Cloudflare Inc. (NYSE:NET) shares are trading higher on Monday after acquiring Outerbase, a database tool designed with developers in mind, as part of a broader effort to simplify the creation of AI-driven applications on its cloud platform.

This acquisition is set to boost the overall experience for developers, especially those using Cloudflare Workers by making it easier to manage and connect to databases during the app-building process.

Financial terms of the deal were not disclosed. Cloudfare held $147.6 million in cash and equivalents as of December 31, 2024.

Outerbase offers accessible, easy-to-use database solutions that empower developers regardless of their SQL proficiency to build and maintain backend infrastructure.

These features will be embedded into Cloudflare’s existing products, such as Durable Objects, the D1 database, and its newly launched Agents SDK, which enables the development of AI agents that respond intelligently to contextual data.

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Cloudflare sees this deal as key to preparing its developer platform for a surge in application development driven by AI innovation.

“Businesses are racing to build AI-powered applications to be as productive, innovative, and competitive as possible. Our goal is to make it easy and accessible for any developer, regardless of expertise, to build database-backed applications that can scale,” said Cloudflare co-founder and CEO Matthew Prince.

The company said more software will be built in the next five years than in the past two decades combined, with databases serving as a vital foundation for managing dynamic conversations, storing real-time context, and executing AI logic.

“At Outerbase, our mission has always been to make working with data easier for developers. Joining Cloudflare allows us to keep doing that, but faster and at a much larger scale,” said Outerbase co-founder and CEO Brandon Strittmatter.

Cloudflare said the deal will help lower the technical barrier for developers looking to create full-stack applications with embedded AI features.

Also, today Cloudflare unveiled new tools aimed at speeding up AI agent development, including the remote Model Context Protocol (MCP) server, general access to durable Workflows, and a free tier for Durable Objects. These enhancements are designed to let developers quickly and cost-effectively build scalable AI agents in a matter of minutes.

NET Price Action: NET shares traded slightly higher at $97.85 at publication Monday.

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