---
title: "Cloudflare hires a Splunk sales chief to price AI agent traffic as shares trade at 169 times earnings"
description: "Cloudflare hired a Splunk-grade sales chief right after its fastest growth in four years. His real job: turning the AI agent traffic already on its network into revenue the market at 169x earnings is paying for in advance."
publisher: "The Inference"
section: "Platforms"
published: 2026-11-12T16:29:28.800Z
modified: 2026-11-12T16:29:28.800Z
canonical: https://theinference.org/article/cloudflare-hires-a-splunk-sales-chief-to-price-ai-agent-traffic-as-shares-trade-at-169-times-earnings
language: en
keywords: "Cloudflare, AI Agents, Enterprise Software, Valuation, Earnings"
---

# Cloudflare hires a Splunk sales chief to price AI agent traffic as shares trade at 169 times earnings

> Cloudflare hired a Splunk-grade sales chief right after its fastest growth in four years. His real job: turning the AI agent traffic already on its network into revenue the market at 169x earnings is paying for in advance.

[Cloudflare](https://theinference.org/markets/companies/cloudflare) has hired a salesman for traffic nobody has priced yet. On November 5, alongside [its best quarter ever](https://theinference.org/article/cloudflare-grew-39-after-cutting-20-of-staff-datadog-fell-7-5-on-an-outlook-hinging-on-one-ai-customer), the company named [Christian Smith](https://theinference.org/markets/people/christian-smith) president of revenue, formally tasked with the push to $5 billion in annual recurring revenue [1]. Smith ran global go-to-market at Splunk as chief revenue officer and scaled its recurring revenue past $4 billion through a business-model change of exactly the kind Cloudflare now faces [1]. [The coverage noted the hire and the record quarter](https://www.channeldive.com/news/cloudflare-appoints-president-of-revenue/874181/) [2]; almost no one asked what he is being hired to sell.

## The traffic arrived before the price did

AI agents and crawlers already move more bits than people do. Prince said on the second-quarter call that non-human traffic passed human traffic on Cloudflare's network in May [5]. Cloudflare spent this year building the control layer on top: separate permissions for search, AI training and AI agents, and an Accountable designation that [Apple](https://theinference.org/markets/companies/apple), Google and [Microsoft](https://theinference.org/markets/companies/microsoft) now meet [6].

In the third quarter the company [booked its first revenue under what it calls Act 4](https://theinference.org/article/cloudflare-now-bills-agent-web-search-and-exa-priced-for-a-buyer-who-cannot-switch), its new business models for the agentic Internet, including a service that helps [OpenAI](https://theinference.org/markets/companies/openai) crawl more efficiently [5]. It never disclosed the amount [5]. That is the gap in plain terms: the capability exists, the invoice does not.

*Chart: **Cloudflare's revenue has set a record every quarter for a year, reaching $782.5 million** Column chart of Cloudflare's quarterly revenue from Q4 2023 to Q3 2026, rising from $362.5 million to a record $782.5 million*

*Quarterly revenue in dollars, from Cloudflare's SEC filings. The September 2026 quarter grew 39.2% from a year earlier, the fastest since 2022. Source: Cloudflare SEC filings [9]. [9]*

## Why the job needs a Splunk-grade CRO

Closing that gap is enterprise selling, not plumbing. Customers management counts as large now bring in 75% of revenue, up from 73% a year earlier [4]. The number bulls quote, more than 5,000 customers paying $100,000 a year, [circulates on X, not in any filing](https://x.com/Fiscal_ai/status/2118458338623287427) [8]. Meanwhile carrying the traffic is not free: [GAAP gross margin fell to 71.2% from 74.0% a year earlier](https://www.cloudflare.com/press/press-releases/2026/cloudflare-announces-third-quarter-2026-financial-results/) [3].

*Chart: **Gross margin has fallen 5.8 points in three years as the traffic scaled** Line chart of Cloudflare's GAAP gross margin each quarter from Q4 2023 to Q3 2026, falling from 77.0% to 71.2%*

*GAAP gross margin as a percentage of revenue each quarter, from Cloudflare's SEC filings. The company reported 71.2% in the September 2026 quarter, down from 74.0% a year earlier. Source: Cloudflare SEC filings [9]. [9]*

## The market is paying ahead of the invoice

At [169 times forward earnings](https://theinference.org/article/cloudflare-is-buying-the-whole-stack-ai-agents-build-on-and-the-stock-trades-at-49-5-times-sales), after losing 12.8% in a month to November 10, shareholders are already paying for revenue Act 4 has not yet produced; analysts model $5.09 billion of 2028 revenue, above management's own $5 billion goal [7][5]. The tells are dated: the GAAP profit management expects for the December quarter, and the first sized Act 4 dollar, both due in the February report [4].

Smith is the right hire because pricing agent traffic is real work and whoever does it deserves the reward. The bet at this price is that he does it in 2027, not that someone eventually will.

## Takeaway

Cloudflare hired Christian Smith, the sales chief who scaled Splunk's recurring revenue, to put a price on the AI agent traffic already crossing its network. At 169 times forward earnings the stock assumes he does it in 2027.

## Sources

1. [Cloudflare press release, Cloudflare Appoints Christian Smith as President of Revenue, 5 November 2026](https://www.cloudflare.com/press/press-releases/2026/cloudflare-appoints-christian-smith-as-president-of-revenue/)
2. [Channel Dive (Industry Dive), Cloudflare appoints president of revenue, 10 November 2026](https://www.channeldive.com/news/cloudflare-appoints-president-of-revenue/874181/)
3. [Cloudflare press release, Cloudflare Announces Third Quarter 2026 Financial Results, 5 November 2026](https://www.cloudflare.com/press/press-releases/2026/cloudflare-announces-third-quarter-2026-financial-results/)
4. [Trefis Team, How Big Could Cloudflare Stock's Next Fall Be?, 11 November 2026](https://www.trefis.com/stock/net/articles/624233/how-big-could-cloudflare-stocks-next-fall-be/2026-11-11)
5. [Yahoo Finance (Gian Estrada, TIKR), Jim Cramer Calls Cloudflare "the Most Expensive Stock in the Market." He Still Prefers It, 11 November 2026](https://finance.yahoo.com/markets/stocks/articles/jim-cramer-calls-cloudflare-most-162950373.html)
6. [Cloudflare press release, Cloudflare Helps End the Search-or-AI-Training Tradeoff, 15 September 2026](https://www.cloudflare.com/press/press-releases/2026/cloudflare-helps-end-the-search-or-ai-training-tradeoff/)
7. [Yahoo Finance (CNW/Equity Insider), Security Software Results Arrive in Stages, With Another Report Set for Nov. 18, 12 November 2026](https://finance.yahoo.com/technology/articles/security-software-results-arrive-stages-120200707.html)
8. [@Fiscal_ai post on X, 5 November 2026](https://x.com/Fiscal_ai/status/2118458338623287427)
9. [Cloudflare, quarterly figures from its SEC filings, retrieved 12 November 2026](https://www.sec.gov/cgi-bin/browse-edgar?action=getcompany&CIK=0001477333)


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Cloudflare hires a Splunk sales chief to price AI agent traffic as shares trade at 169 times earnings — The Inference. Canonical: https://theinference.org/article/cloudflare-hires-a-splunk-sales-chief-to-price-ai-agent-traffic-as-shares-trade-at-169-times-earnings