Cloudflare CEO: AI Agents Are a Bane for Some Sites
On an earnings call, Matthew Prince said agent traffic costs site owners money and that containers may struggle to keep up. Shares rose about 15 percent.
Cloudflare shares jumped about 15 percent in after-hours trading after an earnings call in which CEO Matthew Prince made a pointed case. Some customers, he said, regard AI agents as "a bane to their business".
Containers under pressure
Prince gave containers credit first. In his words they are "a significant improvement over bare metal or even virtual machines", and they fed the rise of hyperscale clouds and mobile apps. Then he turned. A container packages an application with what it needs to run, and big cloud providers build their platforms on that model.
His complaint is about cost. The container-based architecture of the hyperscalers and neoclouds, he argued, cannot keep up in a cost-effective way with agent workloads. He leaned on a ratio Cloudflare expects: 1,000 bots for every human online.
The argument comes from a seller. Cloudflare offers its serverless Workers service as the alternative, where developers run code without managing servers themselves.
Who pays when an agent browses
Prince described a simple case. Picture him asking an agent to find dinner after work. It might read the websites of 1,000 restaurants and download 1,000 menus, and he would choose one. The other 999 restaurants carry a cost and get nothing in return.
He conceded that ordinary web search has always brought some traffic of little value. What changed, he said, is the sheer volume. Cloudflare has earlier predicted that agent activity will be one thousand times greater than human clicks.
Products, customers and the numbers
Cloudflare sells tools to block agents, to ease their cost and traffic effects, or to let organizations earn money from AI-generated traffic. Prince said demand is growing fast. By his claim, approximately five percent of the web has opted into its content protection products since July 1.
Meta is already a customer, he said, and its new Muse agents should create more agent traffic that third parties want to tame.
Revenue for the quarter reached a record $782.5 million, up 39 percent on a year earlier. The share rise came after losses earlier in the day, when major US indices fell about four percent amid worries that tech stocks are overvalued.
Security, and an expected finding
Prince also turned to security. Nation-state actors and criminals, he said, probably used the PHP2SHELL vulnerability before it was disclosed. Such flaws, he said, had been circulating for years. Cloudflare is going back through its logs, and he expects to find examples.
He does not think the worst is over. He argued that Cloudflare gains from the mess: its reach and client base put it among the first to get quiet disclosures of new vulnerabilities, and it fixes them before they become public.
Source: The Register