Cloudflare lays off 20% of workforce in AI-driven overhaul
Updated
Updated · MarketWatch · May 7
Cloudflare lays off 20% of workforce in AI-driven overhaul
15 articles · Updated · MarketWatch · May 7
The cybersecurity company said more than 1,100 jobs would go from its 5,156-strong global staff after employee AI-tool use jumped over 600% in the March quarter.
Cloudflare said the move was not a cost-cutting exercise, expects $140 million-$150 million in charges mostly in Q2, and said the reorganisation should be substantially complete by Q3.
The cuts came alongside stronger-than-expected first-quarter revenue of nearly $640 million and 25 cents adjusted earnings per share, yet shares fell more than 13% after hours as investors reacted coolly.
As AI boosts productivity and eliminates jobs, will Cloudflare’s restructuring secure its market dominance or damage its innovative culture?
With strong financials overshadowed by layoffs, is Wall Street's reaction a warning about the true human cost of the AI revolution?