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

Cloudflare President and Board Co-Chair Michelle Zatlyn sold a total of 76,923 Class A Common Stock shares across three days in March 2026, pursuant to a pre-arranged 10b5-1 trading plan.

Summary

• Michelle Zatlyn, President and Board Co-Chair of Cloudflare, Inc. (NET), executed a series of transactions from March 3-5, 2026.
• These transactions involved the conversion of 25,641 Class B Common Stock shares into Class A Common Stock each day, totaling 76,923 shares.
• Concurrently, 76,923 shares of Class A Common Stock were sold over the three days at weighted average prices ranging from $173.30 to $191.435.
• The sales were conducted under a Rule 10b5-1 trading plan adopted on February 14, 2025.
• Following these transactions, Zatlyn directly holds 406,811 Class A Common Stock shares and indirectly holds 19,615 Class A shares through a trust.
• Her direct holdings of employee stock options for Class B Common Stock decreased from 1,569,223 to 1,517,941.

Sentiment

Score: 5

Explanation: StockSavvy.ai views this as a neutral event. While insider selling can sometimes be a negative signal, these transactions were pre-planned under a 10b5-1 plan, which mitigates concerns about opportunistic selling based on new information.

Positives

• The transactions were executed under a pre-arranged Rule 10b5-1 trading plan, indicating a systematic approach to managing equity rather than a reaction to new, negative information.
• The shares sold were acquired through the exercise of fully vested and immediately exercisable employee stock options, representing a realization of long-term compensation.

Negatives

• Significant insider selling, totaling 76,923 shares of Class A Common Stock, could be perceived negatively by some investors, even if pre-planned.

Future Outlook

NA

Industry Context

StockSavvy.ai notes that insider transactions, particularly sales, are common for executives managing their personal portfolios and diversifying wealth, especially when executed under a pre-arranged 10b5-1 plan. Such plans are designed to avoid accusations of trading on material non-public information and are a standard practice for long-tenured executives.

Related Party Transactions

• Shares are held indirectly through various trusts (The Sutherland/Zatlyn Revocable Trust, The SZ 2021 Irrevocable Trust, The SZ 2020 Irrevocable Trust, The SZ 2023 Irrevocable Trust, The Sutherland/Zatlyn 2024 Annuity Trust, The Sutherland/Zatlyn 2024 Annuity Trust II, The Sutherland/Zatlyn 2024 Annuity Trust III, The Sutherland/Zatlyn 2025 Annuity Trust, The Sutherland/Zatlyn 2025 Annuity Trust II, The Sutherland/Zatlyn 2025 Annuity Trust III) for which Michelle Zatlyn serves as co-trustee, appointer, investment advisor, or trustee.

Stakeholder Impact

• Shareholders: The sale of shares by a high-ranking executive could be interpreted in various ways, from routine portfolio management to a lack of confidence, though the 10b5-1 plan suggests the former.

Key Dates

Recommendation

The transactions are routine insider sales executed under a pre-planned 10b5-1 trading plan, which is a common practice for executives to manage their personal finances and diversify holdings. This type of transaction typically does not reflect new material information about the company's performance or outlook and therefore does not warrant a change in investment recommendation based solely on this filing.

Keywords

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