Get 40% Off
🤯 This Tech Portfolio is up 29% YTD! Join Now to Get April’s Top PicksGet The Picks – Just 99 USD

Cloudflare jumps as MoffettNathanson points to ChatGPT links and AI opportunities

Published 02/03/2023, 05:10 AM
Updated 02/03/2023, 05:10 AM
© Shutterstock

© Shutterstock

By Sam Boughedda

Cloudflare (NYSE:NET) jumped over 12% Thursday after a research note from MoffettNathanson said the company has a massive opportunity in supporting AI workloads.

Analysts told investors in the note that looking at the recent rapid rise in AI interest, they believe it will "far outweigh" any Cloudflare bear concerns regarding its exposure to struggling crypto exchanges over the last twelve months.

They said that Cloudflare's crypto exchange customers include Coinbase (NASDAQ:COIN), FTX, Bitfinex, WazirX, and OKX. They added that with the FTX woes well publicized, other firms have been negatively impacted by falling cryptocurrency prices.

"Our view is that this fixation on the crypto exposure has overshadowed two massive opportunities for Cloudflare that we believe are underappreciated: 1) supporting AI workloads and 2) Apple's (NASDAQ:AAPL, Not Rated) iCloud Private Relay, which is out of beta. We believe these two opportunities can ultimately dwarf the declines in crypto exchange revenue," wrote the analysts.

The analysts went on to state that while ChatGPT and the investment from Microsoft (NASDAQ:MSFT) have dominated headlines, investors might have missed that the "performance and security" of chat.openai.com is done by Cloudflare.

"We think there is a substantial opportunity for Cloudflare to support ChatGPT and other AI workloads," the analysts argued.

Latest comments

Risk Disclosure: Trading in financial instruments and/or cryptocurrencies involves high risks including the risk of losing some, or all, of your investment amount, and may not be suitable for all investors. Prices of cryptocurrencies are extremely volatile and may be affected by external factors such as financial, regulatory or political events. Trading on margin increases the financial risks.
Before deciding to trade in financial instrument or cryptocurrencies you should be fully informed of the risks and costs associated with trading the financial markets, carefully consider your investment objectives, level of experience, and risk appetite, and seek professional advice where needed.
Fusion Media would like to remind you that the data contained in this website is not necessarily real-time nor accurate. The data and prices on the website are not necessarily provided by any market or exchange, but may be provided by market makers, and so prices may not be accurate and may differ from the actual price at any given market, meaning prices are indicative and not appropriate for trading purposes. Fusion Media and any provider of the data contained in this website will not accept liability for any loss or damage as a result of your trading, or your reliance on the information contained within this website.
It is prohibited to use, store, reproduce, display, modify, transmit or distribute the data contained in this website without the explicit prior written permission of Fusion Media and/or the data provider. All intellectual property rights are reserved by the providers and/or the exchange providing the data contained in this website.
Fusion Media may be compensated by the advertisers that appear on the website, based on your interaction with the advertisements or advertisers.
© 2007-2024 - Fusion Media Limited. All Rights Reserved.