩定了。它們還不是我們拋出萬歲的地方，但指標正朝著正確的方向發展。鑑於我們在經濟衰退早期的可見性，我們迅速調整了我們的上市信息。我們將消息傳遞轉移到關注 ROI，幫助客戶節省資金並整合 Cloudflare 廣泛平台背後的多點解決方案供應商的支出。

Messages about saving money and using fewer vendors didn't particularly resonate a year ago, but they do today. Having a broad platform to solve so many customers' problems while at the same time saving the money is a superpower in times like these. As I look at our wins in the first half of the year, I believe it's fair to say that it's harder today than it was a year ago to sign up a new customer, but it's gotten easier to talk to our broad set of existing customers about doing more with us. And customers are leaning forward to hear about how we can save the money, reduce their IT complexity, all while increasing their security, performance and reliability.

關於省錢和使用更少供應商的信息在一年前並沒有引起特別的共鳴，但今天卻如此。在這樣的時代，擁有一個廣泛的平台來解決這麼多客戶的問題，同時又能省錢是一種超級大國。當我回顧我們在上半年取得的勝利時，我相信可以公平地說，現在簽約新客戶比一年前更難，但與我們廣泛的現有客戶交談變得更加容易關於與我們一起做更多的事情。客戶希望了解我們如何節省資金、降低 IT 複雜性，同時提高安全性、性能和可靠性。

I'm not a member of the National Board of Economic Advisors, so I'm not the person to say whether we're in a recession or not, how bad it may be or how quickly we may rebound. But I am the CEO of Cloudflare. And while our business remains strong, I believe this is a time for prudence and caution. The metaphor I've been using with our team is to talk about the different conditions you may face driving a car on the road. A year ago, we could see for miles and the road was clear, so it made sense to open up the throttle. Today, we find ourselves in what my grandmother used to call it tule fog. The road ahead is less certain, so it makes sense to keep our hands on the wheel, our eyes on the road and let up a bit on the accelerator.

我不是國家經濟顧問委員會的成員，所以我不能說我們是否處於衰退之中，它可能有多糟糕，或者我們反彈的速度有多快。但我是 Cloudflare 的 CEO。雖然我們的業務依然強勁，但我相信現在是謹慎行事的時候。我一直在與我們的團隊一起使用的比喻是談論您在路上駕駛汽車可能面臨的不同條件。一年前，我們可以看到數英里外的道路，而且道路暢通無阻，因此打開油門是有意義的。今天，我們發現自己置身於我祖母曾經稱之為 tule 霧的地方。前面的路不太確定，所以我們的手放在方向盤上，眼睛盯著路，稍微鬆開油門是有意義的。

Whether we're in one or not, recessions (expletive). They hurt everyone. No company is recession-proof. But some are more recession-resilient than others. Some things I know are universally true. No matter how bad this recession may get, companies aren't going to abandon the Internet. They're not going to give up on the cloud and go back to on-premise boxes and packaged software. Hackers aren't going to stop hacking, so cybersecurity will remain a must-have, not a nice to have. And we're already seeing evidence of all of this with our gross renewal rate in every region for the first half of the year, hitting all-time highs since we went public. We are not recession-proof, but I wouldn't trade places with any other CEO right now.

無論我們是否處於經濟衰退之中（咒罵）。他們傷害了所有人。沒有一家公司能夠抵禦衰退。但有些人比其他人更能抵禦衰退。我知道的一些事情是普遍正確的。無論這次經濟衰退有多嚴重，公司都不會放棄互聯網。他們不會放棄雲計算並回到內部部署盒和打包軟件。黑客不會停止黑客攻擊，因此網絡安全將仍然是必備品，而不是一件好事。我們已經看到了這一切的證據，我們上半年在每個地區的總續訂率達到了我們上市以來的歷史新高。我們無法抵禦經濟衰退，但我現在不會與任何其他 CEO 交換位置。

Personally, if I think back, my career has been defined by recessions. I think a lot of people's are. Recessions have always been hard, but they're also formative moments to focus and ultimately improve. In 2000, as the first dotcom bubble burst, the law firm I was supposed to go work for said they didn't need any more securities lawyers, but they could probably find a spot for me in their bankruptcy practice. At just that time, you reflect on whether watching companies implode was what I wanted to do with the rest of my life and pivoted to become an entrepreneur.

就個人而言，如果我回想起來，我的職業生涯是由衰退定義的。我想很多人都是。經濟衰退一直很艱難，但它們也是集中註意力並最終改善的形成時刻。 2000 年，隨著第一次互聯網泡沫破滅，我本應去工作的律師事務所說他們不再需要證券律師，但他們可能會在他們的破產業務中為我找到一席之地。就在那個時候，你思考看著公司內爆是否是我餘生想做的事情，並轉而成為一名企業家。

14 years ago, in 2008, at the onset of the last global recession, Google pulled their full-time offers for all their summer interns, which included my co-founder at Cloudflare, Michelle Zatlyn. If that hadn't happened, Cloudflare would have never been born. At the same time, I learned what a margin call was and, simply embarrassingly, literally had to borrow money from my mom to pay my rent. That's when I got an extremely personal lesson on the importance of free cash flow, and it's why I'm ensuring right now in this uncertain time that Cloudflare is prioritizing being free cash flow positive.

14 年前，也就是 2008 年，在上一次全球經濟衰退開始之際，谷歌取消了他們所有暑期實習生的全職工作，其中包括我在 Cloudflare 的聯合創始人 Michelle Zatlyn。如果那沒有發生，Cloudflare 就不會誕生。與此同時，我知道了追加保證金是什麼，而且很尷尬的是，我不得不向我媽媽借錢來支付房租。就在那時，我得到了關於自由現金流重要性的非常個人化的教訓，這就是為什麼我現在在這個不確定的時期確保 Cloudflare 優先考慮使自由現金流為正數。

Tough times force you to reevaluate everything you've done and become better. It's why the best companies come out of tough times even stronger than they went in. So maybe it's a bit masochistic but I'm looking forward to have Cloudflare get even better during some of the tough times for the global economy that seem likely ahead. Hands on the wheel, eyes on the road, letting up a bit on the accelerator.

艱難時期迫使你重新評估你所做的一切並變得更好。這就是為什麼最好的公司在艱難時期走出困境時甚至比他們進入時更強大。所以也許這有點自虐，但我期待著 Cloudflare 在全球經濟可能出現的一些艱難時期變得更好。手放在方向盤上，眼睛盯著路，稍微鬆開油門。

With that background and to avoid being too much of a bummer, let's talk about some great customer wins in the quarter. A Fortune 500 retailer in Europe signed a $1 million 3-year deal for multiple Cloudflare products. They wanted to reduce their operational complexity by replacing a number of point solutions with Cloudflare's broad platform. We became their web application firewall, content delivery network, bot management system and a number of other application protection services with our easy-to-manage platforms. Having proven success protecting their infrastructure, we're now talking to them about expanding to be their Zero Trust provider, too.

有了這樣的背景，為了避免太過分，讓我們談談本季度一些偉大的客戶勝利。歐洲的一家財富 500 強零售商簽署了一項價值 100 萬美元的 3 年期合約，用於購買多種 Cloudflare 產品。他們希望通過用 Cloudflare 的廣泛平台替換許多單點解決方案來降低運營複雜性。我們通過易於管理的平台成為他們的 Web 應用程序防火牆、內容交付網絡、機器人管理系統和許多其他應用程序保護服務。在證明成功保護他們的基礎設施後，我們現在正在與他們討論如何擴展成為他們的零信任提供商。

A Fortune 500 energy company signed a $784,000 3-year deal. They had been using Zscaler. They found Cloudflare solutions easier to use, more performant and integrate it across their full security control point. As I said last quarter, we like our win rates when we go head-to-head with Zscaler and Palo Alto Networks because our product is better and can scale to meet the needs of complex organizations like this one. And while we're still relatively new to this Zero Trust space, we're going head-to-head against them more and more often.

一家財富 500 強能源公司簽署了一份價值 784,000 美元的 3 年合同。他們一直在使用 Zscaler。他們發現 Cloudflare 解決方案更易於使用、性能更高，並將其集成到其完整的安全控制點。正如我上個季度所說，當我們與 Zscaler 和 Palo Alto Networks 正面交鋒時，我們喜歡我們的勝率，因為我們的產品更好，並且可以擴展以滿足像這樣的複雜組織的需求。雖然我們對這個零信任空間還比較陌生，但我們越來越頻繁地與他們正面交鋒。

Yet another Fortune 500 industrial company signed a $1.3 million 5-year upsell agreement. This customer first adopted Cloudflare in Q1 of 2022 and is already seeing ways they can use more of our platform. What's also notable is this is an example of us increasingly working with channel partners. We believe channel sales are especially important in the Zero Trust space. And in Q2, we successfully signed up half of Zscaler's top channel partners as new Cloudflare partners.

另一家財富 500 強工業公司簽署了 130 萬美元的 5 年追加銷售協議。該客戶於 2022 年第一季度首次採用 Cloudflare，並且已經看到了他們可以更多地使用我們平台的方法。同樣值得注意的是，這是我們越來越多地與渠道合作夥伴合作的一個例子。我們認為渠道銷售在零信任領域尤為重要。在第二季度，我們成功簽約了 Zscaler 的一半頂級渠道合作夥伴作為新的 Cloudflare 合作夥伴。

The State of Arizona expanded their use of our platform, signing a $770,000 1-year expansion deal. Arizona has been a long time Cloudflare customer and continues to expand the use of our platform as we launch new products. I still remember their first PO with us from several years back, which specified the address and method of shipping of our products as if we are a hardware vendor. We shipped them T-shirts, not hardware, and they have continued to grow with us ever since.

