Confluent (CFLT) AI Stock Analysis

• Market Cap: $9.05B
• Dividend Yield: N/A
• Average Volume (3M): 5.14M
• Price to Earnings (P/E): ―
• Beta (1Y): 1.32
• Revenue Growth: 24.11%
• EPS Growth: 21.87%
• Country: US
• Employees: 3,060
• Sector: Technology
• Sector Strength: 90
• Industry: Software - Infrastructure
• EPS (TTM): 0.08
• Shares Outstanding: 286,330,080
• 10 Day Avg. Volume: 5,484,427
• 30 Day Avg. Volume: 5,142,715
• PEG Ratio: -2.98
• Price to Book (P/B): 8.60
• Price to Sales (P/S): 0.00
• P/FCF Ratio: 688.65
• Enterprise Value/Market Cap: 1.09
• Enterprise Value/Revenue: 17.80
• Enterprise Value/Gross Profit: 298.71
• Enterprise Value/Ebitda: -29.42
• 1Y Price Target: $28.65
• Price Target Upside: 7.71% Upside
• Rating Consensus: Moderate Buy
• Number of Analyst Covering: 25

• Rating: 66 Neutral
• Price Target: $27.00 ▲(1.50%Upside)

Confluent's overall stock score is primarily driven by strong technical performance and positive sentiment from the earnings call, indicating robust growth in subscription and cloud revenues. However, financial performance and valuation are areas of concern due to ongoing profitability challenges and a negative P/E ratio. The absence of notable corporate events and high liabilities also weigh on the overall score.

Positive Factors

Market Position

Confluent is positioned as the leader in real-time data streaming with a unique advantage at the intersection of open-source Kafka, platform expansion, and AI infrastructure modernization.

Product Adoption

Encouraging signals around new product adoption (Flink, TableFlow, Warpstream).

Subscription Revenue

Demand appears to be improving with Confluent budgets increasing by 10.6% year-over-year, indicating potential upside to subscription revenue targets.

Negative Factors

Cloud Revenue Growth

Cloud revenue growth has been generally decelerating over the past quarters, creating a headwind to sentiment.

Customer Consumption

Management observed that larger customers began slowing the pace of new use case additions and focusing on cost optimization efforts, with no expected near-term rebound in consumption.

Guidance and Expectations

A slight guidance cut steals thunder from an otherwise stellar Q1.

Confluent Business Overview & Revenue Model

Company Description

Confluent, Inc. is a technology company specializing in data streaming services. It operates primarily in the information technology and software sectors, providing a cloud-based platform that enables organizations to harness the power of real-time data streams. Confluent's core products include Confluent Platform and Confluent Cloud, which are built on Apache Kafka, an open-source stream processing software. These solutions allow companies to connect, process, and react to data in real-time, facilitating enhanced decision-making and operational efficiency.

How the Company Makes Money

Confluent generates revenue through a combination of subscription-based services and professional support offerings. The primary revenue stream comes from its Confluent Cloud, a managed service that charges customers based on their usage of data streaming capabilities. This includes fees for data storage, processing, and transfer. Additionally, Confluent Platform, a self-managed software offering, provides another revenue stream through licensing fees. The company also offers training, consulting, and support services, which contribute to its earnings. Key partnerships with cloud providers and enterprise clients further bolster Confluent's revenue, enabling it to tap into a broad customer base seeking robust data streaming solutions.

Confluent Financial Statement Overview

Summary

Confluent's financial performance shows strong revenue growth and a solid gross profit margin. However, profitability remains a challenge with negative net and operational margins. The balance sheet is stable with a balanced debt-to-equity ratio, but high liabilities could pose risks. Improvements in cash flow generation are promising but need to be sustained for long-term stability.

Income Statement

Confluent has shown robust revenue growth, increasing from $236.6 million in 2020 to $1.02 billion in TTM 2025. The company demonstrates a strong gross profit margin, which stands at 73.9% for TTM 2025. However, the net profit margin remains negative, indicating ongoing challenges in achieving profitability, with a net income loss of $319.7 million in TTM 2025. EBIT and EBITDA margins are also negative, reflecting operational inefficiencies. Overall, the company is growing its top line but needs to manage costs better to achieve profitability.

