Business Wire·Aug 11, 2026, 4:00 AM ET

Cloudflare, Inc. Announces Pricing of Offering of $2.175 Billion of 0% Convertible Senior Notes Due 2031

NET

Cloudflare priced $2.175 billion of 0% convertible senior notes due 2031 in a private offering to qualified institutional buyers under Rule 144A.
Initial purchasers received an option to buy up to an additional $325 million of notes within a 13-day period.
Settlement is expected on August 13, 2026, generating approximately $2.14 billion in net proceeds assuming the option is not exercised.
The notes mature on August 15, 2031, do not bear regular interest, & principal will not accrete.
Redemption is restricted until August 20, 2029, except for cleanup redemptions when outstanding amounts fall below $200 million.
Optional redemption after August 20, 2029, requires the stock price to be at least 130% of the conversion price for 20 of 30 trading days.
Holders can require repurchase upon a fundamental change at 100% of principal plus accrued special interest.
Initial conversion rate is 2.0123 shares per $1,000 note, equating to a conversion price of approximately $496.94.
The conversion price represents a 60% premium over the August 10, 2026, stock price of $310.59.
Convertibility is restricted prior to May 15, 2031, but unrestricted on or after that date until maturity.
Conversions may be settled in cash, shares, or a combination at Cloudflare's election.
Cloudflare entered into capped call transactions with a cap price of approximately $854.12 to offset potential dilution.
Approximately $225.8 million of net proceeds will fund the capped call transactions.
Remaining proceeds will be used for general corporate purposes, including working capital, debt repayment, or acquisitions.
The offering was conducted via private placement memorandum without registration under the Securities Act.