# Cloudflare beat Q1 earnings estimates, cut 1,100 employees because AI agents now do their work, and saw its stock fall 24 per cent.

*genai · news · 2026-05-08 · TNW*

## Key points

- Cloudflare explicitly attributed layoffs of 1,100 employees directly to AI agents replacing their roles.
- The internal use of AI at Cloudflare increased over 600 per cent within three months.
- Cloudflare's restructuring is not due to declining revenue—Q1 revenue grew 34 per cent year-over-year.
- Cloudflare's stock fell 24 per cent despite strong earnings, reflecting investor uncertainty about AI-driven restructuring.
- The company introduced an 'agentic AI-first operating model' making certain support roles permanently redundant.

**Companies:** Cloudflare, Microsoft, Meta, Oracle, Atlassian
**Countries:** United States

[Read the full story on TNW](https://thenextweb.com/news/cloudflare-layoffs-agentic-ai-earnings-stock)

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