Cloudflare announces massive layoffs to make room for AI agents
Despite Cloudflare’s staggering financial results, the tech company is cutting its workforce by more than 1,100 employees globally. This is to prepare the company for the “agentic AI era.”
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Cloudflare cuts over 1,100 jobs to prepare for “AI agent era” despite strong revenue growth.
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CEO says layoffs are not about cost-cutting but about "defining how a world-class company operates in the agentic AI era."
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Company's AI usage has surged 600% in three months, with employees running thousands of AI agent sessions daily.
That’s what Cloudflare told workers in an email that has been uploaded to the company’s blog.
Last week, Cloudflare unveiled its financial results. In the first quarter of 2026, revenue went up by 34% year-over-year to nearly $640 million. Cloudflare now has 4,416 customers paying more than $100,000 per year, a 25% increase from last year. Lastly, it delivered an operating profit of $73.1 million.
Despite these impressive numbers, massive layoffs are bound to occur. In an email to workers, Cloudflare says it will reduce its global workforce by more than 1,100 employees. And it’s all thanks to artificial intelligence (AI).
“Today’s actions are not a cost-cutting exercise or an assessment of individuals’ performance; they are about Cloudflare defining how a world-class, high-growth company operates and creates value in the agentic AI era,” Cloudflare Co-Founder and CEO Matthew Prince and Co-Founder and President Michelle Zatlyn wrote.
According to the tech company, Cloudflare’s use of AI has increased by more than 600% over the last three months.
“Employees across the company, from engineering to HR to finance to marketing, run thousands of AI agent sessions each day to get their work done. That means we have to be intentional in how we architect our company for the agentic AI era in order to supercharge the value we deliver to our customers and to honor our mission to help build a better internet for everyone, everywhere,” Prince and Zatlyn added.
During Cloudflare’s first-quarter of 2026 earnings call, Prince said that he’s confident that all resigned workers “will land at other great places.”
Cloudflare isn’t the first company to lay off workers because of AI technology. Oracle, Meta, and Amazon also announced layoffs of thousands of workers to focus on advancements in AI technology.
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