It is May 2026, there is no difference between AI and non-AI bills.
Most (if not all) major enterprises in the US have gone through at least one round of org-wide subscription renewals (eg: Atlassian product packs, Microsoft product packs, etc) where 1) price increases were mandatory, 2) AI features could not be opted out of, and 3) AI feature usage was strongly encouraged from C-suite to client-facing biz staff to telephone agent support staff.
I repeat, we are passed the point where AI bills and non-AI bills can be differentiated. We are all paying for these features driven by tokens whether we like it or not, whether the cost-benefit analysis makes sense, and whether they are even being used.
And we are all passing the costs onto everyone lower on the totem pole, from insurance groups to bank groups to national grocery chains to consultant conglomerates to minimum wage front-line staff to below-minimum-wage gig workers.
And this is why there are layoffs, every price increase from the top down causes further price increases to cascade down.
I've been told that a recession is coming since 2009, when I started investing - there has never been one since then despite all the dire predictions - therefore, my investments are safe
As long as you didn’t sell, and in fact bought more on the way down, you did well. Of course, not everyone’s time horizon works the timing (you might need the money and so sell at a low point), but generally, being in the market pays off.
It kind of depends what we mean. If you're conservatively in the market, invested in the aggregate economy, diversified, and what not, yes, but if you're taking bets on a smaller number of companies you can just lose your money full on. Not every single company recovers from a recession.
That's why if you are a business, the risk of a recession is a real threat. Someone will recapture your market once the recession is over, but will you?
That also means people will lose their jobs, price of goods will rise, the pressure to need to dip into one's savings will increase, forcing many people into cashing out at the worse possible time. If you are someone with that risk, as an individual, a recession is a real threat as well, and you might want to reduce your market exposure beforehand.
I've lived through both 2000 and 2008. They do happen. And typically not when everybody says there will be a recession, but when almost everybody finally agrees there won't be one.
Not that us plebs can do anything about it anyway... :(
Honestly not a bad theory. There’s definitely a huge disparity between actual productivity gained by using agentic coding done somewhat properly… and a non-stop wave of vibe coded work causing outages and churn. Pre-Covid hiring coupled with the high enterprise pricing for AI plans, it would make sense.
If you listen to people on HN you could think AI is not increasing productivity or is even having a net negative effect.
I think the reality is different.
In this thread I saw the resume of an engineer affected by this Cloudflare layoff. In the resume he claimed that adopting opencode in his workflow, he shipped an integration in half the time it took peers without AI assistance for similar projects.
I’m sitting in an airport after spending a week with a client. They’ve killed off one of their enterprise saas subscriptions with an internal ai assisted effort and are looking to kill more. Granted, they are extremely competent but software isn’t their business. There may be something to the saaspocolypse.
I've seen non-tech people building internal tooling that engineering just never had time to get to. Small/lean companies are leveling up with AI, and they aren't carrying the salary overhead of the big companies. The big companies are going to have to get that much more productive in order to compete and/or they are going to have to cut staff.
> The number of our intern goal, a nod to our 1.1.1.1 public DNS resolver, is intentional.
But like the sibling comment says, "over 1,100" does not reference any of their resolver IPs anyways. In all likelihood, they hired fewer than the maximum of 1,111 interns and they are probably chopping slightly more than that here (max vs min).
That doesn't make much sense as a distinction, though it's a fun brain teaser to see why.
CIDR subnets can be as small as /32 (an individual IP). Even in the case we take the strictest IPv4 formatting requirements (no assumed 0s and no extra leading 0s), that'd be any layoff of 1000-259999 employees. Exceptions start to appear after that, e.g. 260.0.0.0 would be invalid and there is no other valid way to group the last three 0s per the strict rules.
Say we modify the question to just /24 subnets (i.e. similar the classic class C sized subnet) while keeping the rest of the question and rules the same. Through similar logic, any press releases which round to the nearest 10 give essentially the same range, now 995-259994. Since press releases like this tend to use rounded numbers ("over 1,100" seen here), essentially any large layoff could be read as a /24.
One thing I would bet on is "If you try hard enough, you'll eventually manage to find patterns where there aren't any".
Wonder if they'll do it like they did for Brittany Pietsch. She recorded her firing video some years ago. I think it's on tiktok but there are youtube videos discussing it as well.
Anyway, new employee at Cloudflare, just finished onboarding. Suddenly a short meeting is scheduled with two people she had never met before. She is told she is let go for "performance" reasons. She kind of tears into them with "what performance issues, I only got great reviews" just to hear the HR people squirm and backpedal, well because, they know they are lying. But of course, they're trained enough to never admit it and say "they'll get back to her on that". Needless to say, it has the same effect as a suspect being arrested arguing with the cops. But it did make Cloudflare "famous" on tiktok for a bit.
I found that video and I couldn't finish watching it. TBH it's really incomprehensible to me why we've created a culture where being so heartless is praised upon.
HR doesn’t squirm because they are lying. They squirm because they minimize lawsuit surface area as much as possible. I have been on the giving end of performance layoffs in big corps and there is an extremely strict script you have to stick to (both HR rep and me as the manager).
I saw the video you’re referring to and it’s completely unsurprising they clam up further when she became confrontational. You’re not gonna talk your way out of a termination unless you have some pretty hard evidence it was for something illegal.
That’s just what getting fired looks like and people don’t often get to see the process so cloudflare “became famous”.
Most of the US is a right to work environment where a company can let someone go at any time for any reason other than the few protected class reasons. Many companies also have 90 day probationary period where they bypass internal company processes and let someone go, again other than for protected class reasons.
It's obviously hard when people's lives are upended, but no one complains when companies do a lot of hiring because the risk is lower.
It starts with some things that minimize the lawsuit area, but over time it transforms into a habit of lying. It's company policy, you know? Don't question, just execute.
The point is that HR declining to engage with her questions does not prove that they were lying. Even if they have 100% ironclad proof that they're in the right, what possible value is there in having an argument about it? Will she feel any better, and will they look any better to social media, if they deliver a 5 minute lecture on everything the company feels is wrong with her and her work?
(What is true, and what the Cloudflare CEO did acknowledge at the time, is that the manager who she felt was giving her only positive feedback should have been the one delivering the news.)
Maybe for context: In systems with worker protections, lying about this can be a crime. For example in Germany, if you want to fire someone for bad performance, you have to tell him before about the problem and give him the opportunity to improve, more than once. Even if a country like the USA, one that has nothing but disdain for the working class, does not have any such protections, the moral sentiment of non-brainwashed humans will not accept such amoral behaviour. So yes, ofc she might feel better if given an understandable reason, and yes, they might have looked better on social media, and more importantly: They might have felt better after behaving like humans.
In Germany, this woman would have been only halfway done with her 6 month probation period and the company would not be required to do these things. Again, you’re assuming without evidence that they were lying; an obvious alternative explanation is that her performance was genuinely not satisfactory, and she didn’t understand or wouldn’t listen to the feedback she got to that effect.
You would need some class action lawsuit I’d think? Need a good number of laid off people to join it and you need solid statistics that would convince a jury more than the corporate lawyers would with whatever HR covered their assess on paper have.
No I'm saying you lay off your senior people. Not because they're old and you don't want to pay retirement but to save on payroll since they make more money than juniors.
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)
Yes, and that makes working for a Swedish company so much better. You know you can’t just be shown the door at any moment after years of service and you get a lot of peace of mind which is worth more than the inflated salaries in the US. There is still a way to get rid of people, of course, but that goes a little like the Japanese do: just don’t give any important work to the person, or give them a bad performance review. People quickly understand they need to move on and they can do it with dignity.
That also means that a) it's harder for younger people to get a stable job b) the bare minimum of work not to get fired decreases over time, which is bad for productivity.
If a significant share of your employees optimise in the sense of doing the least of work possible, without getting fired, you have a huge problem anyways. Usually, given the right conditions, people have intrinsic interest in doing a good job. Even if their motivation is more of the extrinsic type, there is more to it than getting paid.
Yes, it only works in a high trust society where there’s plenty of jobs and people actually care about doing a good job (any company will have incentives, people can’t just sit around and do nothing, lots of social pressure too if you’re a slacker). But hey, that’s been mostly true (until recently, I hear immigrant unemployment is really high, while “local” unemployment is close to zero, but the official statistics sit in the middle at around 7% I think, much higher for the youth).