亞利桑那州擴大了他們對我們平台的使用，簽署了 770,000 美元的 1 年擴展協議。 Arizona 一直是 Cloudflare 的長期客戶，並在我們推出新產品時繼續擴大我們平台的使用範圍。我仍然記得幾年前他們與我們的第一個 PO，其中指定了我們產品的地址和運輸方式，就好像我們是硬件供應商一樣。我們為他們運送了 T 卹，而不是硬件，從那時起，他們一直與我們一起成長。

One of the world's largest advertising conglomerates signed a $1.7 million 1-year deal. They originally came to us last quarter under an attack that originated out of Russia. Seeing the power of our platform, this quarter, they expanded their engagement. This was yet another competitive Zero Trust deal against other leading Zero Trust vendors. Like we're hearing over and over again, this customer chose Cloudflare because of the strength of our broad platform and our ease of use. In the words of their Head of Cloud, with Cloudflare everything works, there are no issues.

世界上最大的廣告集團之一簽署了一項價值 170 萬美元的為期 1 年的協議。他們最初是在上個季度受到來自俄羅斯的攻擊而來到我們這裡的。看到我們平台的力量，本季度，他們擴大了參與度。這是針對其他領先的零信任供應商的又一具有競爭力的零信任交易。就像我們一遍又一遍地聽到的那樣，這位客戶之所以選擇 Cloudflare，是因為我們廣泛平台的優勢和易用性。用他們的雲主管的話來說，Cloudflare 一切正常，沒有問題。

One of the largest online recruiting firms signed a $5.5 million 3-year deal, they were an extremely technical buyer who put our entire platform to its paces. In the end, they demonstrated for themselves that we were, by far, the best of breed. This is also an example of how increasingly we're seeing executives bring Cloudflare to their new workplaces. In this case, the buyer knew us from his previous position and was our champion when he moved jobs and was promoted. In his words, you don't get fired for buying Cloudflare.

最大的在線招聘公司之一簽署了一份為期 3 年的 550 萬美元的合同，他們是一位極具技術含量的買家，他們讓我們的整個平台跟上它的步伐。最後，他們為自己證明了我們是迄今為止最好的品種。這也是我們越來越多地看到高管將 Cloudflare 帶到他們的新工作場所的一個例子。在這種情況下，買家從他以前的職位認識我們，並且在他調動工作和升職時是我們的擁護者。用他的話說，你不會因為購買 Cloudflare 而被解僱。

Workers continues to gain traction among developers. Last earnings call, I talked about the importance of building Workers into other platforms as the best shortcut to developer adoption. In Q2, we signed deals with one of the largest e-commerce platform, one of the fastest-growing web development platform and a next-generation database platform to embed Workers as a service as a preferred development environment. These deals represent hundreds of thousands of dollars in guaranteed revenue with upside as usage grows. But more importantly, we believe they are the fastest path to catalyzing a robust ecosystem around Cloudflare Workers and exposing its power to the broad community of developers.

工人繼續在開發人員中獲得吸引力。上次財報電話會議上，我談到了將 Workers 構建到其他平台作為開發人員採用的最佳捷徑的重要性。在第二季度，我們與最大的電子商務平台之一、增長最快的 Web 開發平台之一和下一代數據庫平台簽署了協議，將 Workers as a service 作為首選開發環境嵌入。這些交易代表了數十萬美元的保證收入，並且隨著使用量的增長而上漲。但更重要的是，我們相信它們是促進圍繞 Cloudflare Workers 建立一個強大的生態系統並將其力量展示給廣大開發人員社區的最快途徑。

Another interesting thing of note from the quarter is we're increasingly seeing other security companies adopting Cloudflare as the best-of-breed solution. It's incredibly affirming when your peers choose your product. A public security compliance vendor, a leading endpoint security provider and one of the largest data security vendors all signed multiyear contracts each worth more than $700,000. Even our direct competitors often use Cloudflare for DDoS mitigation and other services where we are the clear leader. This recognition by our peers of our best-of-breed products continues to validate why I'm confident Cloudflare will continue to grow even stronger through the tough economic times that may be ahead.

本季度另一個值得注意的有趣事情是，我們越來越多地看到其他安全公司採用 Cloudflare 作為同類最佳的解決方案。當您的同行選擇您的產品時，這是令人難以置信的肯定。一家公共安全合規供應商、一家領先的端點安全供應商和一家最大的數據安全供應商都簽署了價值超過 700,000 美元的多年期合同。甚至我們的直接競爭對手也經常將 Cloudflare 用於 DDoS 緩解和其他我們明顯領先的服務。同行對我們同類最佳產品的認可繼續驗證了為什麼我相信 Cloudflare 將在未來可能面臨的艱難經濟時期繼續發展壯大。

One last thing in the spirit of transparency before I turn it over to Thomas. We had a bug in our billing system related to how we expire unused credits for pay-as-you-go customers. Before we went public for good accounting reasons, we put in place a policy where we expired unused credits after 3 years. That system triggered for the first time earlier this year. Unfortunately, a bug in it caused our systems to report a spike in total paying customers last quarter. The revenue involved is not material, less than $160,000, and that it caused us to over-report the number of paying customers last quarter. The correct numbers are 148,184 in Q1 and 151,803 in Q2. Our pay-as-you-go business is only 11% of our revenue today, but we believe it's important to continue to invest in it in order to serve the entire market and protect our client. I'm embarrassed by the mistake, and we've fixed the bug and put in place checks designed to catch any similar errors in the future. I don't like it when we make mistakes. But I do think it's important we be transparent and own them when we do, which is why I insisted on addressing this today. It also leaves more fun topics for Thomas.

在我把它交給托馬斯之前，本著透明精神的最後一件事。我們的計費系統中存在一個錯誤，該錯誤與我們如何使現收現付客戶的未使用信用過期有關。在我們出於良好的會計原因上市之前，我們制定了一項政策，即在 3 年後到期未使用的信用。該系統於今年早些時候首次觸發。不幸的是，其中的一個錯誤導致我們的系統報告上個季度的付費客戶總數激增。所涉及的收入並不重要，不到 160,000 美元，這導致我們高估了上個季度的付費客戶數量。正確的數字是第一季度的 148,184 和第二季度的 151,803。我們的現收現付業務目前僅占我們收入的 11%，但我們認為繼續對其進行投資以服務於整個市場並保護我們的客戶非常重要。我對這個錯誤感到尷尬，我們已經修復了這個錯誤並進行了檢查，旨在在未來發現任何類似的錯誤。我不喜歡我們犯錯。但我確實認為重要的是我們保持透明並在我們這樣做時擁有它們，這就是我今天堅持解決這個問題的原因。它也為托馬斯留下了更多有趣的話題。

With that, I'll hand it off to Thomas to walk through the financials. Thomas, take it away.

有了這個，我將把它交給托馬斯來了解財務狀況。托馬斯，把它拿走。

Thank you, Matthew, and thank you to everyone for joining us. We delivered another strong quarter driven by strength in our large customers with a record number of large customer additions as we continue to build our expansion engine. Our success in the first half of this year reflects the investments in our innovation and large enterprise go-to-market initiatives as well as the benefits of operating a durable, subscription-based revenue model.

謝謝你，馬修，也感謝大家加入我們。隨著我們繼續建立我們的擴張引擎，我們在大客戶實力的推動下又迎來了一個強勁的季度，新增的大客戶數量創下歷史新高。我們今年上半年的成功反映了我們對創新和大型企業上市計劃的投資，以及運營基於訂閱的持久收入模式的好處。

Turning to revenue. Total revenue for the second quarter increased 54% year-over-year to $234.5 million. The growth in revenue was driven by strong adoption of our product portfolios and continued traction with our enterprise customer base. Area 1, the e-mail security company we acquired in April, contributed less than 1% of revenue.

轉向收入。第二季度總收入同比增長 54% 至 2.345 億美元。收入的增長是由我們產品組合的大力採用和我們的企業客戶群的持續牽引推動的。我們在 4 月份收購的電子郵件安全公司 Area 1 貢獻的收入不到 1%。

From a geographic perspective, we saw continued strength in both the U.S. and internationally. The U.S. represented 53% of revenue and increased 35% year-over-year. EMEA represented 26% of revenue and increased 54% year-over-year. APAC represented 14% of revenue and increased 43% year-over-year. We are pleased to see growth continue to accelerate in APAC.

從地理角度來看，我們看到美國和國際的持續實力。美國占收入的 53%，同比增長 35%。 EMEA 佔收入的 26%，同比增長 54%。亞太地區佔收入的 14%，同比增長 43%。我們很高興看到亞太地區的增長繼續加速。

Turning to our customer metrics. In the second quarter, we had 151,800 paying customers, representing an increase of 20% year-over-year. We saw a higher level of churn due in part to pay-as-you-go customers shifting down to our free customer tier. As our business continues to move up market, the total revenue contribution from our pay-as-you-go business which largely reflects SMB continues to decline, representing 11% of revenue in the second quarter, down from 14% in 2021 as disclosed at our Investor Day in May.

轉向我們的客戶指標。第二季度，我們擁有 151,800 名付費客戶，同比增長 20%。我們看到更高的流失率，部分原因是現收現付客戶轉移到我們的免費客戶層。隨著我們的業務繼續向市場上升，我們的現收現付業務的總收入貢獻在很大程度上反映了 SMB 繼續下降，佔第二季度收入的 11%，低於披露的 2021 年的 14%我們五月的投資者日。

Turning to large customers. We ended the quarter with 1,749 large customers, representing an increase of 61% year-over-year, and a record addition of 212 large customers in the quarter. We were pleased to see large customer revenue contribution increase again sequentially. We continue to move up market, shipping products and features that are enterprise grade, and that is reflected in our large customer cohorts consistently increasing size and revenue contribution. Significant expansion from our large customers contributed to a dollar-based net retention of 126%, representing a decrease of 100 basis points sequentially and an increase of 200 basis points year-over-year. While we expect DNR to continue to trend upward over time, we expect some variability quarter-to-quarter.

