Cloudflare Lays Off Over 1,100 Employees, Shifts to AI-Driven Operations

According to Reuters, U.S. cybersecurity services company Cloudflare announced it will lay off approximately 20% of its workforce, equating to over 1,100 employees, as part of an operational restructuring centered around AI tool applications. CEO Matthew Prince stated that the company is redesigning every team and function to adapt to the era of generative AI. Cloudflare revealed that its internal AI usage has increased more than sixfold over the past three months, and the layoffs are aimed at redesigning internal processes and roles rather than being driven by employee performance or short-term cost pressures. Cloudflare expects second-quarter revenue to be around $664 million to $665 million, slightly below analysts' forecast of $665.3 million. Despite exceeding expectations for both revenue and profit in the first quarter, the company's stock price fell by approximately 19% in after-hours trading.