In my experience those people get juicy positions doing nothing useful as they their competence long atrophied due to zero pressure to keep their knowledge up to date. Of course now companies hire "consultants" to work around to issue, so those get fired on a week's notice when money is tight. The warm bodies remain in their chairs until retirement. Inefficiency remains a huge problem in Swedish economy, but no one dares to touch these archaic rules (BTW no minimal wage in a European country, WTF?) due to political reasons, so the immigrants get the blame instead for everything.
Its a choice - work hard with minimal securities, get better salary. Heck, one can do that in many EU places when working as self-employed on contract (if legal), and be paid by just billed days, no vacations or sick days. Its actually pretty good career path in the beginning of one's career in software development, get more money and ie invest in a property. Then get more secure permanent position, coast more and enjoy and appreciate more those stability benefits.
But high economic performance this isn't. Adaptability of market to ever-changing world that certainly isn't neither. Europe is getting hammered by this and things will get much, much worse in upcoming years. We will have to revisit our comfy lazy attitude towards work, or end up being a stagnant place with 3rd world salaries and corresponding QoL.
Switzerland is doing things much better, its sort of in between both extremes and economy is reflecting this very well. But EU leaders egos will sooner accept poverty than that somebody figured out things better than them.
The Netherlands recognized the problems with the last-in-first-out system and requires that after a reorganization, the statistical distribution remains the same. How well that works is hard to say because the level of unemployment in The Netherlands has been quite low for many yours.
What I hear is that Switzerland is a bad example. Many people there struggle to make a living.
The poverty line is derived from the guidelines of the Conference for Social Welfare (SKOS). In 2024, it was on average CHF 2388 per month for a single person and CHF 4159 for two adults with two children.
I live in Zurich (by far the most expensive city) and while 2388 (or 4159) would be tight (depending on housing) it would still afford you a fairly comfortable life with access to top quality healthcare and public transport. Life quality wise one could argue that poverty in CH is a better option than a middle income in a lot of European countries.
Yeah Switzerland has rather few poor people and very strong middle class. And poor ain't some US version of homeless/trailer park living, just lower income, less fancy clothes, shopping in cheaper supermarkets, less/no vacations abroad.
Outside of Zurich rentals are not even that bad. You can easily get a nice apartment for 1500.- or even less. If one is struggling financially, rents are lower e.g. in Aarau district, starting from around 1000 and you can commute from there. Spending 1000 when the median salary is around 7000 is really not that bad. Low inflation in Switzerland meant other European locations are now at the swiss level or sometimes even above.
Just for others, it seems this was already an article so it came up quickly, but for fines, not taxes.
"In 2024, the total income tax paid by all publicly listed European internet companies combined was approximately €3.2 billion. This total, which includes firms like SAP, Adyen, Spotify, and Zalando, was notably lower than the €3.8 billion in fines the EU collected from US tech giants in the same year"
China is hiring engineering talent. US is firing. Nobody forces anybody to do anything. Just pointing out the current state of affairs in the long life cycle of empire. As Ray Dalio says US is very late stage declining „financial capitalism”. While China is early stage aspiring „production capitalism”. It is not like late stage declining USSR needed as many engineers as it did when it wasnt collapsing. USA is a collapsing empire. China is growing.
So you can’t be discriminated against if you’re less than 40, but that seems somewhat discriminatory (maybe you wanted to be), but that means that you are being discriminated against, but that’s meant to be forbidden.
Yes, from a legal perspective this will always be true: in-group vs out-group. Age discrimination is a special category because everyone will be in the out-group (when young) the age into the in-group. In this case, it is probably legal to fire someone for being too young. It sounds weird, but that is not a protected class of employees.
The law is you can't descriminate against a protected class. Lots of things are protected classes, like race and religion. Old age is, but young age isn't. Clothing choices in general aren't, but if it's a religous choice, it likely is protected.
Etc.
It's kind of weird that you can fire young people because they're young, but not old people because they're old. But it's not a paradox, it's just how the system is codified.
Technically yes, IBM just got sued successfully for it.
That said they just settled the case for what happened in 2016. So you might be right and even win but that wont help you for a decade (assuming you win at all)
> You lay off 1100 who are late in their career for younger people who will work more hours for less.
Yet management always seems to miss the institutional knowledge, and experience, that also walks out the door laying off those 1,100 people 'late in their career'...
It's not possible to cram 25 years of experience into two.
> Yet management always seems to miss the institutional knowledge, and experience,
If they actually miss it they can call it back to work for triple the going rate.
They usually don't though. Those left behind have to figure it out again with whatever new tools they have at their disposal, thus continuing the great circle of corporate life.
Or corporate death if they don't figure it out in time and it is actually important. But even then, the management won't miss anything.
Most of the time, management don't even know what they don't know. As a result, entire America lost engineers and builders and now don't even know how to build rails, factories and rockets to moon.
Or phrase it as reusing exiting tech because "it is cheaper" ending in having to reinvent it because all the people who designed it and made it have gone.
IT isn't even clear that is bad - SpaceX is famous for designing rockets from scratch that are better than the old technology everyone else has been using.
That happened in the reverse way. The government fired and underpaid a lot of people at Nasa ... and Musk hired incredibly experienced people, who became experienced on the taxpayers' dime, to build a rocket, for huge payrises.
The biggest but not only example: https://en.wikipedia.org/wiki/Tom_Mueller (yes, lots of subcontractors involved, however, Nasa paid, with a bonus percentage provided by the US military)
Note that Mueller gives the payment situation at TRW, and the fact that he "wasn't appreciated" as a direct reason to go to SpaceX.
What did you think happened? Does anyone actually believe Musk did the technical design for that engine, just because he claims so? Or I should say he constantly claims it, staying slightly away from direct claims to avoid getting caught in lies (well ... getting caught AGAIN).
SpaceX has nothing to do with any part of the Artemis II crewed lunar fly-by. They were considered and rejected. It was entirely legacy aerospace contractors. SpaceX is under contract for parts of future missions including the lunar lander.
I'd imagine it's access to capital and resources. I suspect many engineers/professionals (especially in eg consulting or manufacturing) would start their own business if they have the financial stability to do so.
A lot of market forces tend to "naturally" create monopolies/oligopolies. For eg if you're the biggest steel plant you can operate efficiently and keep moderate margins, beating any plants not as big (economies of scale). An independent guy (or even the entire team) can't just open a new steel plant shop down the road, even if the current one sucks.
Haven't software engineering salaries been like 200K for almost a decade? With very little actual need in capital requirements relative to a host of industries with expensive equipment, I'd say of the class of workers most poised to start their own businesses, I'd say you guys are the best placed.
To be a bit honest, I'm a computational scientist who's never seen anything near 100K and likely never will. It's hard to imagine not having around 4 times my salary and not being able to start something myself.
It gets sucked up into housing. So if you're in your early 50s that's fine as you probably brought very cheap. Mid-40s and under? Unlikely unless you were extremely lucky. I'm 45 by the time I've been able to buy housing it has always been peak despite having very high earnings at times.
> I'd say of the class of workers most poised to start their own businesses, I'd say you guys are the best placed.
I think your premise is significantly correct; things like launch HN (and even YC startups) are heavily software biased. I suspect you'll find about a hundred product hunt products for every physical kickstarter/indiegogo.
To start a $100M software company you need 5 engineers and 5 laptops.
To start a $100M hardware company you need $500M.
Software is a tragedy of the commons situation where anyone smart enough to engineer is smart enough to learn pointers and objects instead of shear stresses and voltage fluxs.
Nevermind that software pays much more with a much lower barrier to entry.
Engineering and running a company are very different skill sets. Engineers are often not good at Marketing, networking, sales, ...
Even if you are good at those, for many companies, it's more about connections than about the ability to build stuff. So if you don't know the right people, it is very difficult to get a foothold.
Marketing, networking, and sales are the job. Or a large part of it. If you don't have connections, knowing how to make connections is part of it.
Accept that there are other skills besides engineering, and they can be just as challenging to learn, and just as opaque from the outside of you don't understand it.
I have AuDHD - there is no way I'm running my own company. I'm a good developer but I need someone else to have the idea and run the business and I can lead a small team to bring it about.
Given I'm now in my mid-50s, things are looking grim. And I'm not getting paid SV silly money. I'm not even getting paid US dollers.
That's basically the meme, right: You rail against corporations and yet you work for one. Curious.
Anyway in general, corporations are sticky. They save resources through scale and collaboration. Famously this is a problem for free market true believers because if you believe that the market is the most efficient mean of organizing people then you would expect firms to operate internally as free markets (or disappear). There is a whole body of work about it,
I don't have the link to the US census bureau in front of me, but I think as of 2018 more than 50% of employees worked for firms with >500 employees.
