Post Content Cloudflare employees are now using AI across engineering, human resources, finance, marketing, and other departments. The company says its use of AI has increased by more than 600 per cent in the last three months alone.(Express Image/CloudFlare)
Cloudflare recently announced one of the biggest workforce cuts in its history, saying advances in artificial intelligence have made around 1,100 jobs obsolete even as the company reported record quarterly revenue growth.
The internet infrastructure and cybersecurity company said it is reducing its workforce by nearly 20 per cent, affecting employees across multiple teams and regions. The layoffs come despite Cloudflare posting its highest-ever quarterly revenue of $639.8 million in the first quarter of 2026, marking a 34 per cent year-on-year increase.
Cloudflare CEO and co-founder Matthew Prince described the decision as part of a larger shift toward AI-driven operations rather than a traditional cost-cutting exercise. Speaking during the company’s earnings call, Prince said the company had seen dramatic productivity improvements after aggressively adopting AI tools internally over the past few months.
According to Prince, Cloudflare employees are now using AI across engineering, human resources, finance, marketing, and other departments. The company says its use of AI has increased by more than 600 per cent in the last three months alone.
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Prince claimed some employees became “two, 10, even 100 times more productive” with AI assistance, comparing the transition to moving from a manual screwdriver to an electric one.
One major focus has been software development. Cloudflare said nearly its entire research and development division now uses AI-assisted coding tools. The company also revealed that all AI-generated code deployed into its products is reviewed by autonomous AI agents before release.
As a result, the company believes fewer support roles are needed around highly productive AI-powered teams. Prince suggested that certain traditional support functions may no longer play the same role inside modern tech companies as AI becomes more capable.
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The layoffs mark the first large-scale workforce reduction in Cloudflare’s 16-year history. Chief Financial Officer Thomas Seifert said the cuts affect nearly every department except sales teams tied directly to revenue generation.
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Despite the job cuts, Cloudflare insists it still plans to continue hiring in the future. Prince said employees who effectively use AI tools are becoming significantly more valuable and productive, adding that the company could eventually grow its total workforce again by 2027.
The announcement reflects a broader trend across the tech industry, where companies including Meta, Microsoft, and Amazon are increasingly linking workforce reductions to AI adoption while continuing to report strong revenues and major investments in artificial intelligence infrastructure.
Cloudflare ended the quarter with around 5,500 employees before the layoffs took effect.
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