Cloudflare, Inc.NET

Cloudflare is building infrastructure for the Agentic Internet as the web shifts to AI answer engines.

““We delivered a stellar second quarter, highlighted by revenue accelerating to $696.1 million, up 36% year-over-year, and record growth in total paying customers, large customers, and developers on our platform,” said Matthew Prince, co-founder & CEO of Cloudflare. “As the web shifts to AI answer engines and agent-driven commerce, we are seeing a fundamental rewrite of the Internet for machine-to-machine traffic. Cloudflare sits at the center of this paradigm shift—building the infrastructure, controls, developer tools, and payment rails for the Agentic Internet. The business model of the web is changing, and no company is better positioned than Cloudflare to help define its future.””

Cloudflare plans to accelerate evolution to an agentic AI-first operating model with workforce reduction.

“market opportunity, the plan to further accelerate our evolution to an agentic AI-first operating model and the intent for the plan to align our organizational structure with this new operating model, the estimated reduction of our current workforce, the estimated charges in connection with this plan, including the primary components of such charges, the anticipated timing of the implementation of this plan and the timing of such charges, the expected benefits from this plan and related actions, and comments made by our CEO and others. There are a significant number of factors that could cause actual results to differ materially from statements made in this press release, including: the impact of adverse macroeconomic conditions on our and our customers’, vendors’, and partners’ operations and future financial performance; the impact of conflicts and geopolitical tension around the world, particularly in Eastern Europe or the Middle East, or any worsening or expansion of those conflicts or tensions, as well as other geopolitical events such as elections and other governmental changes, threats of tariffs and other impediments to cross-border trade; our history of net losses; risks associated with managing our growth; our ability to attract and retain new customers (including new large customers); our ability to retain and upgrade paying customers and convert free customers to paying customers; our ability to expand the number of products we sell to paying customers; our abilit”

Cloudflare is evolving to an agentic AI-first operating model with related workforce reduction.

“• the ongoing evolution of our business to an agentic AI-first operating model, including our use of artificial intelligence (AI) and other automation tools and resources and our related recent workforce reduction, and the costs and benefits we expect from this evolution, including the workforce reduction, and the time we expect for those costs and benefits to occur;”

Cloudflare warns its agentic AI-first evolution and workforce reduction may not deliver expected benefits.

“• The ongoing evolution of our business to an agentic AI-first operating model, including our use of artificial intelligence (AI) and other automation tools and resources and our related recent workforce reduction, may not achieve the benefits we expect in the time we expect, if at all, and could adversely affect our business, financial condition, and results of operations.”

Cloudflare reduced 20% of workforce to accelerate evolution to agentic AI-first operating model.

“On May 7, 2026, the Company announced a plan (the Plan) designed to further accelerate its evolution to an agentic AI-first operating model. The Plan reduced approximately 20 % of the Company's workforce. The Company estimates total restructuring charges under the Plan to be up to $ 165 million, consisting of $ 125 million in cash expenditures for severance and employee benefits, $ 35 million in stock-based compensation and $ 5 million in other costs. The Company recognized the majority of the restructuring charges during the three months ended June 30, 2026 and expects to recognize the remaining charges in the three months ended September 30, 2026 as it substantially completes the Plan by September 30, 2026. These charges were included in restructuring and other costs on the Company's condensed consolidated statement of operations for the three and six months ended June 30, 2026. As of June 30, 2026, the liability associated with the Plan was mostly included in accrued compensation on the Company's condensed consolidated balance sheet.”

Cloudflare reduced 20% of workforce to accelerate evolution to agentic AI-first operating model.

“On May 7, 2026, we announced a plan (the Plan) designed to further accelerate our evolution to an agentic AI-first operating model. The Plan reduced approximately 20% of our workforce. We estimate total restructuring charges under the Plan to be up to $165 million, consisting of $125 million in cash expenditures for severance and employee benefits, $35 million in stock-based compensation and $5 million in other costs. We recognized the majority of the restructuring charges during the three months ended June 30, 2026 and expect to recognize the remaining charges in the three months ended September 30, 2026 as we substantially complete the Plan by September 30, 2026. These charges were included in restructuring and other costs on our condensed consolidated statement of operations for the three and six months ended June 30, 2026. As of June 30, 2026, the liability associated with the Plan was mostly included in accrued compensation on our condensed consolidated balance sheet. For further details regarding restructuring and other charges, refer to Note 15 to the condensed consolidated financial statements in Part I, Item 1, and Item 1A “Risk Factors” in Part II of this Quarterly Report on Form 10-Q.”

Cloudflare warns its agentic AI-first evolution and workforce reduction may not deliver expected benefits.

“The ongoing evolution of our business to an agentic AI-first operating model, including our use of artificial intelligence (AI) and other automation tools and resources and our related recent workforce reduction, may not achieve the benefits we expect in the time we expect, if at all, and could adversely affect our business, financial condition, and results of operations.”

Cloudflare reduced workforce and is incorporating AI tools to evolve to an agentic AI-first model.

