Cloudflare Cuts 20 Percent of Workforce as AI Reshapes Operations

Cloudflare will reduce its global workforce by about 20 percent, affecting more than 1,100 employees, reports Reuters. The company described the move as part of a restructuring to align operations with its expanding use of artificial intelligence tools.

The internet infrastructure and cybersecurity provider said the job cuts reflect a redesign of internal processes and roles rather than a response to performance or short term cost pressures. Cloudflare expects to record charges between 140 million and 150 million dollars related to the layoffs in the second quarter.

In its first quarter results, Cloudflare reported revenue of 639.8 million dollars, a 34 percent increase from the previous year and above analyst expectations. Adjusted profit was 25 cents per share. The company forecast second quarter revenue between 664 million and 665 million dollars, slightly below market estimates.

CEO Matthew Prince and co founder Michelle Zatlyn said the company is reimagining how every team operates in what they called an agentic AI era. Cloudflare stated that its internal use of AI has increased more than sixfold in the past three months, driving major changes across teams and workflows.