Cloudflare has announced its first major layoff in history, cutting 20% of its workforce, or approximately 1,100 employees. This decision coincides with the release of the company's Q1 2026 financial report. This is reported by Techcrunch.com reports .
The company's management explained this move not as a cost-cutting measure, but as a strategy to leverage artificial intelligence technologies more effectively. CEO Matthew Prince noted that AI tools have increased employee productivity by up to 100 times, necessitating a restructuring of company operations.
The layoffs affected all teams except for the sales department. Interestingly, these changes occurred during a period when Cloudflare recorded its highest revenue in history at $639.8 million, a 34% increase compared to the previous year.
Management aims to redefine how a high-growth enterprise should operate in the age of AI. Despite this, the company has not yet reached sustained profitability and reported a loss of $62 million.
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