轉向大客戶。截至本季度末，我們擁有 1,749 家大客戶，同比增長 61%，本季度新增 212 家大客戶，創歷史新高。我們很高興看到大客戶收入貢獻再次環比增長。我們繼續提升市場，提供企業級的產品和功能，這反映在我們的大型客戶群不斷增加的規模和收入貢獻中。我們大客戶的顯著擴張促成了 126% 的美元淨留存率，環比下降 100 個基點，同比增長 200 個基點。雖然我們預計 DNR 將隨著時間的推移繼續呈上升趨勢，但我們預計季度間會有一些變化。

Moving to gross margin. Second quarter gross margin was 78.9%, representing an increase of 20 basis points sequentially. Network CapEx represented 13% of revenue in the second quarter. We continue to expect some level of quarter-to-quarter variability given strategic purchase decisions and continue to expect network CapEx to be 12% to 14% of revenue for fiscal 2022.

轉向毛利率。第二季度毛利率為78.9%，環比增長20個基點。網絡資本支出佔第二季度收入的 13%。鑑於戰略採購決策，我們繼續預計季度間存在一定程度的波動，並繼續預計網絡資本支出將佔 2022 財年收入的 12% 至 14%。

Turning to operating expenses. Second quarter operating expenses as a percentage of revenue increased 3% sequentially and decreased 2% year-over-year to 79%. We had another strong hiring quarter, where we saw our total number of employees increase 49% year-over-year, bringing our total number of employees to approximately 3,060 at the end of the quarter. As we look forward into the second half of 2022, we plan to slow the velocity of hiring given global macroeconomic uncertainty. We also see an opportunity to raise the bar on new higher additions given dislocations in the market.

轉向運營費用。第二季度運營費用佔收入的百分比環比增長 3%，同比下降 2% 至 79%。我們有另一個強勁的招聘季度，我們的員工總數同比增長 49%，使我們的員工總數在本季度末達到約 3,060 人。展望 2022 年下半年，鑑於全球宏觀經濟的不確定性，我們計劃放慢招聘速度。鑑於市場錯位，我們還看到了提高新增加的門檻的機會。

Sales and marketing expenses were $103.9 million for the quarter. Sales and marketing as a percentage of revenue increased 2% sequentially and decreased to 44% from 45% in the same quarter last year. Research and development expenses were $46.2 million in the quarter. R&D as a percentage of revenue increased 1% sequentially and stayed flat from 20% in the same quarter last year.

本季度的銷售和營銷費用為 1.039 億美元。銷售和營銷佔收入的百分比環比增長 2%，從去年同期的 45% 下降至 44%。本季度的研發費用為 4620 萬美元。研發佔收入的百分比環比增長 1%，與去年同期的 20% 持平。

General and administrative expenses was $35.8 million for the quarter. G&A as a percentage of revenue stayed flat sequentially and decreased to 15% from 16% in the same quarter last year. Operating loss was $891,000 compared to an operating loss of $4 million in the same period last year. Second quarter operating margin was negative 0.4%, improving 220 basis points year-over-year. If not for our acquisition and continued investment in Area 1, we would have been operating profit positive.

本季度的一般和行政費用為 3580 萬美元。 G&A 佔收入的百分比環比持平，從去年同期的 16% 降至 15%。經營虧損為 891,000 美元，而去年同期的經營虧損為 400 萬美元。第二季度營業利潤率為負 0.4%，同比提高 220 個基點。如果不是因為我們對 1 區的收購和持續投資，我們的營業利潤將是正數。

Turning to net income and the balance sheet. Our net income in the quarter was $312,000 or net income per share of $0.00. Tax expense for the quarter were $793,000. We ended the second quarter with $1.6 billion in cash, cash equivalents and available-for-sale securities. Free cash flow was negative $4.4 million in the second quarter or 2% of revenue compared to a negative $9.8 million or 6% of revenue in the same period last year. Operating cash flow was $38.3 million in the second quarter or 16% of revenue compared to $7.5 million or 5% of revenue in the same period last year.

轉向淨收入和資產負債表。我們本季度的淨收入為 312,000 美元或每股淨收入 0.00 美元。本季度的稅費為 793,000 美元。我們在第二季度結束時擁有 16 億美元的現金、現金等價物和可供出售的證券。第二季度自由現金流為負 440 萬美元，佔收入的 2%，而去年同期為負 980 萬美元，佔收入的 6%。第二季度的經營現金流為 3830 萬美元，佔收入的 16%，而去年同期為 750 萬美元，佔收入的 5%。

We will be diligent in balancing operational discipline moving forward. We have a heightened focus on free cash flow while maintaining profitability at or near breakeven with continued investment to address the enormous opportunity in front of us. As mentioned in prior quarters, we continue to expect to return to positive free cash flow in the second half of 2022. Remaining performance obligations, or RPO, came in at $760 million, representing an increase of 10% sequentially and 57% year-over-year. Current RPO was 76% of total RPO.

我們將努力平衡向前發展的運營紀律。我們更加關注自由現金流，同時通過持續投資以應對擺在我們面前的巨大機遇，將盈利能力保持在或接近盈虧平衡點。如前幾個季度所述，我們繼續預計 2022 年下半年將恢復正的自由現金流。剩餘履約義務或 RPO 為 7.6 億美元，環比增長 10%，同比增長 57% -年。當前的 RPO 是總 RPO 的 76%。

Before we move to guidance for the third quarter and full year, I would like to provide additional color on our expectations in light of the uncertainty in the macroeconomic environment. Similar to the early days of COVID, we performed rigorous analysis to understand both the risks and opportunities in the current environment. However, while COVID particularly affected a narrow set of industries, the current challenges impact a broader set of verticals, which is why we believe it's important for us to be more prudent in this quarter's guidance.

在我們轉向第三季度和全年的指導之前，鑑於宏觀經濟環境的不確定性，我想為我們的預期提供額外的色彩。與 COVID 的早期類似，我們進行了嚴格的分析，以了解當前環境中的風險和機遇。然而，雖然 COVID 特別影響了一小部分行業，但當前的挑戰影響了更廣泛的垂直行業，這就是為什麼我們認為在本季度的指導中更加謹慎對我們來說很重要。

Headwinds from foreign exchange have also accelerated. And with our product portfolio priced in U.S. dollars, our products are becoming more expensive internationally. And while we haven't seen a material change in our customers' behavior to date, we are seeing elongated sales cycles at the high end of our business. We are cognizant of the increasingly cautious environment and have factored this into our outlook.

來自外彙的逆風也加速了。由於我們的產品組合以美元定價，我們的產品在國際上變得越來越貴。雖然迄今為止我們還沒有看到客戶行為發生重大變化，但我們看到高端業務的銷售週期延長了。我們認識到日益謹慎的環境，並將其納入我們的前景。

For the third quarter, we expect revenue in the range of $250 million to $251 million, representing an increase of 45% to 46% year-over-year. We expect operating income in the range of $0 million to $1 million. We expect net income per share of breakeven to $0.01, assuming approximately 342 million common shares outstanding. We expect a tax expense of $1.9 million. For the full year 2022, we expect revenue in the range of $968 million to $972 million, representing an increase of 47% to 48% year-over-year. We expect operating income for the full year in the range of $7 million to $11 million. We expect net income per share over that period in the range of $0.03 to $0.04, assuming approximately 343 million common shares outstanding. We expect a tax expense of $6.4 million.

對於第三季度，我們預計收入在 2.5 億美元至 2.51 億美元之間，同比增長 45% 至 46%。我們預計營業收入在 000 萬美元到 100 萬美元之間。假設大約有 3.42 億股流通在外的普通股，我們預計盈虧平衡的每股淨收入為 0.01 美元。我們預計稅費為 190 萬美元。對於 2022 年全年，我們預計收入在 9.68 億美元至 9.72 億美元之間，同比增長 47% 至 48%。我們預計全年營業收入在 700 萬美元至 1100 萬美元之間。假設大約有 3.43 億股流通在外的普通股，我們預計該期間的每股淨收入在 0.03 美元至 0.04 美元之間。我們預計稅費為 640 萬美元。

We are fortunate to be uniquely positioned as a provider of mission-critical services to our customers. And while there are challenges in the economy, we remain excited about the opportunity in front of us. We'd like to thank the Cloudflare employees for their continued dedication and resiliency in delivering exceptional service to our customers, partners and communities.

我們很幸運能夠為我們的客戶提供關鍵任務服務的獨特定位。儘管經濟面臨挑戰，但我們仍然對擺在我們面前的機會感到興奮。我們要感謝 Cloudflare 員工在為我們的客戶、合作夥伴和社區提供卓越服務方面的持續奉獻和彈性。

And with that, I'd like to open it up for questions. Operator, please pull for questions.

有了這個，我想打開它來提問。接線員，請拉問題。

(Operator Instructions) Your first question comes from the line of Matt Hedberg with RBC Capital Markets.

（操作員說明）您的第一個問題來自 RBC Capital Markets 的 Matt Hedberg。

Great. Congrats on the results in a tough environment. Maybe Thomas, for you, Matthew had a lot of helpful commentary, and I think we appreciate the candor. You mentioned longer sales cycles, but you still increased your full year guide by $13 million or more than the $7 million Q2 beat. Can you talk a little bit more about specifically how you thought about levels, embedding levels of conservatism? And are you assuming things kind of stay the same or maybe gets worse from here?

偉大的。祝賀在艱難的環境中取得的成果。也許托馬斯，對你來說，馬修有很多有用的評論，我認為我們很欣賞他的坦率。你提到了更長的銷售週期，但你仍然將全年指南增加了 1300 萬美元，或者超過了第二季度的 700 萬美元。你能具體談談你是如何看待層次的，嵌入保守主義的層次嗎？你是在假設事情保持不變還是從這裡變得更糟？

Yes. We looked at a lot of different factors impacting guidance this year, and you picked up some already. So we continue to see elongated sales cycles at the high end of our business, that is especially in the $0.5 million to $1 million bucket, and we expect that to continue.