And, of course, there's nothing preventing a small/medium business from incorporating, either. "Corporation means big, small business is a different thing" is common shorthand but not actually how it goes.
The vast majority of people working for small companies do not earn much. A few doctor firms, and high end legal/engineering firms maybe, but most employees of smaller businesses lose out on total comp to big businesses, and government.
>If they actually miss it they can call it back to work for triple the going rate.
That’s great in theory, it rarely works in reality. Those people almost universally find new work quickly because they’re good, or retire because they can.
In both instances the idea of going back to bail out a company that just screwed you, operating with a giant target on your back when the inevitable next layoff occurs, isn’t worth it for 10x the salary. Ignoring the fact a business of any significant size isn’t approving paying someone to come back for 3x, they’ll just caN the manager for the fallout.
I've never seen evidence that companies value experience. They hire outside CEOs instead of developing and promoting from within. They move managers to new rolls all the time, and thus everyone needs to learn how to manage a new boss. My local school district did the same when the superintendent retired - found a small local school district and hired their superintendent away instead of using what should have been a pool of assistants who already have experience in local problems.
I'm not sure if it matters or not in management. I believe it does in engineering.
Lately it feels like it's possible. Freshers in their first job are now capable of taking ownership and shipping full stack features in a few weeks. The feedback loop is definitely shortened - noone appreciates the years spent "googling and looking at stackoverflow" anymore, and frankly, they shouldn't be.
Experience matters now mostly at the architecture, and decision-making levels, not at implementation.
I was reviewing some code done by a junior hire at my company last week, and it certainly didn't look like he was cramming 25 years into 2. It looked like he had no understanding of anything he had generated, because it was garbage. Meanwhile this week I've just reviewed the largest single PR I've ever seen, from a senior dev who disclosed it was mostly generated and cleaned up by him, and the code was perfectly fine and it was a breeze to review.
LLMs are a great tool, but more often than not it does show if the person using them knows what they're doing or not pretty clearly. Especially if it's anything larger than a trivial small change.
Every time i see a comment chain like this i'm annoyed. In the last 3 decades we never truly found the words to define what kind of skills, problems, and people /-space exist in the industry, and AI has literally added a whole axis to the space so we're more unable to communicate than ever.
Having said that, and feeling more with you than the other guy, there is nothing for you to "disagree" with.
Mediocre was always buggy and broken in some ways, but for all intents and purposes it was good enough. Today somebody with a year of study can reasonably deploy something - for which the appearance of taking ownership and shipping a full stack of features has reached the bar of good enough.
Consider 10 years ago: Did you believe it was more likely that in the quality-distribution-of-software that we would, over time, create proportionally more quality? I dont think so and AI didn't meaningfully change the trend.
It changed the work dynamics, and still is changing, and with our inability to communicate is going to be an annoying mess.
Dont let the annoyances blind you to what LLMs can do for your point in space, or to where most of the points lie for the rest of the world.
The problem with AI isn't that it's mediocre, I can work with mediocre. The problem with AI is that it produces absolutely stellar world-class code with two hidden 0days in it.
I can't work with that sort of surprise. I'm tuned to consistency, and I can work with consistently bad, but not with "95% absolutely amazing, 5% abysmal".
And I say this as someone who develops exclusively with LLMs now.
I am using Claude Code with Opus 4.5 and I have to correct it every day. It produces working code but it makes mistakes. The code is more verbose than it should be, misunderstands/ignores edge cases, etc. Daily.
And I am not a stellar world-class programmer. I am pretty average. I just read what it produces.
With junior programmers I typically just look for high level patterns that are commonly wrong. Sure if they are touching our cross thread communications code I need to spend a lot of time on that because it is so complex nobody gets it right - but we only have a tiny amount of that and most people look at it and run the opposite way (even me - I wrote it but I still do my best not to touch it when I can avoid it - that is hard hard hard)
I think we should care that our engineers have put the effort to understand the code they are responsible to produce. I don't care specifically about how they get that knowledge (I am using AI to learn myself, for example). But I disagree with the implicit assumption on the statement, which is, in my view, "humans don't need to understand the code any more" (because some fresh out of university might think they understand, but they really don't).
I'm not talking about some hypotethical scenario - but what I observe. When I started out, us interns were tasked with "nothing". Now the skill floor is so much higher, and I'm seeing freshers accomplish tasks that were previously thought of strong mid-level or early senior ones.
Well that is not my experience. My first task as an intern, decades ago, was performing a useful task for the company that hired me. I did a mediocre job at it and it took me way longer than it would take one of the experienced engineers there, who would have done it better. That was expected because I was an intern.
With the tools available now, I would have been able to produce things of higher quality and faster, I don't deny that. But putting that code in production without an experienced developer reviewing it thoroughly would have been reckless. And they would have been the owners of that code, not me.
> seems to miss the institutional knowledge, and experience
Or the exact opposite. Not every institutional experience is good and useful. Some are quite the opposite. I mean, term limits are one of the most common democratic institutions for precisely this reason. We WANT some knowledge and experience to walk out the door.
Laying off people with experience which only 1% of their younger colleagues will learn because LLMs made it redundant enough is misguided today. If I were a CEO I’d hold on to my 15-20 yoe engineers for my dear life; can lay them off in 2028.
>You're building the future with new fresh people instead of the "dead weight"
If the "future" being built is one that those same interns would be dropped as "dead weight" as soon as they settle into families and refuse to be exploited with overwork, then it's a bad future, even if it's one with more CDN features.
Although, instead, it will be a more enshittified one anyway: they're cheapening your company and the product and lose organizational and operational knowledge in the process.
But the truth would likely be closer to that those fired would be a mix of mostly extra people hired plus some older employees. But instead of "we hired extra X less than a year ago, we shed X now", it's rebranded as "we reduce our workforce thanks to AI" to get possitive press and appeal to the less bright small-time investors.
yes sure. its pure accounting and buying into the scam that genai+junior will reduce costs. meanwhile they tokenmaxing vibecoding uis for 50% of their wages cost. I will short every company making those moves.
You're expecting the country that's all-in on anti-vaxxing, climate catastrophe denial, and the disassembly of democracy to understand what institutional knowledge is?
Picture a space station where there's an error when trying to seal the door and they proceed anyway and it explodes from the pressure differential as all the air escapes out to space.
I worked in a company that did that. They couldn't rehire the senior after the junior burned with a bug 700k in 20 min by touching a part of the codebase no one had context for anymore.
There's an interesting assumption here that all people working at Cloudflare are great developers, and none deserve to be fired for poor code or laziness.
i saw this ALL the time at past employers. Employers higher all kinds of interns who eagerly get truck loads of work done and build great connections. and 2 years later the company is getting sold off, out of business, or mass lay offs all over the place. what's the point of highering all those interns in the first place?? geez.
>mass lay offs all over the place. what's the point of highering all those interns in the first place?? geez.
If you don't hire them, someone else can hire them. Out of 1,000 you hire, one could be an "attention all you need" research paper writer, who could set up the next stage of innovation which you'll completely miss if you do not get anyone.
Initially, you’ve got to starve out the market of talent to stop competition from growing by nipping the threat in the bud.
> Out of 1,000 you hire, one could be an "attention all you need" research paper writer, who could set up the next stage of innovation which you'll completely miss if you do not get anyone.
I have worked with people of this caliber. The company did nothing to retain them, and the company did not retain them.
Well how can they have the time or resources to invest in retaining talent? They're busy hiring more interns, where one could be an "attention all you need" research paper writer, who could set up the next stage of innovation which you'll completely miss if you do not get anyone.
I am part of Management in my company. We explicitly maintain a list of key people in the company we don’t want to lose. The truth is that just a few people are what makes a company. Lose them and you are in trouble. Some companies don’t seem to understand that, but perhaps after a certain size, it doesn’t matter anymore! The machinery just keeps turning.
I met a guy this happened to. He got a special award within the company, asked for a bit of equity, didn't get it, in fact got blacklisted and booted out.
Need to propagate a lot of dollars fast, 24/7 as a moat on it remaining a reserve currency.
99% of these software startups are basic software that can be handled by a single dev; see Reddit apps and such.
But that money printer was running hot and heavy. Needed to funnel it somewhere. Why not that favorite political cudgel of the elites; pointless busy work jobs! Let's invest in a bunch of shops nearby for them to lunch at too!
Big tech, sure, but not all the startups. I can assure you having freelanced and mentored many a SWE at 5-20 person startups the last 6 years they are not all hiring pro chefs.
Have you not been reading the headlines about urban offices empty? Low taxes to create foot traffic for other businesses?
