Cloudflare cuts 1,100 jobs and blames the agentic AI era

On May 7, 2026, Cloudflare announced layoffs of 20% of its workforce and blamed agents. Revenue grew 34%. Shares fell 19% after hours. The official story is the agentic AI era. The market read the guidance and saw something else. Three weeks earlier, Cloudflare had shipped its biggest agent product launch yet, which makes the timing the most interesting part.