是的。我們研究了今年影響指導的許多不同因素，您已經了解了一些。因此，我們繼續看到我們業務高端的銷售週期延長，特別是在 50 萬美元到 100 萬美元之間，我們預計這種情況會持續下去。

We saw also that our European business was the second best-performing region this quarter, and we've seen deterioration of performance, especially in Europe over the first and second quarter. So we expect that the trend, for sure, not to improve. We also see across the board, I think that companies are, like us, becoming more cautious in how they approach the business and things that are discussed twice in order to make sure that, that has only been done once. So we have not factored in our guidance that things would improve from here on moving forward, and perform rigorous analysis across verticals, across various regions and customer cohorts. And that's why you see a more prudent and more cautious guide for the third quarter and the end of the year.

我們還看到，我們的歐洲業務是本季度表現第二好的地區，我們已經看到業績惡化，尤其是在第一季度和第二季度的歐洲。因此，我們預計這種趨勢肯定不會改善。我們還全面看到，我認為公司和我們一樣，在處理業務和討論兩次的事情上變得更加謹慎，以確保只做過一次。因此，我們沒有將我們的指導考慮在內，即從這裡開始情況會有所改善，並對垂直領域、不同地區和客戶群進行嚴格的分析。這就是為什麼您會看到第三季度和年底的指南更加謹慎和謹慎。

Got it. That makes sense. And then maybe just one for Matthew. The wins that you called out in Workers are exciting. I guess I'm wondering, is there an opportunity in maybe more challenged economic times for customers to start to use Workers in even more creative and maybe cost-effective higher ROI ways than they would have otherwise done so, if like you said, the road was kind of clear ahead and no clouds or fog in front of us?

知道了。那講得通。然後也許只有一個給馬修。你在 Workers 中宣布的勝利是令人興奮的。我想我想知道，在可能更具挑戰性的經濟時代，是否有機會讓客戶開始以更具創造性和成本效益的更高投資回報率的方式使用 Workers，如果像你說的那樣，前面的路很乾淨，前面沒有云霧？

Yes. I think one of the really powerful things about Workers is its efficiency. And so a workload, an equivalent workload running on Workers versus running on any of the sort of traditional public clouds, the AWSs, or Google Cloud or Microsoft Azure, is typically significantly less expensive to run. And the technical work in order to make that happen is part of the magic of what Workers delivers. And so we are definitely seeing especially in either new startups or people who are really realizing that they've got to make money go further.

是的。我認為 Workers 真正強大的地方之一是它的效率。因此，工作負載，即在 Workers 上運行的等效工作負載與在任何一種傳統公共雲、AWS、谷歌云或 Microsoft Azure 上運行的工作負載相比，通常運行成本要低得多。為實現這一目標而進行的技術工作是 Workers 提供的魔法的一部分。因此，我們肯定會看到，尤其是在新的初創公司或真正意識到他們必須賺錢的人中走得更遠。

The days of just wildly spending on your cloud bill, I think, are behind us. And there are many different ways, both with Workers as well as just some of our standard products, that if you put us in front of your typical public cloud, we can often save you quite a bit of money. And so again, I think that, that was a message that didn't really resonate very much a year ago, where everyone was just -- it seemed my money was free and people were throwing it at any problem that was out there. But I think in these particular environments where people are trying to figure out how to stretch a dollar even further, Workers and Cloudflare's platform as a whole is very effective at helping people save money.

我認為，在雲賬單上大肆消費的日子已經過去了。並且有許多不同的方式，無論是使用 Workers 還是我們的一些標準產品，如果你把我們放在你典型的公共雲前面，我們通常可以為你節省很多錢。再說一次，我認為，這是一個在一年前並沒有真正引起共鳴的信息，當時每個人都只是 - 似乎我的錢是免費的，人們把它扔在外面的任何問題上。但我認為，在人們試圖弄清楚如何進一步利用美元的特定環境中，Workers 和 Cloudflare 的整個平台在幫助人們省錢方面非常有效。

Your next question comes from the line of James Fish with Piper Sandler.

您的下一個問題來自 James Fish 和 Piper Sandler 的台詞。

Actually, intra-quarter was an interesting release from you guys that you talked about the Cloudflare One partner, program and Matthew in your prepared remarks, you mentioned taking some of your competitors top channel partners. Can you go over some of the details that you expect in terms of how this program is going to work for you guys? Is it solely focused on security? And how this is going to impact your indirect mix and profitability over the next couple of years?

實際上，你們在準備好的評論中談到了 Cloudflare One 合作夥伴、計劃和 Matthew，你們提到了讓一些競爭對手成為頂級渠道合作夥伴。您能否詳細介紹一下您對該計劃將如何為你們工作的期望？它只關注安全嗎？這將如何影響您未來幾年的間接組合和盈利能力？

Yes. I think that from the early days of Cloudflare, we explored various partner programs. And the challenge was that for a lot of our early products took 5 minutes to sign up, and they just worked out of the box, and so there wasn't a lot of value to add as a value-added reseller. And so while we had what I would call fairly standard success for the SaaS industry in working with partners. I don't think our products really facilitated getting the most out of the partner ecosystem. And especially, if all a partner is an order taker, then that's not a lot of value.

是的。我認為從 Cloudflare 的早期開始，我們就探索了各種合作夥伴計劃。挑戰在於，我們的許多早期產品都需要 5 分鐘才能註冊，而且它們只是開箱即用，因此作為增值經銷商沒有太多價值可以增加。因此，儘管我們在與合作夥伴合作方面取得了我稱之為 SaaS 行業相當標準的成功。我認為我們的產品並沒有真正促進充分利用合作夥伴生態系統。尤其是，如果所有合作夥伴都是訂單接受者，那麼這並不是很有價值。

I think a handful of things have happened. One is that our products have gotten more complicated, and the ability to customize them in various ways has become much richer. So for example, with Workers, what we're seeing from a partner like IBM is that they can actually develop their own intellectual property for a particular industry vertical. Deploy, that on Workers and then sell that same IP over and over again. That's great for them. It really drives their services revenue, and it's great for us because it means that we are getting more leverage in what we're able to deliver through partners.

我認為發生了一些事情。一是我們的產品越來越複雜，各種定制能力也越來越豐富。例如，對於 Workers，我們從像 IBM 這樣的合作夥伴那裡看到的是，他們實際上可以為特定的垂直行業開發自己的知識產權。將其部署在 Workers 上，然後一遍又一遍地出售相同的 IP。這對他們來說很棒。這確實推動了他們的服務收入，這對我們來說非常好，因為這意味著我們在通過合作夥伴提供的服務方面獲得了更多的影響力。

The second thing is that I think we saw with Zscaler that their success with a handful of partners in selling Zero Trust products was really successful. Those products take more work to actually implement and deploy within an organization. It's not a 5-minute setup. And so in that case, that's an area where we are able to work with partners. And in particular, we're very much following the playbook. And when we talk to the partners that are selling Zero Trust services, they all want to have more solutions in their basket to be able to bring to customers. Because in a lot of cases, the kind of previous Zero Trust solution either suffered from a lack of ability to scale, real performance bottlenecks, not having the total global coverage that global companies need, and Cloudflare addresses all of those things extremely well. So I think that, that's an opportunity for us.

第二件事是，我認為我們在 Zscaler 中看到了他們與少數合作夥伴在銷售零信任產品方面的成功非常成功。這些產品需要更多的工作才能在組織內實際實施和部署。這不是 5 分鐘的設置。因此，在這種情況下，這是我們能夠與合作夥伴合作的領域。特別是，我們非常遵循劇本。當我們與銷售零信任服務的合作夥伴交談時，他們都希望在他們的購物籃中有更多的解決方案能夠帶給客戶。因為在很多情況下，以前的零信任解決方案要么缺乏擴展能力、真正的性能瓶頸，要么沒有全球公司需要的全球覆蓋範圍，而 Cloudflare 非常好地解決了所有這些問題。所以我認為，這對我們來說是一個機會。

In terms of profitability, I think the good news is that these more complex products tend to actually be the highest margin products that we have. And so as we were designing the program, we thought that we could have it be both margin accretive to Cloudflare while also still being very attractive to the potential partners that are bringing that to market. And so I think that this is an area that we're watching very carefully. I think it's a part that is -- we're going to continue to invest in. It actually is also one of the hidden benefits of us acquiring Area 1 is they had a lot more experience with the channel and with partners. And so working with the team there to really design that program has been great, and the reception from partners has been terrific. So I think it's a win-win for us and for our partners.

就盈利能力而言，我認為好消息是這些更複雜的產品實際上往往是我們擁有的利潤率最高的產品。因此，在我們設計該計劃時，我們認為我們可以讓它既能為 Cloudflare 增加利潤，同時也對將其推向市場的潛在合作夥伴仍然非常有吸引力。所以我認為這是一個我們正在非常仔細觀察的領域。我認為這是我們將繼續投資的一部分。實際上，這也是我們收購 Area 1 的隱藏好處之一，因為他們在渠道和合作夥伴方面擁有更多經驗。因此，與那裡的團隊一起真正設計該程序非常棒，合作夥伴的接待也非常好。所以我認為這對我們和我們的合作夥伴都是雙贏的。

Very helpful, Matthew. Last one for me there is a big government quarter coming up here. And obviously, you guys have just some integrated relationship. I guess what are you seeing on the government agency side and that FedRAMP program?

非常有幫助，馬修。最後一個對我來說，這裡有一個很大的政府區。很明顯，你們只是有一些整合的關係。我猜你在政府機構和 FedRAMP 計劃方面看到了什麼？

Yes. I appreciate it. We are -- it's like being in line with the DMV. The -- we've pulled our number and are just waiting for it to come up for us to get our FedRAMP certification. And so we expect that we'll have very positive news for that next quarter. But we're basically at number -- we're #84 and it's showing #83 on the sort of red number accounting board at the DMV.