The trickle down of the ZIRP era was about spreading all the dollars they could print as quickly as possible to maintain dominance of the dollar.
SaaS apps are meaningless to future generations. We were never creating pyramids of Egypt like wonders. We were missionaries for contemporary American propaganda.
> The number of our intern goal, a nod to our 1.1.1.1 public DNS resolver, is intentional.
Hiring and firing based on things like this should be a huge red flag.
I’m surprised they didn’t lay off 1001.
I realize those were interns, so maybe the expectation is they’re temporary from the start, but picking these numbers for marketing instead of need is silly.
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.
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 new folks coming in and most of it not making it.
Usually, companies value opex more than capex - opex is much more flexible. That's one of the reasons why printers, coffee machines, companies cars and other things are typically leased.
Not really that simple. Opex gets better tax treatment (you can deduct it in full every year) but people aren't always Opex depending on what they're doing (research tends to be Capex)
Also tax treatment isn't the only consideration for financial engineering: It's easier for a company with a huge capital spend to argue that they're investing in the future and CapEx doesn't hurt EBITDA. On the other hand, some companies get worried about reporting a high "capital ratio" (ratio of capital assets to income).
In reality you can't say categorically that companies prefer Opex to Capex.
Concretely speaking, the FAANG companies are all wildly slashing opex (us) for capex (data centers, TPUs) even as the capex costs skyrocket due to demand outstripping supply.
Programmers are usually capex to be honest, with current tax treatment. When companies switched from data center to cloud they ended up shifting a lot of their compute from capex (buying servers) to opex (paying a hyperscaler for compute by the hour).
Of course if you're in one of the five tech companies building datacenters rather than renting (MSFT, Google, Facebook, Amazon, Oracle) then things are different.
This is effective. Therefore, normalization of this plays into the workers' hands, gives them information, and gives economic advantage to honest agents.
I mean, you could compare it to any non-capitalist society, where such treatment of workers is declared unacceptable. But what does this translate into in reality? Such strategies are still effective and provide an advantage to those actors who adhere to them. But since firing workers for their relative effectiveness contradicts the proclaimed ideology, such workers are simply accused of random crimes against the country and executed.
The easiest way to become a F500 company is to start as an F5 company, then financialize your whole business, stop innovating, fire anyone effective, and give the executives huge bonuses.
This is completely acceptable. When was the last time you saw any job seeker seriously enquire about such practices in interviews or at the application stage?
A lot of people here and in the industry in general seem to optimise for compensation package and put blinkers on themselves for other factors that are definitely relevant.
Companies aren't penalised by candidates for such practices. I'm not saying it's good but it's astounding to me the number of people who for example optimise entirely for salary and then are shocked when the working conditions are very poor.
People game companies and companies will game people in return. Murray Gell Man amnesia will kick in and next week there will be thread about how CloudFlare is a great place to work for software devs because you can earn 20% more than other comparable companies with no reference to how things like job security or working conditions are measured.
Either they will answer directly with something solid like "We're growing the team" or they will evade it which is still a meaningful answer for you. You could probe further with questions like:
"How has the team's headcount changed over the last 18-24 months?"
Basically you're alluding to 'employee turnover' without saying it.
This is a bizarre take, I've always asked questions like this when interviewing, and if a manager doesn't have a good answer I ask for follow up conversations with the team before taking a job.
Has it worked out? No, but usually they were all being lied to by upper management. Can't do much about that.
I missed a word in there, which was "has it always worked out", but on the other hand I've also dated a lot of people I didn't marry, and even in my original phrasing I think it would be very odd to not ask or try to suss out this information! If nothing else you'll learn later if people are truthful or not, or worth working with again in the future.
I think we're saying the same thing? Just asking about team size won't reveal the answer. So a different set of probing questions might have to be asked.
Agree with the sentiment and this is a good idea regardless of skepticism about layoffs, but I think "we're growing the team" is not a solid answer.
This is a company that's potentially going to be giving you a lot of money. You should want to understand what they're hoping to get out of that investment. e.g. what are their short/mid/long-term goals and how does hiring you fit into that? Ideally it's clear to you that they have a lot of work they want to accomplish that seems reasonably aligned to what the business owners would want, and it sounds like something you want to get yourself into.
A great answer would be like "we've been acquiring a lot of customers lately and have been starting to run into performance issues, but we don't have the capacity to both handle that and also work on the feature requests we're receiving." Or "we're looking to expand into a new market which carries some new baseline requirements (e.g. FedRAMP) and need help building that."
I thought it was hilarious when they did their layoff a couple years ago just because everyone else was. It was portrayed by their announcement as though it was a business need that they tighten their belts, as though Apple, the company that makes twelve figures of profit every fiscal year were in some kind of tight cash flow situation. Really made it obvious that they saw the atmosphere as “good layoff weather.”
>- “Are you hiring people just to fire them a year later to protect yourselves?”
You think the naive part is the response and not that question?
My point is that you'll simply have to read between the lines on responses with leading questions not that they're going to be upfront about these things.
Also the interview isn't the only way to gauge these things, You can Google for layoff numbers as well and make determinations that way. There are some websites that are dedicated trackers of layoff announcements, both the loud and quiet ones e.g. Spotify I think were letting 29 people go per month for a while. I think the law in Europe was if was 30 people you had to announce it. I can't remember the exact detail but plenty of companies expose these loopholes.
Do they need to own up to it directly? Interviews are always about both sides of the table putting their best self forwards. If it's a big enough company to implement stack ranking and the resulting games played then GlassDoor, LinkedIn, Reddit, even HN all serve this purpose quite effectively.
You can also just ask indirect questions: "how often do you hire new team members?", wait a bit and then, "how is the company measuring growth?" and then at a later opportunity "what's the tenure of those on the team I'd be working with?". If nobody with 1 -2 years is on the team but they admitted to hiring frequently and that growth is meager or stagnant (or they can't answer the question), you have your answer.
You could also just ask directly. I think it's a totally fair question. I don't think you'd be penalized for asking about a company's layoff history. Especially if you say something like "I'm looking for my next home, somewhere I can be for the next 5 plus years".
I might not ask in the first 10 minutes of the first interview, but once you're a few rounds of interview deep, you can pretty safely ask questions like this.
> People game companies and companies will game people in return.
You have cause and effect entirely reversed.
There have literally been movies and tv shows made about employees showing missplaced loyalty to their companies and what the companies do in spite of that loyalty, and now that the pendulum has swung to around a bit, you have the temerity to suggest it's the employees who started this trend and the poor employers are just forced to play the game? Fuck right off.
I see it all the time companies keeping people out of loyalty despite employee being grossly incompetent. But it would be hard of hear about it because what kind of news that'd be.
Hiring is event, firing is event. Not hiring or firing are not the event to cover.
> This is completely acceptable. When was the last time you saw any job seeker seriously enquire about such practices in interviews or at the application stage?
To put it another way: she shouldn't have been dressed like that, it's her fault for being raped.
> This is completely acceptable. When was the last time you saw any job seeker seriously enquire about such practices in interviews or at the application stage?
Well, this is not something you can safely ask in most interviews. Also, while there's some sort of HN/hackerdom fiction that the job seeker holds some power during the interview, for most job seekers the interview is strongly imbalanced towards the interviewer. So asking clever questions during the interview is risky if you're desperate for a job.
agree - every time you ask a "clever" question you're increasing the risk it will be mis-interpreted, and also giving the interviewers a chance to pass. You may think you're being intelligent, honest or candid but it can easily come across as cocky, confrontational and (for lack of a better term) "off". I've passed on candidates for all of these reasons.
While you can't really ask "will I be layed off next year," it's pretty common to ask some version of "why is the role open," usually split among a few questions (that you'd tailor based on the role):
- "Which of my skills do you think are most valuable for this role?"
- "How would you measure success in this role?"
- "Can you tell me a little more about the product lines we'll be developing / supporting?"
- "How is the current team planning to grow?"
These are the kinds of questions that let you feel out what the manager envisions for the role. If the answers seem vague, that tells you something about the role / manager / org. If it's not clear how you impact the product and they can't clarify, that also tells you something.
I hear you, but the answers to these questions in my experience are always of the kind "we're looking to hire capable people with skills X, Y, Z for projects A & B".
These don't give you any idea about the health of the company or how precarious your new job will be.
> When was the last time you saw any job seeker seriously enquire about such practices in interviews or at the application stage?
There’s some kind of reverse-survivorship bias here. I’d never apply at Meta because their management does the “hire a bunch of excess people in the good times, so when Zuck‘s next inevitable efficiency-drive happens, the team is able to layoff lots of people while still staying operational” approach.
