Citigroup Slashes Confluent (CFLT) Price Target Amid Cloud Optimization Headwinds

Confluent, Inc. (NASDAQ:CFLT) is one of the best mid cap AI stocks to buy right now. Confluent, Inc. (NASDAQ:CFLT) is one of the best midcap AI stocks to buy right now. On August 4, 2025, Citigroup maintained its Neutral rating on Confluent but sharply lowered its price target from $30 to $20, signaling a more cautious stance on the company’s near-term growth trajectory. Analyst Tyler Radke cited ongoing cloud optimization trends among Confluent’s largest customers, which are expected to weigh on the company’s cloud revenue growth well into the first half of 2026.

Despite the downgrade, the report acknowledged Confluent’s position as a leader in real-time data streaming and event-driven architecture. However, with macro pressures prompting clients to rein in cloud spend and elongate deal cycles, Citigroup opted to stay on the sidelines until demand signals improve. The lowered price target reflects a tempered outlook on both consumption-based revenue and the pace of enterprise expansion over the next few quarters.

Confluent is a data infrastructure company based in California. It provides a cloud-native platform built around Apache Kafka, enabling organizations to stream, process, and react to data in real time.

While we acknowledge the potential of CFLT to grow, our conviction lies in the belief that some AI stocks hold greater promise for delivering higher returns and have limited downside risk. If you are looking for an AI stock that is more promising than CFLT and that has 100x upside potential, check out our report about this cheapest AI stock.

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