是的。我很感激。我們是 - 這就像與 DMV 保持一致。 - 我們已經提取了我們的號碼，正在等待它出現，以便我們獲得 FedRAMP 認證。因此，我們預計下個季度會有非常積極的消息。但我們基本上是數字——我們是#84，它在DMV的紅色數字會計板上顯示#83。

So that's positive. We see across the board, not just with federal, but the example that I gave in the State of Arizona, we're seeing a lot more people adopt Cloudflare services in that government space. And so I think that, that continues to be a place where we have very strong relationships. And as we continue to get the various certifications, it will allow us to go even faster.

所以這是積極的。我們全面看到，不僅僅是聯邦政府，還有我在亞利桑那州給出的例子，我們看到越來越多的人在該政府領域採用 Cloudflare 服務。所以我認為，這仍然是一個我們擁有非常牢固關係的地方。隨著我們繼續獲得各種認證，這將使我們走得更快。

Your next question comes from the line of Alex Henderson with Needham & Co.

你的下一個問題來自於李約瑟公司的 Alex Henderson。

I was hoping that you could talk a little bit about the context of the commentary around economic conditions. It's pretty obvious to the entire planet, the economies globally are decelerating. And particularly, Europe is under a lot of duress. But your initial comments was sort of that you saw that start to really manifest in 1Q and then it actually improved somewhat or at least stabilized in 2Q, yet you sound a lot more cautious on your thought process and so forth. And I'm wondering if there's a little bit of a disconnect between those 2, the tone of those 2. It doesn't sound like your business has rolled at all and sequentially gotten worse or more tense. But on the other side of the coin, you sound like you're being much more conservative in your outlook. So can you parse between those 2 a little bit?

我希望你能談談有關經濟狀況的評論的背景。整個地球都很明顯，全球經濟正在減速。特別是，歐洲受到了很大的脅迫。但你最初的評論有點像你看到第一季度開始真正表現出來，然後在第二季度實際上有所改善或至少穩定下來，但你在思考過程等方面聽起來更加謹慎。而且我想知道這兩個之間是否有一點脫節，這兩個的基調。聽起來你的業務根本沒有滾動並且順序變得更糟或更緊張。但在硬幣的另一面，你聽起來好像你的前景更加保守。那麼你能在這兩者之間稍微解析一下嗎？

Yes, Alex. Yes, I think that. What we see is that the environment has gotten harder. And I think we saw the first signals of that actually going back to December of 2021, and they really started to manifest in various ways, slowdown of pipeline slowdown of customers paying their bills in Q1 of this year. And we talked about that on the last quarter earnings call. And I think some people were questioning why would we do that?

是的，亞歷克斯。是的，我認為。我們看到的是環境變得更加艱難。我認為我們看到的第一個信號實際上可以追溯到 2021 年 12 月，它們確實開始以各種方式表現出來，今年第一季度客戶支付賬單的管道放緩。我們在上一季度的財報電話會議上談到了這一點。我想有些人會質疑我們為什麼要這樣做？

What I think we've been able to do, though, because we saw that, we acknowledged it. We didn't pretend like everything was normal, was really a just to take advantage of the situation. And so I think one of the real powers of Cloudflare's business is the diversity of our customer sets, both on a geography and also industry basis, the diversity of our products, and that allows us to have multiple levers to be able to continue to deliver even when the times get tough.

不過，我認為我們已經能夠做到，因為我們看到了這一點，我們承認了這一點。我們沒有假裝一切正常，真的只是為了利用這種情況。所以我認為 Cloudflare 業務的真正力量之一是我們客戶群的多樣性，無論是在地理上還是在行業基礎上，我們產品的多樣性，這使我們能夠擁有多個槓桿來繼續交付即使時代變得艱難。

And I think if you go back to the COVID quarters, and that was definitely a time where we had to adjust how we went to market, what we did, what types of customers we focused on. We really transitioned from being a business-driven primarily from getting new logos to one that developed a real expertise in how to go to our existing customers and sell them more. And I think there are a lot of analogies that are similar to the sort of adjustments that we've made that allowed us to have a quarter like this.

而且我認為，如果您回到 COVID 季度，那絕對是我們必須調整進入市場的方式、我們所做的事情以及我們關注的客戶類型的時候。我們真的從一個主要從獲得新標誌的業務驅動轉變為一個真正的專業知識，如何去接觸我們現有的客戶並銷售他們更多。而且我認為有很多類比類似於我們所做的調整，使我們能夠擁有這樣的季度。

But make no mistake, we're still in what my grandmother would call a tule fog, we've still got to go out and do the work every day of filling up the wheelbarrow with new leads, sifting through it to look for what's going to be the most promising and being able to deliver. But what I like about our business is, again, its diversity across customer types, customer sizes, products, ways that we can go to market. And I think our team has done a good job of adapting to what is a much more difficult situation today than it was a year ago.

但別搞錯了，我們仍然處於我祖母所說的圖勒霧中，我們仍然必須每天出去做工作，用新的線索裝滿獨輪車，篩選它以尋找發生了什麼成為最有前途並能夠交付的人。但我喜歡我們業務的一點，還是它在客戶類型、客戶規模、產品以及我們進入市場的方式方面的多樣性。而且我認為我們的團隊在適應今天比一年前更加困難的情況方面做得很好。

Alex, maybe one additional point. I pointed that out in my script, but -- and I didn't mention it in the previous answer. What we do feel is our also currency headwinds, especially in Europe. So even if the economic activity for us in terms of deal volume would be the same we see the headwinds from a currency perspective in Europe, but also in other parts of the world, Japan, for example, that we need to digest.

亞歷克斯，也許還有一點。我在我的腳本中指出了這一點，但是 - 我在上一個答案中沒有提到它。我們確實感覺到我們的貨幣逆風，尤其是在歐洲。因此，即使我們在交易量方面的經濟活動是相同的，但從貨幣的角度來看，我們在歐洲看到了不利因素，但在世界其他地區，例如日本，我們也需要消化這些不利因素。

Yes. That actually leads me to the second question that I wanted to ask is the European environment is particularly onerous with 20% currency translation headwinds in EMEA or inflation, rising interest rates, think of England just raise rates 0.5% today in fact. And given that environment, they're struggling with huge price increases, particularly on systems in local -- in dollars plus the currency translation and their budgets are fairly flat.

是的。這實際上使我想到了我想問的第二個問題，即歐洲環境特別繁重，歐洲、中東和非洲地區存在 20% 的貨幣換算逆風或通貨膨脹、利率上升，想想英國今天實際上只加息 0.5%。鑑於這種環境，他們正在努力應對巨大的價格上漲，特別是在本地系統上——以美元加上貨幣換算，他們的預算相當平坦。

Now my understanding is there seems to be a separation between companies that are selling relatively low-priced/high-value technologies and companies are selling high-ticket technologies. Can you talk about whether you're aggressively low priced? And the fact that you're a lower ticket upfront gives you a big advantage in that geography because of that characteristic and whether you're seeing more pressure on the higher value with the higher, bigger ticket transactions? Because I think ultimately, that seems to be the dividing rod between who wins and loses in Europe.

現在我的理解是，銷售相對低價/高價值技術的公司與銷售高價技術的公司之間似乎存在差異。你能談談你的價格是否過低嗎？並且由於該特徵，您的前期票價較低這一事實為您在該地區提供了很大的優勢，並且您是否看到更高價值的更高價值的壓力更大，更大的門票交易？因為我認為最終，這似乎是歐洲勝負之間的分水嶺。

Well, I think it's certainly a benefit that our products are mission-critical. But even then, in the high end and bigger ACV deals, decision takes longer. That's where you see the elongated sales cycles.

嗯，我認為我們的產品是關鍵任務當然是一個好處。但即便如此，在高端和更大的 ACV 交易中，決策需要更長的時間。這就是您看到延長的銷售週期的地方。

The second factor in our favor is that gross margin is one of the strong points of the business model. When we deploy that web and we always talked a bit audit it as a strategic weapon where it makes sense. So that doesn't mean price cutting. We try to be strategic and accommodating where we think it makes sense to build business relationship and business but we're using our margin to accommodate for that without any doubt.

對我們有利的第二個因素是毛利率是商業模式的優勢之一。當我們部署該網絡時，我們總是談論將其作為有意義的戰略武器進行審核。所以這並不意味著降價。我們試圖在我們認為建立業務關係和業務有意義的地方保持戰略性和包容性，但毫無疑問，我們正在利用我們的利潤來適應這種情況。

Your next question comes from the line of Shaul Eyal with Cowen.

您的下一個問題來自與 Cowen 的 Shaul Eyal。

Congrats on a set of results. Matthew, the first question for you. So lots of discussions throughout the quarter, maybe some chatter around your crypto exposure potential implications. Maybe a good opportunity here to address Cloudflare's exposure, maybe current thinking on this vertical, given the changing dynamics we've seen in recent months.

恭喜一組結果。馬修，你的第一個問題。整個季度有很多討論，也許是圍繞你的加密暴露潛在影響的一些討論。考慮到我們最近幾個月看到的不斷變化的動態，這可能是一個解決 Cloudflare 曝光率的好機會，也可能是當前對這一垂直領域的思考。

Sure. I mean, I think that we have customers that are in that space, including a number of the large exchanges. But I don't think that there are any of them, that would crack being a top-10 customer. And I think as a whole, I don't know the exact exposure, Thomas will may be able to add to it. But I will say that it's not significant enough that it has been brought up as a big risk item internally.