Balance Sheet

Confluent maintains a solid equity base, with stockholders' equity increasing to $1.03 billion in TTM 2025. The debt-to-equity ratio is relatively moderate at 1.08, suggesting a balanced approach to leveraging debt for growth. The equity ratio improved to 38.0%, indicating a stable financial position with a strong asset base. While the company has increased its cash reserves, the overall liabilities remain high, which could pose risks if revenue growth slows.

Cash Flow

The company managed to turn its free cash flow positive in TTM 2025 with $12.9 million, a significant improvement from negative values in previous years. The operating cash flow to net income ratio remains low, indicating that cash generation from operations is still a challenge. Free cash flow growth is positive, but the company needs to focus on sustaining this trend to support its growth initiatives without relying heavily on external financing.

Breakdown	Dec 2024	Dec 2023	Dec 2022	Dec 2021	Dec 2020
Income Statement
Total Revenue	963.64M	776.95M	585.94M	387.86M	236.58M
Gross Profit	706.17M	547.28M	383.53M	250.57M	161.10M
EBITDA	-419.15M	-430.01M	-455.05M	-335.99M	-231.61M
Net Income	-345.06M	-442.75M	-452.55M	-342.80M	-229.83M
Balance Sheet
Total Assets	2.69B	2.46B	2.34B	2.34B	526.12M
Cash, Cash Equivalents and Short-Term Investments	1.91B	1.90B	1.93B	2.02B	288.55M
Total Debt	1.11B	1.11B	1.12B	1.12B	50.93M
Total Liabilities	1.73B	1.65B	1.58B	1.49B	832.37M
Stockholders Equity	961.23M	810.41M	769.48M	850.28M	-306.25M
Cash Flow
Free Cash Flow	9.49M	-124.34M	-171.79M	-114.00M	-86.71M
Operating Cash Flow	33.46M	-103.66M	-157.33M	-105.06M	-82.06M
Investing Cash Flow	-74.98M	-84.85M	-865.80M	-400.58M	-176.86M
Financing Cash Flow	79.81M	102.37M	82.24M	1.84B	276.76M

Confluent Technical Analysis

• Technical Analysis Sentiment: Positive
• Last Price: 26.60
• 50DMA: Positive
• 100DMA: Positive
• 200DMA: Positive
• MACD: Negative
• RSI: Negative
• STOCH: Negative

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For CFLT, the sentiment is Positive. The current price of 26.6 is above the 20-day moving average (MA) of 25.38, above the 50-day MA of 24.13, and above the 200-day MA of 26.16, indicating a bullish trend. The MACD of 0.66 indicates Negative momentum. The RSI at 71.09 is Negative, neither overbought nor oversold. The STOCH value of 89.16 is Negative, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for CFLT.

Confluent Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
INFA	78 Outperform	$8.57B	5,231.91	0.09%	―	2.28%	―
MDB	74 Outperform	$19.22B	―	-4.00%	―	19.24%	59.66%
PATH	69 Neutral	$6.59B	―	-3.62%	―	7.21%	23.13%
DBX	67 Neutral	$7.86B	18.34	-60.11%	―	0.79%	0.59%
CFLT	66 Neutral	$9.05B	―	-34.18%	―	24.11%	21.87%
S	64 Neutral	$6.47B	―	-26.98%	―	32.25%	20.56%
Sector *	63 Neutral	$34.70B	5.15	-11.38%	1.67%	5.54%	-17.15%

Confluent Corporate Events

Confluent Holds 2025 Annual Stockholders Meeting

On June 11, 2025, Confluent, Inc. conducted its 2025 Annual Meeting of Stockholders, where holders of Class A and Class B common stock participated in voting on three proposals. The stockholders elected Class I directors to serve until 2028, ratified the appointment of PricewaterhouseCoopers LLP as the independent registered public accounting firm for 2025, and approved the compensation of named executive officers on a non-binding advisory basis.

The most recent analyst rating on (CFLT) stock is a Hold with a $28.00 price target. To see the full list of analyst forecasts on Confluent stock, see the CFLT Stock Forecast page.