product · May 16, 2026
Cloudflare Cuts 1,100 Jobs in AI-Driven Restructuring After Record Q1 Revenue
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Cloudflare announced an Agentic Business Restructuring initiative on May 13, 2026, cutting approximately 1,100 positions or 20% of its workforce. The move follows internal AI agent usage rising 600% in three months and record first-quarter FY2026 revenue of $639.8 million, up 34% year over year. Executives Matthew Prince and Michelle Zatlyn described the changes as preparation for the next decade, with expected charges of $140–$150 million primarily in cash severance hitting Q2 and Q3. Cloudflare will reinvest payroll savings into edge inference products using Workers AI, AI Gateway, Vectorize, and R2 across 320 cities. Matthew Prince stated on the quarterly conference call that the company has never done something like this in its 16-year history.