This study investigates the effects of cutout size and position on the progressive failure characteristics of constant-stiffness and steered-fiber variable-stiffness carbon-fiber-reinforced-polymer cylindrical shells under pure bending. The geometries of the shells with the proposed cutouts are described, and the analysis methods that are used for the evaluation of the buckling and failure characteristics of the shells are detailed. Measured geometric imperfections are introduced during nonlinear progressive analyses. Results of a parametric study varying the location and size of the cutouts and investigating the maximum load levels and predominant failure modes for specific constant-stiffness and variable-stiffness layups are presented. Three specific failure modes are identified and related to the cutout size and location. Candidate configurations for future testing were selected based on the failure mode characteristics to validate the shell analysis conclusions.