Matthew Hedberg: Great. Thanks, guys.
Operator: Next up, we’ll hear from Sterling Auty, SVB.
Sterling Auty: Thanks, guys. So Matthew, I think it would be helpful for investors to understand. You had talked about the AI opportunity and the use cases, but help investors understand how the revenue opportunity with those types of customers actually ramped since you have that subscription model versus a consumption model.
Matthew Prince: Yes. So the way that we’ve been — the way that it has sort of been the natural way that we thought companies like AI companies would consume Cloudflare would be looking at our security products. And those are products that, as you said, are subscription-based and there’s some opportunity there, but there really aren’t yet that many AI companies. So that opportunity is fine. But I don’t think it’s anything that we would get really excited about. I think what we’re seeing though is in that cluster of AI companies, they have a real use case for the cloud which is somewhat different than what we see from some other companies. It is, I would say, more forward leaning and that is that they are constantly looking for wherever the best model or wherever the cheapest GPUs are to process their data.
And so they are looking around across multiple different cloud providers, whether that’s Google or Microsoft or AWS and they’re always saying, what can we take advantage of and get as much out of that as possible. And what the challenge for them is, is the AI training sets or these big lumps of data that they then have to sort of bring to wherever the model or bring to wherever that GPU is. And in that case, a lot of the workers products and, in particular, our R2 product, are a very natural way that they can put the data in one neutral location and then be able to access it all around in other locations as well. And what we’re seeing is that that neutral position of R2 is actually not just appealing for people in the AI space, but for anyone that has shared data that they want to use not in just one cloud but across multiple different clouds.
And so I think by having a way to embed data into the network and store data into the network, that is an opportunity for us to service anybody who is trying to be multi-cloud, which is frankly what every big enterprise today is doing. And in that case, R2 is very much a consumption-based product. And so as AI data sets get larger and larger, we expect that we will be able to grow R2 revenue along with that. And actually, our largest R2 customers, as I mentioned in the prepared remarks, is an AI company and they’re growing at just extraordinary rates as they put more data into their models.
Sterling Auty: And then just a quick follow up is, how much of that ramp is factored into the full year guide?
Matthew Prince: I think that we are not looking for anything exotic here. I think, again, prudence is very much the sort of word of the quarter for us. And I think that we’re not sort of counting on something that is the new hot thing doubling down on Cloudflare. And so while we’re very proud of what we have done with companies in the AI space, and we’re excited about the ramp in products like R2 and the overall workers ecosystem, we still think of that more as a long-term opportunity than a short-term quarterly or even 2023 opportunity. And so I think that we’re not relying on sort of an AI miracle in order to make the numbers that we put up.
Sterling Auty: Understood. Thank you.
Operator: Next, we’ll take a question from James Breen, William Blair.