當然。我的意思是，我認為我們在那個領域有客戶，包括一些大型交易所。但我不認為其中有任何一個會成為前 10 名客戶。而且我認為作為一個整體，我不知道確切的曝光，Thomas 可能會添加它。但我要說的是，它還不夠重要，以至於在內部被作為一個大風險項目提出來。

So I think that we have always had -- I mean, I personally have never -- there's a lot of religion around the crypto space, where people are either hyperly pro crypto or hyperly against crypto. I feel like I'm the only kind of agnostic on crypto, where I don't think we have bet heavily on it. But at the same time, we would definitely make sure that if there are things that emerge from it, that we're in a position to take advantage of those. But that has not been a meaningful headwind to us.

所以我認為我們一直都有——我的意思是，我個人從來沒有——圍繞加密貨幣領域有很多宗教信仰，人們要么極度支持加密貨幣，要么極度反對加密貨幣。我覺得我是唯一對加密貨幣不可知論者，我認為我們並沒有在它上面下重註。但與此同時，我們肯定會確保，如果其中出現了一些東西，我們能夠利用這些東西。但這對我們來說並不是一個有意義的逆風。

Yes. And maybe some color. Our exposure to crypto was less than was single -- mid-single digits in percent of revenue, up under 5% for the second quarter. And so not a big -- an interesting part in terms of the size and the amount of customers but not a big exposure to revenue.

是的。也許還有一些顏色。我們對加密貨幣的敞口低於單一——佔收入百分比的中個位數，第二季度增長不到 5%。所以不是很大——就客戶的規模和數量而言，這是一個有趣的部分，但對收入的影響並不大。

Understood. And Thomas, maybe one for you, a question on elongated sales cycle. I know it's a bit tricky it differs from customer to customer. But maybe can you generalize for us how long -- how much are these cycles being elongated? Are we talking 2 weeks, 3 weeks, more than that? How could we be thinking about it? The world elevated is a very, very general term.

明白了。托馬斯，也許是給你的一個，關於延長銷售週期的問題。我知道這有點棘手，它因客戶而異。但也許你能為我們概括多長時間 - 這些週期被拉長了多少？我們是在談論 2 週、3 週還是更多？我們怎麼能想到呢？世界提升是一個非常非常籠統的術語。

Well, I would say for the main part of our business, we are still far below 90 days from a pure cycle perspective. So when we talk about elongated sales cycles, it's in the upper end of our cohorts where you look at the bucket, $500,000 to $1 million of ACV where it's moving out. But there, it's moving out by weeks, not by days.

好吧，我想說，對於我們業務的主要部分，從純週期的角度來看，我們仍然遠低於 90 天。因此，當我們談論延長的銷售週期時，您會看到我們的同類產品的高端，500,000 到 100 萬美元的 ACV 正在移出。但是在那裡，它是按周而不是按天移動的。

(Operator Instructions) Your next question comes from the line of Fatima Boolani with Citi.

（操作員說明）您的下一個問題來自花旗銀行的 Fatima Boolani。

Matthew or Thomas, jump all for either one of you. Thinking about the shift to pay as you go customers, some of your observations and commentary around elongating deal cycles that you just addressed. I'm curious if you can just sort of take a step back and bifurcate for us how new logo land purchasing and procurement behavior has changed versus expansion or installed base expansion customer behavior has changed over the last 3 months? And maybe if you can help contextualize this or put this under the lens of your product pillars whether there is more or less usage or slower adoption of certain pillars versus others and certainly against the hardware supply chain constraint backdrop that we're in right now?

馬修或託馬斯，為你們中的任何一個而全力以赴。考慮一下向客戶付款的轉變，關於您剛剛解決的延長交易週期的一些觀察和評論。我很好奇你是否可以退後一步，為我們分叉新標誌土地購買和採購行為與擴張或安裝基礎擴張客戶行為在過去 3 個月中的變化？也許您可以幫助您將其背景化或將其置於您的產品支柱的鏡頭下，與其他支柱相比，某些支柱的使用或多或少或採用較慢，當然還有我們現在所處的硬件供應鏈限制背景？

Sure. So as I said in the prepared remarks, I think that it has gotten harder to sign up a new logo since the beginning of the year, but it's actually gotten easier to talk to our existing customers about using more of their platform -- more of our platforms in order to solve the problems that they have. And so I think that, that where we benefit is because we have such a broad product portfolio that allows us even in these times where signing up new logos is hard, we can go to our existing customers and have a conversation about how we can simplify their IT stack, how we can save them money, how we can make them more secure. And I think that, that's attractive.

當然。因此，正如我在準備好的評論中所說，我認為自今年年初以來註冊新徽標變得更加困難，但實際上與我們現有客戶談論使用更多他們的平台變得更容易 - 更多我們的平台，以解決他們遇到的問題。所以我認為，我們受益的地方是因為我們擁有如此廣泛的產品組合，即使在很難註冊新徽標的時代，我們也可以與現有客戶進行對話，討論如何簡化他們的 IT 堆棧，我們如何為他們省錢，如何讓他們更安全。我認為，這很有吸引力。

So we're still signing up plenty of new logos. But I think that on balance, it has definitely gotten harder to sign up new logos and it has gotten easier to have conversations about expanding usage of our platform and especially adopting different products that are part of our platform.

因此，我們仍在註冊大量新徽標。但我認為，總的來說，註冊新徽標肯定變得更加困難，並且更容易就擴大我們平台的使用進行對話，特別是採用我們平台中的不同產品。

In terms of what products are or how the mix of products is changing, I think security continues to be top of mind that I think that there was real kind of concern around when the Russian invasion of Ukraine happened that there would be attacks that went out from Russia in retaliation against Western companies. That actually did not materialize in Q1, the way I think a lot of people thought it would. But we started to see more of that start to materialize in Q2. It's still -- I wouldn't call it a trend yet, but we're seeing more companies come under attack and turning to us when that happens. And so I think this is an environment where security products do very well. And across our security portfolio, we're seeing strength.

就產品是什麼或產品組合如何變化而言，我認為安全仍然是首要考慮因素，我認為當俄羅斯入侵烏克蘭發生時，人們確實擔心會發生襲擊來自俄羅斯以報復西方公司。這實際上並沒有像很多人認為的那樣在第一季度實現。但我們開始看到更多的開始在第二季度實現。它仍然 - 我不會稱之為趨勢，但我們看到越來越多的公司受到攻擊並在發生這種情況時轉向我們。所以我認為這是一個安全產品做得很好的環境。在我們的安全產品組合中，我們看到了實力。

Your next question comes from the line of Joel Fishbein with Truist.

您的下一個問題來自 Joel Fishbein 與 Truist 的對話。

Matthew, at Analyst Day, you talked about acts in these large markets that Cloudflare is to go after, notwithstanding the macro environment, current macro environment. Is there anything that has changed in your philosophy about these big markets? And maybe you can just give us an update on these acts or large markets and where you're positioned maybe specifically around R2 and the big data that you have going on right now?

Matthew，在分析師日，您談到了 Cloudflare 將在這些大型市場中採取的行動，儘管存在宏觀環境和當前的宏觀環境。你對這些大市場的理念有什麼改變嗎？也許您可以向我們提供有關這些行為或大型市場的最新信息，以及您的定位可能特別是圍繞 R2 和您現在正在進行的大數據？

Yes. So we think of Cloudflare as stacking multiple adoption S curves on behind another, and so our first act were how do we protect the infrastructure of customers around the world. And it is incredible to see how we've been able to do that successfully where today, more than 20% of all websites use our infrastructure.

是的。因此，我們認為 Cloudflare 將多個採用 S 曲線疊加在另一個之後，因此我們的第一步是如何保護全球客戶的基礎設施。令人難以置信的是，看到我們如何能夠成功地做到這一點，今天，超過 20% 的網站使用我們的基礎設施。

We're continuing to sell those products, but I think that where we are earlier in that S curve is with our Zero Trust products, and we're able to go to all of those people who had adopted our application security products and now say, "Hey, we can help you with Zero Trust as well." And I think that, that is the big act that we're focusing on right now.

我們將繼續銷售這些產品，但我認為我們在 S 曲線中較早的位置是我們的零信任產品，我們能夠接觸到所有採用我們應用程序安全產品的人，現在說, “嘿，我們也可以幫助您實現零信任。”我認為，這就是我們現在關注的大動作。

Act 3 for us, which I think will really start to hit in a material way around revenue in 3 to 5 years is really around Workers, and I think we have been very pleasantly surprised how that adoption has happened faster and sooner and earlier than we expected. R2, which is our object store and our Amazon S3 competitor went into public beta last quarter, and we expect that it will go into GA right at the end of Q3. And so I think that, that's an opportunity for us to do more and we continue to invest in it. And again, we think that the real durable nature of Cloudflare is that we're able to continue to stack these acts one behind another behind another.

對我們來說，第 3 幕，我認為這將在 3 到 5 年內真正開始對收入產生實質性影響，這真的是圍繞工人，我認為我們非常驚喜地發現這種採用比我們更快、更早、更早地發生了預期的。 R2 是我們的對象存儲和我們的 Amazon S3 競爭對手，上個季度進入了公開測試版，我們預計它將在第三季度末進入 GA。所以我認為，這是我們做更多事情的機會，我們會繼續投資。再一次，我們認為 Cloudflare 真正持久的特性是我們能夠繼續將這些行為一個接一個地堆疊起來。

Your next question comes from the line of Hamza Fodderwala with Morgan Stanley.

您的下一個問題來自摩根士丹利的 Hamza Fodderwala。

Matthew, maybe a question on the security angle for you. You talked a lot about having larger platform conversations with your existing customers. Can you comment on when you talk to CIOs, CISOs at these customers, what is their willingness to really want to transform and modernize their existing security architectures versus perhaps continuing to refresh their existing on-premise date?

