Form 4: Cloudflare President Sells $16.7M in Stock

Cloudflare President and Board Co-Chair Michelle Zatlyn executed pre-planned sales of 76,923 Class A Common Stock shares totaling approximately $16.7 million.

Summary

• Michelle Zatlyn, President and Board Co-Chair of Cloudflare, Inc., reported transactions involving the company's Class A and Class B Common Stock.
• Between October 7 and October 9, 2025, Ms. Zatlyn converted 76,923 shares of Class B Common Stock into Class A Common Stock through the exercise of fully vested employee stock options at an exercise price of $2.04 per share.
• Concurrently, Ms. Zatlyn sold a total of 76,923 shares of Class A Common Stock in multiple transactions over three days.
• These sales were executed pursuant to a Rule 10b5-1 trading plan adopted on February 14, 2025.
• The sales occurred at weighted average prices ranging from $214.8634 to $220.9941 per share.
• The total value of the Class A Common Stock sold is approximately $16.7 million.
• Following these transactions, Ms. Zatlyn's beneficial ownership includes 367,251 shares of Class A Common Stock held directly and 19,615 shares held indirectly through The SZ 2021 Irrevocable Trust.
• She also holds 1,902,556 direct employee stock options for Class B Common Stock and significant indirect holdings of Class B Common Stock convertible to Class A Common Stock through various trusts.

Sentiment

Score: 5

Explanation: The sentiment is neutral as the transactions are routine insider sales executed under a pre-established Rule 10b5-1 trading plan, which typically does not convey new information about the company's prospects.

Positives

• The sales were conducted under a pre-arranged Rule 10b5-1 trading plan, indicating they were not based on new, material non-public information.
• The exercise of employee stock options suggests the reporting person is realizing value from long-term equity incentives.

Negatives

• Insider selling, even if pre-planned, can sometimes be perceived negatively by some market participants, although the 10b5-1 plan mitigates this concern.

Future Outlook

NA

Industry Context

NA

Related Party Transactions

• A significant portion of the reporting person's holdings are held indirectly through various trusts, including The Sutherland/Zatlyn Revocable Trust, The SZ 2021 Irrevocable Trust, The SZ 2020 Irrevocable Trust, and several Sutherland/Zatlyn Annuity Trusts, for which the reporting person serves as a trustee, co-trustee, or appointer.

Stakeholder Impact

• Shareholders may note the insider selling, but the pre-arranged nature of the sales under a Rule 10b5-1 plan generally mitigates concerns about management's confidence in the company's future.

Key Dates

Recommendation

The reported transactions are routine insider sales executed under a pre-established Rule 10b5-1 trading plan, adopted on February 14, 2025. Such pre-planned sales are generally not indicative of management's current view on the company's prospects or stock valuation, as they are set up in advance to diversify holdings or manage personal finances. Therefore, this filing alone does not provide a basis for a change in investment recommendation.

Keywords

Cloudflare, NET, Michelle Zatlyn, Insider Trading, Form 4, Stock Sale, 10b5-1 Plan, Class A Common Stock, Class B Common Stock, Employee Stock Option