Cloudflare has announced the pricing of a $2.175 billion private offering of 0% convertible senior notes, which are due in 2031. The company expects to receive net proceeds of approximately $2.14 billion from the sale, which is scheduled to settle on August 13, 2026.
The senior, unsecured notes will not bear regular interest. They will be convertible into Cloudflare's Class A common stock at an initial price of approximately $496.94 per share, representing a 60% premium over the stock's closing price on August 10, 2026. To reduce potential shareholder dilution from the conversion, Cloudflare has entered into capped call transactions.
A portion of the proceeds, about $225.8 million, will fund these capped call transactions. The remainder is allocated for general corporate purposes, which may include capital expenditures, debt repayment, and potential acquisitions.