So I’d never make it into the Meta interview to ask that question in the first instance, and neither would anyone else who thinks of Meta in that way.
This reads to me almost like saying “Why are pigs not avoiding the most problematic slaughterhouses?”
A. We have to work somewhere, and in 2026 honestly it’s actually the employer’s market which is kinda new to me, as someone who always just passively waited until an interesting job offer fell in my lap.
B. They all pretty much work the same. Everywhere is “like a family” and “cares about sustainability” and all, until either your VC money starts to run low and you sell to PE or liquidate, or, for your big techs, layoff season comes around and you need to show that you’re willing to cut costs with the best of them, so you pick a random 4-5 digit number to lay off for the investors.
>This reads to me almost like saying “Why are pigs not avoiding the most problematic slaughterhouses?”
I don't think that's a fair comparison. Pigs are literally reared for slaughter and have no autonomy. Employees can and do choose these companies completely of their own volition.
I think you have to squint pretty hard to think that's the case in software engineering. LA Times suggests there are 6.9 million job openings (1). I don't think it's reasonable to suggest that anyone who wants a job in tech should get one otherwise its a humanitarian crisis. In fact, I'd say it's beyond unreasonable to suggest that.
Still, I do feel bad for younger folks trying to break into the industry - but "work for cloudflare or go hungry" is beyond a stretch.
Edit: Cloudflare is paying out terminated employees thru the end of 2026, imagining this is a case of people going hungry requires some very serious ideological capture.
> Cloudflare is paying out terminated employees thru the end of 2026
That's great that they're doing that, but it's absolutely not guaranteed, either in this particular case (prior to this announcement, i.e. when these people were hired) or in general.
But all of this ignores the more general point, which is that--for reasons which may or may not be their fault--some people are not in a good situation financially and for them being laid off is a big deal with very real risks. Just because that's not you doesn't mean it's not a real thing.
> Cloudflare is paying out terminated employees thru the end of 2026, imagining this is a case of people going hungry requires some very serious ideological capture
We were talking about the people interviewing and picking jobs in general, not specifically ones that had been laid off from CF.
> I think you have to squint pretty hard to think that's the case in software engineering.
Maybe not right now (though I imagine that varies a lot even now). But I've been there. I've gone from making plenty of money to 100k+ in debt and having less money in the bank than I need to pay the rent + buy food next month. Admittedly, that was after the dotcom bubble; but it left me with a mindset of not assuming everyone has a choice to work at the company they want to. Sometimes you need a job, and being picky about which one you choose isn't always an option.
Huge gulf between "sometimes you need a job" and "employees are pigs to the slaughter".
"I've gone from making plenty of money to 100k+ in debt and having less money in the bank than I need to pay the rent + buy food next month" is pretty intense. I'm sorry you went through that, but if you get ~7 months of paid time to job search and still wind up 100k in debt, there are definitely other problems. I don't think it's at all fair to characterize getting laid off from an extremely highly paid job as a humanitarian crisis.
Should tech companies hire more slowly and carefully? Yes, definitely. Does that actually help employees? I'm not sure, in this case they're getting paid more than they would have had they not been hired at all. Are there plenty of jobs available outside of software? Yes.
Though it’s ridiculous to entertain the thought that one would pivot their career at the drop of a hat. Even just bumping into a tech stack will chain one to it as recruiters stare at yoe in a specific one and completely ignore anything adjacent, imagine doing anything more radical.
One can do it, but it’s a life changing, irreversible and likely damaging event nobody sane would take lightly. Absolute nonsense.
"I don't think it's reasonable to suggest that anyone who wants a job in tech should get one"
I understand your point, but this is the least bad world we're in. If you mandated no-firing or mandated year-long compensation for laid-off workers, you would be crushing the small business economy and destroying more jobs than you were trying to save.
Most job openings are fake. Ghost jobs are a real and growing problem as dishonest businesses use it to signal growth without the actual intent to hire.
> LA Times suggests there are 6.9 million job openings
Yeah sure. I've seen literally dozens of job openings in certain companies that match my resume pretty much perfectly. None of them ever bothered to respond when I applied beyond "nah, better luck next time" (even that is not guaranteed, some just ignore you). I have no idea what those millions of job openings are, really, but the fact is, when you're out of a job, you don't feel like you have millions of employers lined up to invite you. Especially after you spend a couple of months submitting resumes and getting no interviews.
> Cloudflare is paying out terminated employees thru the end of 2026
This is pretty generous, usually a couple of months is all you get, sometimes people don't get even that. With that kind of approach, working for Cloudflare becomes even more decent option, comparatively.
I hope people don’t gaslight you into thinking it’s something wrong with you. That was exactly my experience this year - and that’s completely new compared to 4 years ago. It’s the market that’s changed.
No, I have been in the field long enough and done enough things that I know I maybe not the best ever, but I am pretty good. I appreciate the kind words though. And I am lucky to have a good job too, now. But that's what happens in the field, and it's not only me - I have heard the same you are saying from multiple people over the last years. It's just how it works now. Maybe there is some super-elite level where you can just sit on your Herman-Miller throne and the unicorns come and bow to you and beg you to take a job with them. I know I am, while being pretty good, not at that level. And many, many other people aren't either, while still being pretty good. All those people don't always have a luxury of refusing a well-paying job just because they get a slightly wrong vibe about what could happen with the company years from now.
What criteria would you use? Companies that don't do mass layoffs excludes all big-tech. What makes you think that "seriously inquiring about such practices in interviews or at the application stage" will get an honest answer?
Maybe the answer is that choosing 'big tech' implicitly prioritizes salary over stability. Many people (even on HN) work at places other than FAANG (or whatever counts as big tech these days).
I dunno, treating people with cattle kind of feels like the less good option here. These people who get hired have their own life, with plans and outlooks and what not, and basically hiring someone just to have someone to fire later, feels really shitty and flat out ignoring that they're human too.
It's the other way around. Why do employees try to game the companies in the first place? Because most, or at least a very large portion, don't give a shit about their employees.
It's not just cloudflare. Amazon had been doing this shit forever (probably decades at this point), to cite an egregious example. As a mere mortal employee, its not like you have a lot of choices.
> lot of people here and in the industry in general seem to optimise for compensation package and put blinkers on themselves for other factors that are definitely relevant.
This strategy basically puts you in the top 5% earners though.
No, it's psychopathic. Please, let's not pretend multi-billion dollar companies and your average worker are on anywhere near even footing. Companies always make a big song and dance about being great places to work. Nobody tells candidates 'you'll be expected to work 60h weeks to keep up with the workload here'. Candidates don't ask pointed questions about this because they'd be immediately disqualified. I know, I've been there.
The only company I know of that's open about their practices is netflix, and they comp appropriately for the risk. All other companies? It's basically word of mouth.
> Companies aren't penalised by candidates for such practices.
When you have a mortgage to pay and a family and a COBRA package running out (in the best case), your willingness to "penalize" a company that is actually willing to pay you decent money gets progressively lower as time passes. Not everybody has FU money and can refuse all offers until an ideal employer shows up on the horizon.
It feels like it was the most beneficial implementing better decision making mechanics by replacing manager with AI, not lowly folks doing actual value creation.
LLM models have better reasoning abilities than these folks....
They are not as good at building an old boys/girls network though who help each other into positions of power and wealth. Companies within companies...
Back in the late 90s a senior Microsoft exec explained this to me, they had acquired staff and continued to operate entire divisions which he described as "ballast". In the future, once the stock price increases slowed, they would be heaved over the edge of the balloon basket so that it could continue to rise. I often think about that.
Or on Amazon elastic filesystems... create giant files just to ensure you're in the right performance class for the files you do need (that was the official way of doing it for a while!).
Genuine kubernetes scaling strategy: add a do-nothing container that runs with a lower priority than your real workloads, that requests half a machine’s worth of mcpu.
When you deploy a new container, and all your nodes are fully allocated, that low priority container will get evicted, and your container will immediately get scheduled in its place. Then k8s will try to find somewhere to put that half-machine container. If it finds somewhere it fits, it’ll schedule it. If not, it’ll trigger your cluster auto scale to add a new node where that task can run, making sure the next container you want to deploy has some readily available capacity to drop on to.
old defence against unreasonably demanding manager: add deliberate pockets of slow processing as insurance so that when things get too hot about performance, you unclog a few of those to acquiesce management.
I know a medium sized defense contractor that ultimately had to sell itself a few years because they did this.
They would come recruiting in bulk at our school only to fire the majority within a year to satisfy their stack ranking nonsense.
