Cloudflare and DigitalOcean shares are falling, what you need to know

What happened

After Datadog forecast fourth-quarter revenue of $1.19 billion to $1.20 billion, suggesting flat sequential growth, shares of content delivery company Cloudflare fell 2.9% and data storage company DigitalOcean fell 3.7% in the morning session. Datadog’s third-quarter revenue rose 35% year over year to $1.20 billion.

Confirmed

Global impact / market context

Datadog’s forecast may lead investors to question whether enterprise cloud spending is slowing, because its usage-based business can reflect customer activity. If companies use fewer cloud services, infrastructure providers could face slower revenue growth, while concern about that outlook may weigh on their shares.

Analyst inference

The reported declines followed a Datadog outlook that suggested revenue would not grow from the prior quarter, despite strong annual growth. The article frames this as a read-through concern for infrastructure peers, not as evidence that Cloudflare or DigitalOcean reported weaker results themselves.

Analyst inference

What to watch

1. Datadog’s fourth-quarter revenue result will show whether it lands within its $1.19 billion to $1.20 billion forecast and whether sequential growth remains flat. Analyst inference
2. Future updates from Cloudflare and DigitalOcean could clarify whether customer demand or revenue growth is changing at either infrastructure company. Analyst inference
3. If enterprise cloud use moderates, infrastructure providers could see slower customer spending, which may constrain revenue growth and weigh on investor expectations. Analyst inference

Evidence

• stockstory.org