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Cloudflare Cuts 20% Workforce, Shares Drop 18%

5/10/2026

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Summary

Cloudflare Job Cuts

Cloudflare announced on May 7 2026 it will cut about 1,100 jobs, 20% of its workforce, to adopt an AI-first model.
The firm posted Q1 revenue of $639.8 million and adjusted earnings of $0.25 per share, noted AI usage up 600% and $140-$150 million restructuring charges.
Shares fell about 18% after hours to near $68, wiping $6 billion in value, while full-year 2026 guidance of $2.805-$2.813 billion revenue and $1.19-$1.20 adjusted earnings per share was reaffirmed.

Summary

Cloudflare Adds Interns

Cloudflare will add 1,111 interns by end-2026 to speed AI development.
Departing staff will receive severance equal to their full base salary through 2026, while restructuring aims for completion by Q3 2026.
In Q4 2025 the company experienced two major outages that affected sites such as Zoom, LinkedIn and OpenAI.
Cloudflare handles roughly 20 % of global web traffic and saw a 600 % surge in internal AI usage over three months.

History

Historical Context

IBM’s 2011 Jeopardy! victory with Watson proved large-scale AI could outperform humans, prompting Google’s 2014 $1 billion DeepMind purchase that expanded cloud AI services. By May 2026 Cloudflare cut 20% of staff, saw internal AI use jump 600%, and its shares fell 18%, erasing about $6 billion—showcasing the continuing shift toward AI-centric business models.

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Cloudflare Job Cuts

Cloudflare announced on May 7 2026 it will cut about 1,100 jobs, 20% of its workforce, to adopt an AI-first model.
The firm posted Q1 revenue of $639.8 million and adjusted earnings of $0.25 per share, noted AI usage up 600% and $140-$150 million restructuring charges.
Shares fell about 18% after hours to near $68, wiping $6 billion in value, while full-year 2026 guidance of $2.805-$2.813 billion revenue and $1.19-$1.20 adjusted earnings per share was reaffirmed.

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