“We are in the process of evolving how we operate our business to an agentic AI-first operating model. As part of this evolution in our operating model, in May 2026 we announced a workforce reduction designed to better align our organizational structure to this operating model and that workforce reduction has been substantially completed. We are also in the process of incorporating AI tools and automation to increase productivity and maintain operational efficiency as we continue this evolution in our operating model. However, we may not realize the expected operating efficiencies, cost savings, or other expected benefits of these changes within the expected timeframe, if at all.”

Cloudflare is evolving to an agentic AI-first operating model with related workforce reduction.

“• the ongoing evolution of our business to an agentic AI-first operating model, including our use of artificial intelligence (AI) and other automation tools and resources and our related recently announced workforce reduction, and the costs and benefits we expect from this evolution, including the workforce reduction, and the time we expect for those costs and benefits to occur;”

Cloudflare risks that its agentic AI-first operating model evolution may not deliver expected benefits.

“• The ongoing evolution of our business to an agentic AI-first operating model, including our use of artificial intelligence (AI) and other automation tools and resources and our related recently announced workforce reduction, may not achieve the benefits we expect in the time we expect, if at all, and could adversely affect our business, financial condition, and results of operations.”

Cloudflare plans workforce reduction of 20% to accelerate agentic AI-first operating model.

“On May 7, 2026, the Company announced a plan (the Plan) designed to further accelerate its evolution to an agentic AI-first operating model. As part of the Plan, the Company expects to reduce its current workforce by approximately 20 %. The Company currently estimates that it will incur charges of between $ 140 million and $ 150 million in connection with the Plan, consisting primarily of cash expenditures for notice period, severance payments, employee benefits and related costs of between $ 105 million and $ 110 million and non-cash expenses related to vesting of share-based awards of between $ 35 million and $ 40 million. The Company expects that the majority of the restructuring charges will be incurred in the second quarter of fiscal 2026, and that the execution of the Plan will be substantially complete by the end of the third quarter of fiscal 2026. The Company’s estimates are subject to a number of assumptions, and the actual costs incurred may differ materially from those initial estimates.”

Cloudflare plans workforce reduction of 20% to accelerate agentic AI-first operating model.

“On May 7, 2026, we announced a plan (the Plan) designed to further accelerate our evolution to an agentic AI-first operating model. As part of the Plan, we expect to reduce our current workforce by approximately 20%. We currently estimate that we will incur charges of between $140 million and $150 million in connection with the Plan, consisting primarily of cash expenditures for notice period, severance payments, employee benefits and related costs of between $105 million and $110 million and non-cash expenses related to vesting of share-based awards of between $35 million and $40 million. We expect that the majority of the restructuring charges will be incurred in the second quarter of fiscal 2026, and that the execution of the Plan will be substantially complete by the end of the third quarter of fiscal 2026. Our estimates are subject to a number of assumptions, and the actual costs incurred may differ materially from those initial estimates.”

Cloudflare risks that its agentic AI-first operating model evolution may not deliver expected benefits.

“The ongoing evolution of our business to an agentic AI-first operating model, including our use of artificial intelligence (AI) and other automation tools and resources and our related recently announced workforce reduction, may not achieve the benefits we expect in the time we expect, if at all, and could adversely affect our business, financial condition, and results of operations.”

Cloudflare is evolving to an agentic AI-first operating model and announced a related workforce reduction.

“We are in the process of evolving how we operate our business to an agentic AI-first operating model. As part of this evolution in our operating model, in May 2026 we announced a workforce reduction designed to better align our organizational structure to this operating model. We expect to incorporate AI tools and automation to increase productivity and maintain operational efficiency as we continue this evolution in our operating model. However, we may not realize the expected operating efficiencies, cost savings, or other expected benefits of these changes within the expected timeframe, if at all.”

Cloudflare has AI and agents as core parts of its workforce and is embracing an agentic AI-first operating model.

““We had a very strong start to 2026. AI is driving a fundamental re-platforming of the Internet and a paradigm shift in how software is created and consumed; it's shaping up to be the biggest tailwind we’ve ever seen in Cloudflare’s history,” said Matthew Prince, co-founder & CEO, Cloudflare. “At Cloudflare, we don’t just build and sell AI tools and platforms, we're our own most demanding customer. With AI and agents now core parts of our workforce, the way we work at Cloudflare has fundamentally changed. As a result, we're being intentional in how we architect our company to supercharge the value we deliver to our customers. By embracing an agentic AI-first operating model, Cloudflare will be even faster and more innovative as we continue to help build a better Internet.””

Cloudflare announced actions to accelerate evolution to an agentic AI-first operating model.

“This afternoon, we announced actions designed to further accelerate Cloudflare’s evolution to an agentic AI-first operating model. A letter from our founders can be viewed at https://blog.cloudflare.com/building-for-the-future/.”

Forward-looking statements include plans to accelerate evolution to an agentic AI-first operating model.

