Cloud computing consists of services provided via the internet, including data storage, analytics, server management, and cyber security. The cloud computing market is estimated to be worth $445 billion in 2021, but the total value is set to more than double over the next five years to $947 billion, according to experts. With that in mind, we're looking at our favorite cloud stocks from 2021

Some top-performing cloud stocks in 2021

Cloudflare

This was the one that got away -- that feeling you get when you've missed the boat but the stock continues rocketing to new highs.

What a year Cloudflare (NYSE: NET) had. What a great two years it's had even! The company hasn't slowed down at all since arriving on the markets in 2019, up over 900% in 27 months.

Since it went public, Cloudflare has more than tripled its number of enterprise customers which is defined as companies with more than $100,000 in annualized recurring revenue (ARR), from 387 at IPO, to 1,260 in its most recent quarter.

Revenue in Q3 2021 grew 51% year-over-year as well, and the company is sitting on a cash pile of $1.8 billion as it continues to innovate in its industry and develop new products and services for customers.

Datadog

No longer an innocent little puppy, Datadog (NYSE: DDOG) has been baring its teeth to the market since its 2019 public debut and now boasts a mid-sized market cap, and it's been a front-runner ever since.

Datadog has more than 450 application integrations built-in, including Google Cloud Services, Amazon Web Services, and Microsoft Azure which makes cloud migration easy for new customers that want to continue using essential tools that help run their business. Datadog can then pull in all of the data from these services to analyze and use artificial intelligence (AI) so businesses can monitor and identify data-driven solutions for their digital infrastructure.

Its grown customers with more than $100,000 in ARR from 1,082 in Q3 2020 to over 1,800 in Q3 2021. Revenue for its most recent quarter was $270 million, a 75% increase YoY.

Twilio

Twilio (NYSE: TWLO), in contrast to its predecessors here, hasn't had the best of years. A specialist in communication, the company is involved in chatbots, automated email and text messages, push notifications, and personalized support for call centers. The company also owns Authy, a fraud detection and securitization service that can be integrated with mobile and web applications to add an extra layer of security for businesses and consumers.

Twilio was a top performer in 2020, which may have had a hand in its pullback this year -- these high growth picks can deliver outstanding returns but it comes with price volatility. Despite the slump this year, however, Twilio is continuing on its growth trajectory, increasing revenue by 65% YoY to $740 million in its most recent quarter.

Its top 10 customer accounts now represent only 11% of revenues compared to 14% a year ago, which limits the downside, should any large customers cease service with the business. Twilio also has a diverse revenue stream geographically, with one-third coming from international customers and two-thirds coming from U.S.-based companies. 

Takeaway

Many of these stocks are in high-growth mode and will likely experience wild fluctuations in valuation in the short term. But they have clearly become leaders in their respective categories pointing towards a prosperous 2022 and beyond. The sheer demand for their services in tech and increasingly digitized businesses means there's probably a lot more double-digit growth to come.