馬修，也許是關於安全角度的問題。您談了很多關於與現有客戶進行更大的平台對話的內容。當您與這些客戶的首席信息官、首席信息安全官交談時，您能否評論一下，與可能繼續更新其現有的內部部署日期相比，他們真正想要轉變和現代化其現有安全架構的意願是什麼？

Yes. I mean I think Morgan Stanley is a great Cloudflare customer, and we have a terrific relationship with the CIO team over there, and it's definitely an organization that has been willing to embrace change. And we -- I think that that's a big piece. And I think that most organizations today understand that they have to make that change, and they're very willing to have that conversation.

是的。我的意思是，我認為摩根士丹利是 Cloudflare 的一個很好的客戶，我們與那裡的 CIO 團隊有著非常好的關係，而且它絕對是一個願意接受變革的組織。我們 - 我認為這是一個很大的部分。而且我認為今天的大多數組織都明白他們必須做出改變，他們非常願意進行這種對話。

I think the thing that has changed to some extent is even those organizations that thought they could continue to invest in on-premise hardware are finding the current situation very difficult, where if you want to get a new firewall today, the lead times can be 9 months before you get it. And at the same time, the firewall vendors are raising their prices.

我認為在某種程度上發生了變化的是，即使是那些認為他們可以繼續投資於本地硬件的組織也發現目前的情況非常困難，如果你今天想獲得一個新的防火牆，交貨時間可以是9個月前你得到它。與此同時，防火牆廠商也在提高價格。

And so I think that a lot of -- in the results, a lot of the sort of that RPO you saw in the traditional firewall vendors was people basically holding their place in line. But it's not a way to make customers happy, telling them they have to pay more and then delaying when the product is going to be there. And so even for some of the organizations that traditionally had said, "We don't believe in the cloud or we don't believe in moving in this direction," I think that, that tune is starting to change, and it's becoming very much the minority opinion that you can solve these problems with on-premise hardware.

所以我認為，在結果中，很多你在傳統防火牆供應商中看到的那種 RPO 基本上是人們堅持自己的位置。但這並不是讓客戶滿意的方法，告訴他們必須支付更多費用，然後推遲產品的上市時間。因此，即使對於一些傳統上說過“我們不相信雲或我們不相信朝這個方向發展”的組織來說，我認為這種調子已經開始改變，而且變得非常少數人認為您可以使用本地硬件解決這些問題。

Your next question comes from the line of Adam Borg with Stifel.

您的下一個問題來自 Adam Borg 和 Stifel。

Maybe just for Thomas, I think you talked in the script about being more judicious and slowing hiring in the back half of the year. And maybe I was hoping you could talk a little bit more about which areas are still prioritized in terms of hiring and which ones you're kind of slowing a bit more?

也許只是為了托馬斯，我認為你在劇本中談到了在下半年更加明智和放緩招聘。也許我希望你能多談談哪些領域在招聘方面仍是優先考慮的領域，哪些領域你會放慢一點？

Yes. So we pulled quite a bit employee headcount wise in the second quarter. We said we take the velocity down quite a bit. And we still prioritize go-to-market open positions and protecting people moving into the second half. So the slowdown is in G&A and some of their R&D functions, but go-to-market is still going to continue to hire.

是的。因此，我們在第二季度明智地減少了員工人數。我們說我們將速度降低了很多。我們仍然優先考慮進入市場的未平倉頭寸並保護進入下半年的人們。所以放緩是在 G&A 和他們的一些研發職能部門，但進入市場仍將繼續招聘。

Your next question comes from the line of Andrew Nowinski with Wells Fargo.

您的下一個問題來自富國銀行的 Andrew Nowinski。

Great. Maybe just follow-up question on the operating income for the year. Your loss in Q2 is actually better than your guidance. I think you just said you're slowing hiring in the second half of the year. So I assume the reason you lowered your operating income for the full year fiscal '22 was due to the Area 1 acquisition. And if so, could you just pull that out? Maybe tell us what your organic revenue and operating income would have been outside of that acquisition?

偉大的。也許只是關於當年營業收入的後續問題。您在第二季度的損失實際上比您的指導要好。我想你剛才說你在下半年放緩招聘。因此，我認為您降低 22 財年全年營業收入的原因是收購了 1 區。如果是這樣，你能把它拉出來嗎？也許告訴我們你的有機收入和營業收入在收購之外會有多少？

Yes. I don't want to give more -- much more specific than the color we gave on our -- in our script. But it is true with a couple of moving parts without the continued investment in Area 1, we would have been operating margin positive probably more in the single-digit/mid-digit million range for the second quarter.

是的。我不想在我們的腳本中提供更多——比我們給我們的顏色更具體的內容。但是，如果沒有對區域 1 的持續投資，有幾個活動部件確實如此，我們第二季度的營業利潤率可能會在個位數/中位數百萬範圍內更多。

And I assume the operating guidance for the year would have gone up in absence of that acquisition then?

而且我認為如果沒有那次收購，今年的運營指導會上升嗎？

We gave guidance for the quarter that took into account a lot of variables, and I am not going to parcel out now with the specific impact if Area 1 would have been -- if we hadn't done that acquisition. So the guidance is an holistic picture on many things that move, and you should take it as that.

我們給出了考慮到很多變量的季度指導，如果我們沒有進行那次收購，我現在不打算討論如果第 1 區會產生的具體影響。因此，該指南是關於許多移動事物的整體圖景，您應該這樣看待它。

Your next question comes from the line of Trevor Walsh with JMP Securities.

您的下一個問題來自 JMP 證券公司的 Trevor Walsh。

Matthew, maybe a quick one for you around your comments around DNR. You mentioned your aspirational goal of 130%. What do you think is -- how do you get there? Is it kind of a function kind of where you're right now based on macroeconomics and just what's going on in terms of budgets? Or is there something internally that you guys are looking to maybe change and/or kind of refocus efforts on in order to drive that number up?

馬修，也許是你對 DNR 的評論的一個簡短的。您提到了 130% 的理想目標。你認為是什麼——你如何到達那裡？它是一種基於宏觀經濟學以及預算方面正在發生的事情的功能嗎？或者你們內部是否有一些事情可能會改變和/或重新集中精力以提高這個數字？

Yes. I think that it really is for us about how we bundle products together. Today, 29% of the Fortune 1000 are already Cloudflare customers. If you fast forward with that, I think that a very significant percentage of the Fortune 1000 are in the customers. And so what we really want to focus on is how do we get them to use more of our platform, and what I think is unique about Cloudflare is we've already got the products in place where we can have those customers adopt our more and more our platform.

是的。我認為這對我們來說確實是關於我們如何將產品捆綁在一起。如今，29% 的財富 1000 強企業已經是 Cloudflare 客戶。如果你快進，我認為財富 1000 強中有很大一部分是客戶。所以我們真正想要關注的是我們如何讓他們更多地使用我們的平台，我認為 Cloudflare 的獨特之處在於我們已經有了產品，我們可以讓這些客戶採用我們的更多和更多我們的平台。

There is not a single customer that uses every single feature of Cloudflare's platform today in terms of a contracted customer. And so I think that's where we really see that growing. And I think that's a very healthy way to expand spend with customers is to become more and more critical. What we want to be is the network that the Fortune 1000 relies on for connecting to the Internet, making sure that they're secure, making sure that their employees have the best experience possible and making sure that no matter what happens, they're always going to be online.

就簽約客戶而言，目前沒有一個客戶使用 Cloudflare 平台的每一項功能。所以我認為這就是我們真正看到這種增長的地方。而且我認為這是一種非常健康的方式來擴大與客戶的支出，它變得越來越重要。我們想要成為財富 1000 強企業賴以連接互聯網的網絡，確保他們的安全，確保他們的員工盡可能獲得最佳體驗，並確保無論發生什麼，他們都總是會在線。

Your next question comes from the line of James Breen with William Blair.

您的下一個問題來自 James Breen 和 William Blair。

Can you just talk a little bit about the CapEx was up a bit this quarter, a little bit higher than the guidance for the year, the range for the year. And how you think about that spending going forward? And maybe some of the puts and takes on cash flow relative to top line growth and where are areas where you can generate cash without too greatly impacting the top line?

您能否簡單談談本季度的資本支出有所上升，略高於今年的指導和今年的範圍。您如何看待未來的支出？也許一些與收入增長相關的看跌期權和現金流量以及在哪些領域可以產生現金而不會對收入產生太大影響？

Maybe I could start it on CapEx. I mean we're going to stay within the range that we guided for the year. We said before, you will see variability quarter-to-quarter just in terms of how we purchase, where we see opportunity to pull in spend and make sure that we maneuver ourselves smartly around the supply chain disruptions you see. This is pretty much driving the variability quarter-to-quarter, but we will stay within the range we guided for the year.

也許我可以從資本支出開始。我的意思是我們將保持在我們今年指導的範圍內。我們之前說過，您會看到每季度的變化，僅就我們的採購方式而言，我們看到了吸引支出的機會，並確保我們巧妙地應對您看到的供應鏈中斷。這在很大程度上推動了季度間的變化，但我們將保持在我們全年指導的範圍內。

From a free cash flow perspective, we said we have a lot of levers at hand. One of the biggest levers is moving to annual billing for our large customers. We are, from a company history perspective, coming from a pay-as-you-go business where people gave us a credit card even at the beginning of the second quarter, the majority of our revenue was monthly billing. So we've made first strides into that direction of annual billing. And there is a lot of opportunities still in front of us. So this, I would say, is the biggest lever, but we run a pretty holistic cash conversion project across the company that looks into literally anything that can positively impact free cash flow generation. And it's a cross-functional project, and it's -- we're making good progress, and you saw that already reflected in the second quarter numbers.

從自由現金流的角度來看，我們說我們手頭有很多槓桿。最大的槓桿之一是為我們的大客戶轉向按年計費。從公司歷史的角度來看，我們來自現收現付業務，即使在第二季度初人們就給了我們一張信用卡，我們的大部分收入都是按月計費的。因此，我們在按年計費的方向上邁出了第一步。而且還有很多機會擺在我們面前。因此，我想說，這是最大的槓桿，但我們在整個公司範圍內開展了一個非常全面的現金轉換項目，從字面上研究任何可以對自由現金流產生產生積極影響的事物。這是一個跨職能的項目，而且我們正在取得良好的進展，你看到這已經反映在第二季度的數據中。

Your next question comes from the line of Gray Powell with BTIG.