10 years later, the engineers they were protecting retired and they couldnt find anyone willing to work for them, even people still in school knew the reputation.
I know 4 people who’ve worked for them, two on the same team, one who’s moved around various offices over a long period of time, and one who used to work for me but left to go there (and with the offer they were made I absolutely don’t blame them - we’d been hit hard by COVID and were in the midst of a salary freeze).
The first three of those people seem to have got on well there and mostly enjoyed it. The fourth had a miserable 8 months. Their manager was based in a different office with a 5+ hour time difference and was a complete nightmare, and they left of their own accord to another job on about the same money but without all the extra hours, stress, and terrible management.
I’m guessing Amazon is like other big companies: the quality of your experience will depend to a very large extent on your manager.
Well FAANG is now MANGO and yes Amazon dropped out of the top tier of tech companies on the market per these acronyms. Theres a few others other there gaining popularity which also now exclude Amazon as a top tier tech company.
Amazon is successful on the boring utility stuff (logistics, building data centers) but is broadly seen as unable to execute on higher value add things, which keeps it out of the top tier. The AI misses really highlighted that.
I've worked with some Amazon fanboys who'd rave about being "bar raisers" and other assorted nonsense, trying to impress Amazon-derived "leadership principles" upon much smaller organizations. It left a very bad taste in my mouth.
I took one of those seasonal hire to fire Amazon roles, having thrived in Apple engineering for many years, and not needing to work really at all.
It was laughable that the manager thought he could brainwash me (who used to report one level away from Steve Jobs) into learning how to write code, etc. He was from country X and would protect another wildly inappropriate employee also from country X despite her being a geography graduate in an SWE role, I'd have to teach her, then she'd report to him she taught me what i know.
Unbelievably corrupt org, but amusing i had to admit. it wouldn't be amusing if i had been dependent on working there.
Just want to point out that relational nepotism is human nature.
It basically needs to be brainwashed out of people in childhood to avoid having it happen, regardless of where they are from.
There is nothing wrong with relational nepotism in a vacuum, and also nothing wrong with brainwashing it away. Whether or not to brainwash it away is a cultural choice with tradeoffs in both directions.
That being said, IMO having a host culture brainwash it away in its own people while simultaneously welcoming outsiders from cultures without such brainwashing is very, very, very foolish. We either need to let everyone do it, or forcibly make everyone stop doing it. The current situation is ridiculous.
This is so ethically and morally odious I struggle to find the words to describe it.
I’ve managed people out. I’m sure I’ll have to do it again. I’ve even let people go during probation but, on the rare occasions that’s happened, I’ve seen it as a failure of the hiring process.
People have families, they have mortgages, bills to pay, and a powerful need to eat (Mal, Serenity?). The last thing I want is for someone to give up a stable job that allows them to do that to come and work for me only so I can fire them and leave them up the creek a few weeks or months down the line.
Our employees are after all people, human beings.
As I result I skew picky during the hiring process: if there’s any doubt there’s no doubt kind of thing.
On the opposite direction (but compatible overall view): if I think a candidate is marginal/on the bubble of passing, I’m much more likely to move forward with them if they’re unemployed.
Someone unemployed might be a little rusty (and thus get estimated slightly worse in the interview) but, more importantly, if they come in and flame out, they’re not worse off for the experience or at least not as much as if they gave up a stable job.
> People have families, they have mortgages, bills to pay, and a powerful need to eat (Mal, Serenity?). The last thing I want is for someone to give up a stable job that allows them to do that to come and work for me only so I can fire them and leave them up the creek a few weeks or months down the line.
Literally none of that is the employer’s responsibility. It’s just a business transaction. Having sufficient savings is the responsibility of every adult, never their employer. It is not the employer’s job to manage the employee’s cash flow.
Everyone, but ESPECIALLY those making six figures in tech, should have a six months of expenses savings account in cash SPECIFICALLY for this exact scenario. There are a million ways you might be without work for 2-4 months. It’s not an employer’s fault (or responsibility) that their employee is financially irresponsible.
Only if they are being honest. Offer this as a 12 month temp contract with possibility of continuation. Offering a role as permanent but with unvoiced intent to let go, that's dishonest. Being honest is always a responsibility.
A LOT of people don't make enough money to put away 6 months of savings. You can be the most financially responsible person in existence, but if you don't have the money, you don't have the money.
Then COVID happened and employers didn't have 2-4 months of savings built up, and ended up shuttering due to lack of money immediately.
Also, since post COVID, we've had hyper inflation and a locked up housing market. $150 townhomes that a $50 family salary could afford are now going for $300. And rent has gone up to match.
I don't think the numbers not matching is because of anyone's personal financial responsibility. It's more from the Fed's and Congress's horrible actions over the past 2 decades and their financial irresponsibility.
Granted, grumbling about the powers that be doesn't solve the problem, which is why I fear civil turmoil will be here very soon.
Or it was a combined strategy - hire interns who will hopefully be able to replace some higher paid employees at lower cost once they learn the ropes. Then reduce headcount further replacing with AI.
This (from the September 2025 post) now evokes the Curb theme:
> Like you, we have seen numerous reports that more and more firms are capping their total headcount in favor of leaning on more AI tools, leading to downsizing their intern and new-graduate hiring. This is resulting in increased sidelining of new college graduates. But we think this misreads the moment completely, so we’re heading in the opposite direction.
> While we are excited about what AI tools can help do, we have a different philosophy about their role. AI tools make great team members even better, and allow firms to set more ambitious goals. They are not replacements for new hires — but ways to multiply how new hires can contribute to a team.
This is the predominant (public) talking point. And it’s true.
But along with that: when you have effective people becoming even more effective with AI, it becomes glaringly obvious who the INeffective people are. At which point it becomes hard to justify keeping those people around.
(That often includes people who are otherwise effective but aren’t utilizing agents and are therefore losing their edge.)
Before AI, it was impossible to measure productivity. Some tried with misguided metrics like lines of code added but that just incentivized writing obtuse code.
Impossible to measure in absolute terms but I think it's clear productivity increases relatively when LLMs are used. At least that's my strong experience.
Quality matters as well as speed though: reworking comes at a cost, so you really need to be tracking more than one metric. A lot of problems are caused by optimising for one metric above all else.
Stuff just gets done, I guess? Projects move faster, people onboard faster with less intervention, etc. The speedup seems noticeable enough that it doesn’t need precise measuring.
Training can be socialized by asking people to take govt loans on further education and then letting the people default on them. Why should company spend their profits on it? /s
That to me is a pretty clear reason to question the accuracy of those two claims. Insiders are saying that even people who were performing well in very profitable groups are being cut, which is hard to square with the stated motivations.
It's important to say a large layoff isn't performance related, because it helps those who got laid off find new work. Even if it was all performance related, you want someone else to hire your former employees.
And, in a large layoff, it's likely to be at least partially true. Large layoffs work better when they're done quickly, when there's signs of layoffs but no information, many people will head for the exits themselves... which helps your headcount numbers, but ideally you want to keep people who are good at figuring stuff out and taking appropriate action and instead they've left. So... lay off people who are 'known performance issues', but also lay off some whole teams that have a mix of performance, and then do some random assignment and catch a mix of performance, because getting direct managers involved to pick who goes means having too many people know about the lay offs.
> This is NOT a cost cutting exercise.
Yeah, this one isn't credible. If it was about something other than costs, like pivoting to a new market, you would offer first choice of jobs for the new market. Even if it's look at our productivity, 20% of our employees have nothing to do, it takes a lot of spin to say not paying them to twiddle their thumbs is something other than cost cutting.
Didn't a few large tech companies fail even that low bar of decency? I seem to recall news of layoffs in the not too distant past where the employer openly let it be known those chosen were chosen for performance reasons, e.g. https://www.cnbc.com/2025/01/14/meta-targeting-lowest-perfor...
I think this sends a clear message. And the message is this: "Don't work here! You will be f*d! Soon!"
(it also sends clear message to the clients: you will have to suffer through the cheapest to run AI agent in case of troubles, because yes, we care the most about Wall Street guy's income, not anyone else's, we save money on everything else anytime, even when we don't have to)
> Cloudflare aims to hire as many as 1,111 interns over the course of 2026. […] That’s why this significantly increased class of interns will have a special focus: to ramp up the creative and widespread application of AI with a fresh approach.
vs.