“This press release contains forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended, which statements involve substantial risks and uncertainties. In some cases, you can identify forward-looking statements because they contain words such as “may,” “will,” “should,” “expect,” “explore,” “plan,” “anticipate,” “could,” “intend,” “target,” “project,” “contemplate,” “believe,” “estimate,” “predict,” “potential,” or “continue,” or the negative of these words, or other similar terms or expressions that concern our expectations, strategy, plans, or intentions. However, not all forward-looking statements contain these identifying words. Forward-looking statements expressed or implied in this press release include, but are not limited to, statements regarding our future financial and operating performance, our reputation and performance in the market, general market trends, our estimated and projected revenue, non-GAAP income from operations and non-GAAP net income per share, shares outstanding, the benefits to customers from using our products, the expected functionality and performance of our products, the demand by customers for our products, our plans and objectives for future operations, growth, initiatives, or strategies, our market opportunity, the plan to further accelerate our evolution to an agentic AI-first operating model and the intent for the plan to align ou”

Cloudflare plans to reduce workforce by 20% as part of accelerating to an agentic AI-first operating model.

“On May 7, 2026, the Company announced a plan (the “Plan”) designed to further accelerate its evolution to an agentic AI-first operating model. As part of the Plan, the Company expects to reduce its current workforce by approximately 20%. The Company currently estimates that it will incur charges of between $140 million and $150 million in connection with the Plan, consisting primarily of cash expenditures for notice periods, severance payments, employee benefits and related costs of between $105 million and $110 million and non-cash expenses related to vesting of share-based awards of between $35 million and $40 million. The Company expects that the majority of the restructuring charges will be incurred in the second quarter of fiscal 2026, and that the execution of the Plan will be substantially complete by the end of the third quarter of fiscal 2026. The Company’s estimates are subject to a number of assumptions, and the actual costs incurred may differ materially from those initial estimates.”

Cloudflare has AI and agents as core parts of its workforce and is embracing an agentic AI-first operating model.

““We had a very strong start to 2026. AI is driving a fundamental re-platforming of the Internet and a paradigm shift in how software is created and consumed; it's shaping up to be the biggest tailwind we’ve ever seen in Cloudflare’s history,” said Matthew Prince, co-founder & CEO, Cloudflare. “At Cloudflare, we don’t just build and sell AI tools and platforms, we're our own most demanding customer. With AI and agents now core parts of our workforce, the way we work at Cloudflare has fundamentally changed. As a result, we're being intentional in how we architect our company to supercharge the value we deliver to our customers. By embracing an agentic AI-first operating model, Cloudflare will be even faster and more innovative as we continue to help build a better Internet.””

Cloudflare announced actions to accelerate evolution to an agentic AI-first operating model.

“This afternoon, we announced actions designed to further accelerate Cloudflare’s evolution to an agentic AI-first operating model. A letter from our founders can be viewed at https://blog.cloudflare.com/building-for-the-future/.”

Forward-looking statements include plans to accelerate evolution to an agentic AI-first operating model.

“This press release contains forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended, which statements involve substantial risks and uncertainties. In some cases, you can identify forward-looking statements because they contain words such as “may,” “will,” “should,” “expect,” “explore,” “plan,” “anticipate,” “could,” “intend,” “target,” “project,” “contemplate,” “believe,” “estimate,” “predict,” “potential,” or “continue,” or the negative of these words, or other similar terms or expressions that concern our expectations, strategy, plans, or intentions. However, not all forward-looking statements contain these identifying words. Forward-looking statements expressed or implied in this press release include, but are not limited to, statements regarding our future financial and operating performance, our reputation and performance in the market, general market trends, our estimated and projected revenue, non-GAAP income from operations and non-GAAP net income per share, shares outstanding, the benefits to customers from using our products, the expected functionality and performance of our products, the demand by customers for our products, our plans and objectives for future operations, growth, initiatives, or strategies, our market opportunity, the plan to further accelerate our evolution to an agentic AI-first operating model and the intent for the plan to align ou”

Cloudflare plans to reduce workforce by 20% as part of accelerating to an agentic AI-first operating model.

“On May 7, 2026, the Company announced a plan (the “Plan”) designed to further accelerate its evolution to an agentic AI-first operating model. As part of the Plan, the Company expects to reduce its current workforce by approximately 20%. The Company currently estimates that it will incur charges of between $140 million and $150 million in connection with the Plan, consisting primarily of cash expenditures for notice periods, severance payments, employee benefits and related costs of between $105 million and $110 million and non-cash expenses related to vesting of share-based awards of between $35 million and $40 million. The Company expects that the majority of the restructuring charges will be incurred in the second quarter of fiscal 2026, and that the execution of the Plan will be substantially complete by the end of the third quarter of fiscal 2026. The Company’s estimates are subject to a number of assumptions, and the actual costs incurred may differ materially from those initial estimates.”

Cloudflare offers services to identify, block, and control access from AI crawlers and AI agents.

“Cloudflare offers a suite of application services products (i) to help ensure that Internet properties such as websites, applications, and APIs that are exposed to the Internet are safe from attacks, and are fast and reliable; (ii) to provide customers with the ability to build customized analytics for insights and intelligence to further optimize and secure their applications, such as monitoring for threats, understanding search engine crawler behavior and domain name system (DNS) query traffic, and analyzing any other real time data traffic; and (iii) to easily identify, block and control access from AI crawlers and AI agents and operators, a growing concern for content creators and website operators.”