您的下一個問題來自 BTIG 的 Gray Powell。

All right. Great. Congratulations for the -- on the strong results. So yes, Matt, you called out the Fortune 500 energy company where you replace Zscaler. And then you talked about some other similar wins. I just want to make sure I have it correct. Are those mainly on the [VT&A] side with Cloudflare Access? Or were there some gateway wins as well? And then maybe can you just drill into a little bit more and talk about like why you want. Is it more on price technology or a combination of those?

好的。偉大的。祝賀 - 取得了不錯的成績。所以，是的，馬特，你打電話給財富 500 強能源公司，在那裡你取代了 Zscaler。然後你談到了其他一些類似的勝利。我只是想確保我有正確的。 Cloudflare Access 主要是在 [VT&A] 方面嗎？或者也有一些網關勝利？然後也許你可以再深入一點，談談你為什麼想要。更多的是價格技術還是兩者的結合？

Yes. So when we sell our Zero Trust solutions, we really believe that the pieces all fit together. And so those are typically wins -- sometimes somebody will just -- will just adopt one portion of the solution, but we really like to sell that holistic solution and see how all of the pieces fit together.

是的。因此，當我們銷售我們的零信任解決方案時，我們真的相信各個部分都可以組合在一起。所以這些通常是勝利——有時有人會——只會採用解決方案的一部分，但我們真的很喜歡銷售這種整體解決方案，看看所有部分是如何組合在一起的。

In terms of where we win, I think what we hear from the space is that our products are significantly more performant. We have a much more holistic solution where we can protect mobile devices in a way that a lot of the other providers can't. We can work across the geographies. When I was, this time last year, traveling in Africa using our products they worked great, whereas most people in the space don't have that broad of a network that can deliver that.

就我們在哪裡獲勝而言，我認為我們從太空中聽到的是我們的產品性能明顯更高。我們有一個更全面的解決方案，我們可以以許多其他提供商無法做到的方式保護移動設備。我們可以跨地域開展工作。去年這個時候，當我使用我們的產品在非洲旅行時，它們效果很好，而該領域的大多數人都沒有那麼廣泛的網絡可以提供這種服務。

And I think that we are just able to scale much more significantly. We have literally 2 orders of magnitude, more capacity to be able to handle the forward proxy traffic across us than any of the other providers in the space. And I think that, that's why we've been able to display some companies that have used -- that have tried to adopt Zscaler and found it less user-friendly and that it generated a lot of IT support tickets. But that's really not our focus. Our focus is going after all of the on-premise firewalls and hardware and VPNs that exist in the universe. And so I think they can be successful and we can be successful, but I think we have a better product. And over time, I think that will help us win.

而且我認為我們能夠更大幅度地擴展。與該領域的任何其他提供商相比，我們實際上有 2 個數量級的能力來處理我們的轉發代理流量。我認為，這就是為什麼我們能夠展示一些已經使用過的公司——這些公司試圖採用 Zscaler，但發現它對用戶不太友好，並且它產生了很多 IT 支持票。但這真的不是我們的重點。我們的重點是關注宇宙中存在的所有本地防火牆、硬件和 VPN。所以我認為他們可以成功，我們也可以成功，但我認為我們有更好的產品。隨著時間的推移，我認為這將幫助我們獲勝。

Your final question today comes from the line of Brent Thill with Jefferies.

您今天的最後一個問題來自 Jefferies 的 Brent Thill。

Matthew, on Area 1, I know it's early, but can you give us an update of what you're seeing there? And I guess, again, on the last question, can I squeeze one in at the end?

馬修，在 1 區，我知道現在還早，但你能告訴我們你在那裡看到的最新情況嗎？我想，在最後一個問題上，我可以在最後擠一個嗎？

The Area 1 tech is amazing. So the product, we're seeing really great wins from very large customers. And we think of that product as being a gateway to help with people on their Zero Trust journey. If you think about e-mail, the nature of it is it enumerates the employee directory of an organization, and it very much then helps us sell the other Zero Trust products that we have, and so that conversation is going well.

區域 1 的技術很棒。因此，我們從非常大的客戶那裡看到了非常好的產品。我們認為該產品是幫助人們進行零信任之旅的門戶。如果您考慮電子郵件，它的本質是枚舉組織的員工目錄，然後它非常有助於我們銷售我們擁有的其他零信任產品，因此對話進展順利。

It's also a conversation that is going well in terms of talking to our existing customers. It turns out everybody has got a fishing problem. It is for most of our customers, 1 click to sign up and test whether or not Area 1 can result in that. And so we're seeing $1 million-plus wins that close in oftentimes in a matter of days or a short number of weeks, which is just -- because we can just prove how successful that is.

在與我們現有客戶的交談方面，這也是一次進展順利的對話。事實證明，每個人都有釣魚問題。對於我們的大多數客戶來說，一鍵註冊並測試區域 1 是否可以實現。所以我們看到超過 100 萬美元的勝利經常在幾天或幾週內結束，這只是 - 因為我們可以證明這是多麼成功。

I think beyond that, everyone has helped us in a number of other ways. One, as I mentioned earlier, is that they had a much more sophisticated channel program, which has now helped develop our channel program, and I think we're really thankful for that team being on board. And then the third, which I think you'll hear us talk about more going forward is that they have a really world-class threat intelligence team. And that, I think, will turn into more products across our entire platform. And because I like your brand, I'll let you have on e more question.

我認為除此之外，每個人都以許多其他方式幫助了我們。一個，正如我之前提到的，他們有一個更複雜的頻道計劃，現在已經幫助開發了我們的頻道計劃，我認為我們非常感謝那個團隊的加入。然後第三個，我想你會聽到我們談論更多的是他們擁有一個真正世界級的威脅情報團隊。我認為，這將在我們整個平台上轉化為更多產品。因為我喜歡你的品牌，我會讓你有更多的問題。

I appreciate that. You've had the crystal ball and everyone appreciates your candor, and I think you were the first one to come out and say, hey, things are going a little different than they felt. I was just trying to understand, when you look at the perspective of what's happening now, you mentioned things have stabilized. I mean I just want to make sure we understand from your perspective, it hasn't gotten worse. It's come in that your -- the stabilization trend that you're seeing, have you seen that extend into July and the rest of the summer? What's your sense of kind of the trajectory from where things came in, where are you at now?

我很感激。你已經擁有了水晶球，每個人都欣賞你的坦率，我認為你是第一個站出來說，嘿，事情的進展與他們的感覺有些不同。我只是想理解，當你從現在發生的事情的角度來看，你提到事情已經穩定下來。我的意思是我只是想確保我們從你的角度理解，它並沒有變得更糟。這是因為你看到的穩定趨勢，你看到延續到七月和夏天剩下的時間了嗎？你對事物從哪裡來的軌蹟有什麼感覺，你現在在哪裡？

Yes, you got me in trouble with a lot of my peers at your conference, where I said that the economy was not as rosy as people think, and I think you've heard a lot of those folks echo those comments now in Q2.

是的，在你的會議上，你讓我和很多同行陷入了麻煩，我說經濟並不像人們想像的那麼樂觀，我想你已經聽到很多人在第二季度回應這些評論。

Let me be clear. I think that the economy is still in really rough shape. And I don't know -- and again, I'm not a member of the -- I'm not an economist. But from what we hear from customers, customers are really still suffering, And the economy, I wouldn't say that the economy itself has stabilized.

讓我說清楚。我認為經濟仍然處於非常糟糕的狀態。我不知道——再說一次，我不是該組織的成員——我不是經濟學家。但從我們從客戶那裡聽到的情況來看，客戶真的還在受苦，而經濟，我不會說經濟本身已經穩定下來。

What I would say is we have had the flexibility in our business to be able to adapt to a very difficult environment. That environment continues to be difficult, and I think it will be difficult at least through the rest of the year. But being able to deliver products that deliver real value, have an incredible ROI, can save customers' money and are must haves, not nice to haves, puts us in an incredibly powerful position. And as I said in the prepared remarks, I would not trade places with any other CEO.

我想說的是，我們的業務具有靈活性，能夠適應非常困難的環境。這種環境仍然很困難，我認為至少在今年剩下的時間裡會很困難。但是，能夠交付具有真正價值、具有令人難以置信的投資回報率、可以節省客戶的資金並且是必須擁有的產品，而不是好擁有的產品，這讓我們處於一個非常強大的位置。正如我在準備好的評論中所說，我不會與任何其他 CEO 交換位置。

This concludes our Q&A portion of the call. Matthew Prince, I turn the call back to you.

我們的電話問答部分到此結束。馬修普林斯，我把電話轉給你。

So I'd like to, first of all, thank a bunch of the students from the Berkeley School of Music to let us use some of their new and original songs for the hold music going in. So hope for those of you who tuned in the call early, hope you appreciated that. I also want to thank the analysts for actually asking Thomas some questions this time. Usually, I can get all the questions. Thanks to our team and all of our customers. We've got our hands on the wheel, our eyes on the road, and we'll see you all back here next quarter.

所以我想首先感謝伯克利音樂學院的一群學生讓我們使用他們的一些新的和原創的歌曲來播放音樂。所以希望你們這些收聽的人早點打電話，希望您對此表示讚賞。我還要感謝分析師這次實際上向托馬斯提出了一些問題。通常，我可以回答所有問題。感謝我們的團隊和所有的客戶。我們已經把手放在方向盤上，眼睛在路上，我們下個季度再見。

This concludes today's conference call. Thank you for attending. You may now disconnect.

今天的電話會議到此結束。感謝您的出席。您現在可以斷開連接。