> The way we work at Cloudflare has fundamentally changed. We don’t just build and sell AI tools and platforms. We are our own most demanding customer. Cloudflare’s usage of AI has increased by more than 600% in the last three months alone. Employees across the company from engineering to HR to finance to marketing run thousands of AI agent sessions each day to get their work done. That means we have to be intentional in how we architect our company for the agentic AI era in order to supercharge the value we deliver to our customers and to honor our mission to help build a better Internet for everyone, everywhere.
Seems no CEO simply wants to say the company is under performing, we hired too many people, and now we’re resetting. But it’s clear that’s what happened on nearly all these layoffs.
None of these announcements provide any convincing evidence that AI is anything more than a convenient distraction from the real reasons for the layoffs.
First politics. Now businesses. This sounds like a wildly poorly written parody by teenagers.
"reduce Cloudflare’s workforce by more than 1,100 employees globally."
Are they 1) halting all the 1111 interns, 2) keeping the 1111 interns, now armed with AI, to replace mid-level/senior institutional knowledge or 3) a mix?
This seems to be the new normal in Big Tech. They regularly announce massive layoffs, but if you look at their size over time it stays stable or grows. Cloudflare size grew every year. Microsoft size was stable for the past 4 years despite all the layoffs. Google had lost some (4%) employees in 2023, but has grown back to 2022 size last year. Meta shrunk by 22% in 2023, but has been growing in size since then and is probably back to 2022 size right now.
These companies overhire and then downsize. This is covered up by the moronic narrative about AI.
Side note. You know who is steadily shrinking, though? Intel. Wild, eh?
> Google had lost some (4%) employees in 2023, but has grown back to 2022 size last year. Meta shrunk by 22% in 2023, but has been growing in size since then and is probably back to 2022 size right now.
Google's revenue in 2022 was $282 billion, in 2025 it was $402 billion (43% growth).
Meta's revenue in 2022 was $117 billion, in 2025 it was $201 billion (72% growth).
Surging profits paired with flat employment continues the concentration of wealth.
> You know who is steadily shrinking, though? Intel. Wild, eh?
Intel's revenue is falling ($63 billion in 2022 vs $52 billion in 2025), makes sense that they would trim headcount.
> This seems to be the new normal in Big Tech. They regularly announce massive layoffs, but if you look at their size over time it stays stable or grows.
Periodic layoffs always happen at all big companies.
I think it’s only surprising to people now because it’s being tied to the AI worries at the same time where we’re exiting an unusual period where layoffs all but stopped for a few years after COVID.
The layoff sizes are also larger because there was so much overhiring in those years after COVID. Some rebound effects in play.
Interestingly, at least on my browser, the bottom of the Y axis is not consistently zero from chart-to-chart, which distorts the message being conveyed by these charts.
I wish tech companies would start building great products again, rather than trying to build the future. I've kind of had enough of Tech's vision of what the future should be.
This paragraph from September 2025 didn't age well:
Like you, we have seen numerous reports that more and more firms are capping their total headcount in favor of leaning on more AI tools, leading to downsizing their intern and new-graduate hiring. [...] But we think this misreads the moment completely, so we’re heading in the opposite direction.
Also how EMs in amazon construct hunger games. Just hire a person every now and then so they can let go of another to prove you made your team better on some non-sensical performance evaluation axes..Cue the hunger games.
> The packages for departing employees will include the equivalent of their full base pay through the end of 2026. Healthcare coverage is different across the globe, and if you’re in the United States, we’ll continue to provide support through the end of the year. We are also vesting equity for departing team members through August 15th, so they receive stock beyond their departure date. And, if departing team members haven’t hit their one-year cliffs, we are going to waive those and vest their pro-rated equity through August as well.
The announcement reads as pretty heartless to me, but this is a very, very nice departure package
They have a reputation to maintain, otherwise it will be difficult to recruit the best people in future. That being said, damn, that is a very generous package by any measure.
First packages tend to be the best. If you work for them beware, the next round won't be as good (if there is one). The economy isn't the best, but if you get an okay job offer anyway you should probably take it rather than risk you will be in the next round that is worse.
Dont' get it twisted, anyone; plenty of companies have a reputation to maintain for this reason (but don't do this). This is an absurdly generous severance package.
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.
This isn’t my experience, but I think it depends highly on the segment. We have mainly senior C++ devs (database company), and it’s still a challenge to find great engineers.
I think the current job market isn’t “one size fits all”. Having said that, obviously if they’re getting laid off, they may very well be in the segment that’s less desirable.
I've got a couple of friends that left London to go back to Poland during covid. They first continued to work remotely, but ended up switching to Polish companies because the pay was better.
Yes I think salaries are still a bit lower, but the gap has closed a lot. And cost of living is lower in Poland plus there is some tax break for self employed contractors that means you only pay ~20% tax compared to ~40% in the UK.
With those two factors you could easily end up better off overall, especially if you have kids
The kids factor is even bigger if you move back close to relatives. The ability to drop your children at grandma's instead of paying for childcare is an easy 1k a month you're saving.
Daycare is completely free in Poland since 2024 (you need to submit an application to ZUS, but there are no limits, it's always accepted), even the private ones.
You only pay separately for food (10 zł per day the child is actually attending to the daycare).
I switched from a Polish company to a German one (both remote), but my pay is more or less the same.
The difference is that in Poland to get that money I have to be a "top performer" with a lot of stress and not a lot of time, while in Germany I can be just a mid dev.
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.
Use a good recruiter to do the dirty work for you, it’s not cheap but it’s worth the lack of hassle.
With that said, at my firm we switched to using an in-house non-technical HR recruiter using nothing but a LinkedIn Job listing and the results are exactly as you’re experiencing. Perhaps 1 in 100 is a real human with a real resume, the rest are AI being fed our job description to generate a resume.
Onsite final interviews and technical assessments are our stop-gap.
I’ve considered writing informally and putting subtle typos in my cover letters, for example, to signal humanity. Is this a good idea or do recruiters look down on it?
You can't, this is the issue with an extremely unregulated industry. You want to stand out as a single individual among 10,000 similar qualified people on paper? Good luck.
This is likely an unintentional, but beneficial, side effect in thwarting labors power.
Since workers have a hard time getting interviews due to AI slop, that means they'll have a harder time developing leverage rather than being forced into accepting any job because the alternative is to become homeless and die.
The people I hired in my last round, with over 600 slop and fake applicants, had honest and informal cover letters that stood out. I’m sure I passed up on real decent people as a result, but there’s no perfect way to avoid this right now.
It helps that we have something closer to a lifestyle business, where I can ask for a brief paragraph about your relationship to the outdoors and cycling, but that just means I had 500 slop cover letters gushing about cycling. The three that made it through were short concise honest and linked to real world activities they did.
Good luck, it’s a hard problem , and very very adversarial. You have true scam level applications from North Korea and India, and you have unqualified people trying to appear qualified. Sprinkled in are unqualified people who would be a good hire because of raw capability, and qualified people who are looking to do bare minimum.
I'm glad I read this. Pre AI, I've always wanted to tell the company about myself using my own language instead of this fake corporate LinkedIn style language, which seemed like was the norm, and was expected. Now it seems like employers are looking for some hint of humanity. I guess I'll remember this if I ever decide to apply for a job again.
It’s hard to say because I’m not the recruiter nor am I or HR staffer.
Historically, typos on a resume are immediately filtered out. Lack of duty to care or some such.
We have some type of tooling to filter out obvious AI slop writing. We also check your submitted social media, not for offending content, but to make sure it’s been around for some number of years, especially pre-AI.
We’ve had folks spam both our hiring manager and Senior+ level staff begging for a leg up. We turned them down.
To honest answer is the hiring market sucks for all involved and there is no good answer here other than be honest and organic and pray. I wish I had a better answer, but it’s a hirers market. We can afford to be picky and lose a good candidate.
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
For better or worse, it isn't a company's job to pay laid off employees until they find a new role.
The industry standard for severance is 1-2 weeks pay per year at the company, paying out roughly 7 months is a big deal (and yes, an acknowledgment of how rough they know the job hunt will be).
Are smaller tech companies also commonly doing larger severances? I've only been laid off once and its when the company was basically out of money, but my understanding was always that it was only FAANG and similar that considered larger severance packages.
Maybe it should be the companies job, being jobless in the US is a potential death sentence and since we don't have universal healthcare, universal childcare, or universal higher education/vocational training the onus should be forced on the companies to provide welfare for workers since they are so adamant about not paying taxes to create a welfare system that doesn't mean homelessness or death.
There is also no industry standard for severance, it's not federally mandated and not a guaranteed benefit.
I'd be very hesitant to throw out so many of the fundamentals that made America into what it has been for the last couple centuries.
