tech
May 8, 2026
Cloudflare says AI made 1,100 jobs obsolete, even as revenue hit a record high
CloudFlare announced its first large-scale layoff. CEO Matthew Prince says because of AI efficiency gains, the company doesn't need as many support roles.
TL;DR
- Cloudflare announced a reduction of its workforce by approximately 1,100 employees, equating to 20% of its staff.
- This is the first mass layoff in the company's 16-year history.
- The layoffs are attributed to significant productivity gains realized through the company's adoption and use of AI.
- Despite the job cuts, Cloudflare reported record quarterly revenues of $639.8 million, a 34% year-over-year increase.
- The company experienced a net loss of $62.0 million in the quarter, a slight increase from the prior year.
- CEO Matthew Prince stated that AI has made employees, particularly in R&D, 2 to 100 times more productive.
- AI is being used across various departments, including engineering, HR, finance, and marketing, with thousands of AI agent sessions daily.
- Prince indicated that while support roles may be reduced, the company plans to continue hiring and investing in employees who embrace AI tools, potentially reaching more employees in 2027 than in 2026.