The prospect of AI-related layoffs has been the talk of Silicon Valley and Wall Street since ChatGPT launched its first AI model in late 2022. This year, a handful of tech companies are delivering on that promise. Cloudflare is one of the latest to do so.
In a Wall Street Journal op-ed published Wednesday, Cloudflare CEO Matthew Prince laid out his logic. The company is growing. Fast. It just posted record revenue growth and is expanding its global customer base. Still, Prince said the tech firm slashed 20% of its workforce earlier this month, with middle management facing the brunt of the cuts.
“The vast majority of those we laid off last week were measurers,” he wrote. He defined “measurers” as those in middle management, finance, legal, internal auditing, and revenue recognition.
Cloudflare is a San Francisco–headquartered connectivity cloud and internet security company with more than 5,000 employees as of 2025, operating on a hybrid model that combines remote and on-site work across 13 global offices.
AI-related layoffs are becoming a staple of the tech world. Jack Dorsey’s Block cut 40% of its workforce in February. Meta just this week cut 10% of workers, as CEO Mark Zuckerberg warned in a memo to employees that in the AI age, “success isn’t a given.” A recent report from outplacement firm Challenger, Gray, & Christmas found that, in total, 49,135 layoffs in the U.S. have been tied to AI this year alone, nearly as many as all AI-related layoffs reported in 2025.
But there’s a degree of suspicion among business leaders that at least some of these layoffs are the product of “AI-washing,” or reducing headcount for a reason unrelated to AI efficiencies but pinning it on the technology out of convenience. A handful of tech firms have cut back on bureaucratic bloat following the hiring craze at the end of the COVID pandemic. Andreessen Horowitz co-founder Marc Andreessen laid out that playbook in clear terms in a recent interview on the 20VC podcast.
“Essentially, every large company is overstaffed,” he said. “I think a lot of them are overstaffed by 75%,” adding, “Now they all have the silver bullet excuse: Ah, it’s AI.”
When asked for comment, Cloudflare pointed Fortune to Prince’s Wall Street Journal op-ed and a blog post co-written by Prince and Cloudflare president Michelle Zatlyn that features the email the firm sent to global staff announcing the layoffs. The email explains that the firm’s agentic AI approach necessitates the layoffs. It also outlines the severance package awarded to affected employees.
The edge ‘builders’ and ‘sellers’ may have in the AI economy
Whatever the reason, Prince said the company kept what he called the “builders,” such as engineers. That claim stands in contrast to the belief that software engineers are among the most vulnerable to AI, as the technology can code quite well, especially following the release of Anthropic’s Claude Code. He said “sellers” are also relatively safe from automation. Prince added that the layoffs weren’t about reducing headcount, but about shifting the nature of work. The company has a record number of open positions, according to Prince, in “areas that drive growth.”
A recent Anthropic study supports some of Prince’s claims about which jobs AI can automate. The study found that AI is already theoretically capable of completing the majority of the tasks associated with finance, legal, and management roles. The research also found that the technology can perform tasks tackled by builders and sellers, including completing the majority of tasks performed by engineers and sales reps.
Toward the beginning of his op-ed, Prince argued that AI’s measurement capabilities now surpass those of even the best human employees, a claim he believes makes the case for other companies to follow his lead.
“Tireless, independent, efficient and available, AI systems can now measure an organization with a level of objective detail and precision that was previously impossible even for the best employees,” he said.
