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Cloudflare to cut about 20% of its workforce

reuters.com

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Re: Cloudflare to cut about 20% of its workforce

#501

Post by throwaw12 »

therealdrag0 wrote: post #319
bananamogul wrote: post #255

Earlier quoted context omitted.

"A company finds itself with surplus labor capacity due to the efficiencies in AI" That is one possible interpretation, though I don't think it's supported by any facts. A competing explanation: companies are spending a ton of money on AI in search of efficiency, and then laying people off in order to offset these investments. That's certainly what's been happening at Microsoft, Oracle, Meta, etc.

AI is a fraction of cost of an employee though right? I have an 1000$/mo AI budget which is a fraction of my salary, and most people don’t hit their limits.

Curious to know why are they not hitting their limits.

In the organization I work, things are crazy at the moment, we are drinking tokens as if we are in hot desert and 1k is barely enough for a week for some people

Re: Cloudflare to cut about 20% of its workforce

#502

Post by eis »

Interestingly NET is down 15%-ish in extended hours trading and was even down 20% at some point. Many times a stock will make a positive move when layoffs are announced.

Cloudflare is a growing company by most metrics so if efficiencies through AI were the reason for the layoffs they'd just take the boost and grow even faster.

It all doesn't check out and I think the real reason for the layoffs and the negative sentiment by the market on the news is that their revenue growth was not as fast as their expenses and they realized they overhired. Leadership doesn't want to dive too much into the red even if it would mean bigger growth down the line. They are now beholden to the near and mid term stock performance.

I've had the chance to talk to some SWEs working at Cloudflare off the record in recent months and the one concensus I heard was that there was many times some tension between the boots on the ground and the decisions from senior managment but of course nothing they could do and especially after this they'll make sure to be quiet should they remain. There seemed to be a lot of pressure to deliver features and new products but quality has been left behind which means the SWEs felt pressure to deliver while also having to deal with the ensuing issues to resolve.

Either way I wish everyone affected the best and a speedy job hunt - there'll be quite a few really good people on the market now for no fault of their own.

Re: Cloudflare to cut about 20% of its workforce

#503

Post by altmanaltman »

scott01 wrote: post #451
AloysB wrote: post #135

This is awkward. Exhibit A - September 2025 - "Help build the future" - Cloudflare hires 1111 interns to "help build the future" [ https://blog.cloudflare.com/cloudflare-1111-intern-program/ ] Exhibit B - May 2026 - "Building for the future" - Cloudflare lays off 1100 people, about 20% of their workforce to "continue building the future" [ https://blog.cloudflare.com/building-for-the-future/ ] I'll finish on this quo…

I’ve seen managers hiring people with an intent to lay them off when winds change to protect themselves and their close circle. I can only imagine they’ve had great KPIs in both cases: first for scaling the team, and then for cutting costs.

Using human resources as moat to protect themselves when the barbarians come. Seems to Management 101

Re: Cloudflare to cut about 20% of its workforce

#504

Post by altmanaltman »

matwood wrote: post #404
lagniappe wrote: post #266

Earlier quoted context omitted.

I want to agree, however, it will take every bit of that time for some to find new placement. These AI cuts aren't just making it harder to keep a job, but harder to get a job as well.

> but harder to get a job as well. I just tried hiring someone and received over 200 resumes that looked mostly fake. Thinking about adding a final in person interview in an attempt cut down the garbage when I repost.

What do you think can be a solution to this? I guess the problem is only going to grow as more people use AI, I'm sure someone out there is also using agentic workflows (basically spamming every job opening). Is the solution to use AI to filter the results or do you think that will not work out if the target is to find the best candidate

Re: Cloudflare to cut about 20% of its workforce

#505

Post by senexex »

prymitive wrote: post #9

Obviously AI is just a excuse

The level of group think here is unbelievable. Any opinion other than this is down voted immediately. A whole page of people bargaining and not wanting to face reality.

At my work, our healthcare plan renewed May 1st. We have great insurance. The CEO told us that the healthcare premiums just went up 50% so enjoy this year because it is going to be less great next year.

It doesn't matter how many people have a type of religious faith that this has nothing to do with AI and is all posturing.

The reality is AI is going to get cheaper in the future and I am just going to keep getting more expensive as an employee as we circle the drain in this health care and debt death spiral that everyone is also in complete denial of with no political will to do anything about.

S&P 500 is at an all time high. The real layoffs haven't even started yet.

Re: Cloudflare to cut about 20% of its workforce

#506

Post by kandros »

scott01 wrote: post #451
AloysB wrote: post #135

This is awkward. Exhibit A - September 2025 - "Help build the future" - Cloudflare hires 1111 interns to "help build the future" [ https://blog.cloudflare.com/cloudflare-1111-intern-program/ ] Exhibit B - May 2026 - "Building for the future" - Cloudflare lays off 1100 people, about 20% of their workforce to "continue building the future" [ https://blog.cloudflare.com/building-for-the-future/ ] I'll finish on this quo…

I’ve seen managers hiring people with an intent to lay them off when winds change to protect themselves and their close circle. I can only imagine they’ve had great KPIs in both cases: first for scaling the team, and then for cutting costs.

300% accurate

Re: Cloudflare to cut about 20% of its workforce

#508

Post by winrid »

voxelghost wrote: post #305
winrid wrote: post #293

Earlier quoted context omitted.

Should companies be forced to retain talent of a certain age group? Should they be forced to retain less competent people? How do you expect this to work?

In Sweden,the Employment Protection Act, (LAS ) mandates 'last in - first out', meaning if there are layoffs due to over-capacity, people with seniority (years of employment) take priority for available positions. This is kind of partioned by profession-group, so yes you can fire nurses but keep doctors, or other way around. (Its been a while since I looked into it, but thats the rough gist of it)

lol does all of European tech companies combined even make more than what the EU brings in from taxing US companies yet?

Re: Cloudflare to cut about 20% of its workforce

#509

Post by BadBadJellyBean »

camillomiller wrote: post #499
nostrademons wrote: post #488

Earlier quoted context omitted.

It's the natural result of "fire the bottom 10% every year". If that's the rule in your organization, and you have a core group of people that actually know the systems and get the work done, you better make sure you have 10% padding every year, lest you layoff someone important and their friends all quit in disgust. And since competence and institutional knowledge is built over time, that implies a revolving door of…

Workers as cattle. This is utterly disgusting and the way it’s normalized is even more revolting

In management terms a human and a printer are the same. Both resources that need to be managed. I hate it.

Re: Cloudflare to cut about 20% of its workforce

#510

Post by 21asdffdsa12 »

scott01 wrote: post #451
AloysB wrote: post #135

This is awkward. Exhibit A - September 2025 - "Help build the future" - Cloudflare hires 1111 interns to "help build the future" [ https://blog.cloudflare.com/cloudflare-1111-intern-program/ ] Exhibit B - May 2026 - "Building for the future" - Cloudflare lays off 1100 people, about 20% of their workforce to "continue building the future" [ https://blog.cloudflare.com/building-for-the-future/ ] I'll finish on this quo…

I’ve seen managers hiring people with an intent to lay them off when winds change to protect themselves and their close circle. I can only imagine they’ve had great KPIs in both cases: first for scaling the team, and then for cutting costs.

Company internal GDP equivalent increase of a funeral.
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