Form 4: Cloudflare Director Sells Shares Under 10b5-1 Plan

Cloudflare Director Carl Ledbetter sold 15,000 shares of Class A Common Stock for $227.05 per share under a pre-arranged trading plan.

Summary

• Carl Ledbetter, a Director of Cloudflare, Inc. (NET), reported a sale of Class A Common Stock.
• The transaction involved the disposition of 15,000 shares at a price of $227.05 per share.
• The sale was executed on March 18, 2026.
• This transaction was conducted pursuant to a Rule 10b5-1 trading plan, which was adopted by Mr. Ledbetter on February 14, 2025.
• Following this transaction, Mr. Ledbetter beneficially owns 938,073 shares of Class A Common Stock.
• The shares are held indirectly by the Carl S. Ledbetter Trust dated February 14, 2020, for which Mr. Ledbetter serves as a trustee.

Sentiment

Score: 6

Explanation: StockSavvy.ai views this as a routine insider sale under a pre-arranged plan, which is less concerning than an unscheduled sale, but still represents a reduction in insider holdings. The 10b5-1 plan provides transparency and suggests a planned liquidity event.

Positives

• The transaction was executed pursuant to a Rule 10b5-1 trading plan, adopted on February 14, 2025, indicating a pre-scheduled sale rather than a reaction to immediate company news.

Negatives

• Director Carl Ledbetter disposed of 15,000 shares of Class A Common Stock, reducing his direct beneficial ownership.

Industry Context

StockSavvy.ai notes that insider sales, even when conducted under a Rule 10b5-1 plan, are closely monitored by investors as they represent a reduction in insider ownership. While a 10b5-1 plan mitigates the immediate negative signal often associated with insider sales, the market still considers the overall trend of insider buying and selling for sentiment analysis.

Related Party Transactions

• The shares are held of record by the Carl S. Ledbetter Trust dated February 14, 2020, for which the reporting person serves as a trustee, indicating an indirect beneficial ownership structure.

Stakeholder Impact

• Shareholders may interpret the sale as a slight negative signal regarding insider confidence, although the presence of a 10b5-1 plan lessens this impact by indicating a pre-planned transaction.

Key Dates

Recommendation

The sale by a director, while reducing insider ownership, was executed under a pre-arranged 10b5-1 trading plan. This suggests a planned liquidity event rather than a reaction to new negative information about the company. Therefore, this single transaction does not warrant a change from a neutral or 'hold' stance unless other significant factors are present.

Keywords

Cloudflare, NET, insider trading, Form 4, stock sale, director, Carl Ledbetter, 10b5-1 plan