The goal, at least here, is to expect individuals to mostly take care of themselves rather than depending in the state or some other authority to do it for them.
Universal healthcare, guaranteed indefinite severance, universal childcare, etc are completely antithetical to our system. Maybe the majority is ready and willing to throw that old system out, but if so we need to do it by focusing on the fundamentals rather than getting distracted with higher level implementation details.
> Universal healthcare, guaranteed indefinite severance, universal childcare, etc are completely antithetical to our system.
I don't see how that follows. How is your system that different from e.g. the UK, which manages to have all of those things (severance is not indefinite and is unemployment).
Unless I'm drastically misinformed, the UK is dealing with a mountain of issues including immigration, economic problems, and quality of the healthcare being provided.
First of all, are those problems you would say do not exist in the US?
And if that's the case, I'd disagree. But would any of those problems be somehow explained by the differences between the British and American systems? Especially when countries with very different systems (like all of continental Western Europe), and the US, have then too.
Many (all?) of those problems do exist in the US as well. My point, though, was that the US was historically based on ideas that don't align with welfare programs. I only raise the issues in the UK because you were comparing the two and it seemed important to note that though the UK has many welfare programs, it isn't going well for them currently.
Toy original point, the US was based on individual freedoms and rights that simply didn't exist in the monarchical UK system. For much of the US's history the, albeit politically idealized, expectation was that you come here and make your own way. We didn't have a feudal system and didn't depend on a monarch to run many details of our daily life. We have seen more and more of that creep into the American system over the last century or so though, and yes we are coincidentally also running into many of the same issues seen in more socialist European countries today.
> We didn't have a feudal system and didn't depend on a monarch to run many details of our daily life.
Neither were the British by the time the American revolution started.
I don't see much difference in the personal opportunities and rights between post-independence US and industrial Britain. Apart from, you know, the US having slaves with no rights nor opportunities.
Yet people risk their lives to go in illegally. Something doesn't track.
Its because, inequality is not the problem.
The problem is the ability to move between income levels. That coefficient used to the highest in the US. Rich people could and did go poor. Poor people could be rich.
That index was always the highest by far in the US, but now its decreasing. That's the real issue.
I don't think it should be the companies job, but I would be ok with it being paid for by taxes companies pay.
Requiring companies to do all of these extra things just gives larger companies more and more advantages, since they have an economy of scale to provide go government-type services.
I don't want my company to be in charge of my whole life. Let them pay taxes to a government that can provide those things equally for everyone.
What's the difference in it being a responsibility of the company and it being a program paid for by races paid by companies?
I mean this as a genuine question, in case that isn't clear. To me the latter is just socializing the cost across multiple companies, but I'm happy to be wrong here.
Depends on what you specialise in. Sysadmins seem to be in demand (which isn't a programming job but is in tech still) and embedded hasn't been killed by AI yet (and I doubt it will)
> however, it will take every bit of that time for some to find new placement.
Isn't this another way of saying the severance package is generous enough to cover the time needed to find another job even in a down market?
If a severance package that covers the time needed to find a job isn't enough then it's starting to feel like we're being angry just to be angry. I don't like layoffs either (I've been laid off before) but if a company is giving 7 months of severance on what was already a very high paying job, that's very good.
Damn. I got two weeks notice and then got shown the door with nothing. And now I get to compete with all these people who are going to be so much less stressed
Proper layoffs require at least 60 days of notice or 60 days of pay. Maybe you weren't part of a proper layoff, but if you think you were, check out the WARN act.
The WARN Act is triggered if there is a mass layoff of at least 50 employees (excluding PT) and that number represents at least 33% of the active employees at a single employment site
OR, if RIFF means closes location (with 50+ employees affected).
"We are our own most demanding customer. Cloudflare’s usage of AI has increased by more than 600% in the last three months alone. Employees across the company from engineering to HR to finance to marketing run thousands of AI agent sessions each day to get their work done. That means we have to be intentional in how we architect our company for the agentic AI era in order to supercharge the value we deliver to our customers and to honor our mission to help build a better Internet for everyone, everywhere."
As an English enthusiast, I'm getting very frustrated at how the language is consistently abused in executive communications to write words without saying anything.
The implication that is NOT said is that suddenly 20% of people were sitting around without any work to do because AI was making everyone so efficient and productive. This does not, however, seem to be the reality, based on conversations within the company. It appears we have yet another case of economic downturn disguised as increasing velocity.
Which part of that sentence was confusing? I found it perfectly clear. Their internal AI use is exploding, which is a signal that they need to structure for that, and so they’re laying people off as one of the first steps towards actioning that signal.
Nowhere did they indicate there is less work to do, in fact quite the opposite.
> Their internal AI use is exploding, which is a signal that they need to structure for that, and so they’re laying people off as one of the first steps towards actioning that signal.
I don't see anywhere where the jump from "structuring for AI" directly leads to "laying people off", unless "structuring for AI" means there is less work for people to do, do you?
Noone knows what the correct structure for this new world looks like. We’ll see what they end up hiring for. But it’s fairly standard to lay off a bunch of people and hire new, rather than retrain, when you need to restructure
Not really. This is all so new, noone is using it correctly, because noone knows how to yet. We’re all just kind of flailing our arms around with it, but it’s clearly a force multiplier and its increased use is an actionable signal
The sentence is not confusing, the sentence doesn't mean anything. There's nothing confusing about it, but there's no information either. "We're making great strides in AI" and "We need to cut 20% of people" are simply two statements without any connection aside from the fact that they are next to each other in the sentence.
Enlighten me then as to the secret meaning behind the words used to communicate in the language we call English. Saying that AI is really transforming the company is fine. Saying that 20% of staff need to be laid off is fine. Those are understood terms. How do they relate? There's no explanation. Did cost need to be reduced? Did those people no longer add value? Was there certain projects that weren't profitable? Nothing is explained because meaning is avoided.
> "We're making great strides in AI" and "We need to cut 20% of people" are simply two statements without any connection aside from the fact that they are next to each other in the sentence.
Huh? How is it not connected? More productivity means fewer people are required. I'm not sure how you are not able to connect these obviously connected statements.
There’s an optimal number of employees required at any productivity point.
Why don’t Google hire 3 times the number of developers? They have the money right? What’s your logic for not hiring more?
Hiring and firing people aren't symmetric actions.
They're asymmetric because hiring more people costs more than just the salary. For example, some folks' entire jobs are to recruit and hire people. Once they are hired, you have to onboard them, etc. So the more you hire, the more you have to pay the folks with supporting roles (either directly or by way of them not having infinite time/capacity).
Firing people isn't free, either. It comes at the cost of bad PR and severance, but the latter is voluntary and calculated by the company, and the former is quickly forgotten by anybody that matters to a publicly traded company (investors).
That means not hiring those two people in the first place is usually cheaper than firing them later.
To the original point: Cloudflare isn't hiring fewer people; they are firing people. If they are trying to grow (like every single investor is counting on them to do), then why would they fire people (the cheaper action) now when they would likely need to hire people (the more-expensive action) later in order to meet that increased growth?
The charitable answer would be that the people they are firing were deemed unable to adapt to using AI for all of this supposed increased productivity. But Cloudflare aren't saying that. In fact, they're saying the opposite by stating it's not about individual performance.
your's is a caveat against my larger more correct point: there's an optimal number of employees needed at any given productivity point.
its true that hiring and firing are asymmetrical, and CF has shown that they are willing to bear the brunt of the asymmetry and fire people despite the downsides.
that asymmetry lies doesn't disprove the original point: cloudflare simply doesn't require the _same_ number of people to work for them with AI.
if you disagree with this then you believe that companies should only have monotonically increasing number of employees which is quite ridiculous a claim
Of course it's a lie. Cloudflare is saying, essentially: "AI is making us so profitable that we've decided to reduce our profit by 20%, to keep it reasonable."
Look at the chart of their stock price over the past couple of months. There was a huge run that started literally just over a week ago. Even after this 20% drop, the price today is only slightly below where it was before that run.
Their stock price has been pretty volatile for a while now (6+ months), so even with a swing of this magnitude I don't think it's valid to see it as much more than a correction.
But they’re not profitable? They make 450k per employee revenue, but lose 17k profit. Meanwhile they spend 470 million in stock based compensation for example, up 100 mil from year before, on 5k employees, which they’ve been increasing a lot every year.
I am confused by this post. No trolling: You wrote "reduce". Did you mean to say/write "increase"? If you layoff people to reduce costs, then your profitability should increase.
Firing people because they became more productive with AI does not really make sense. If productivity went up, the company should be able to ship more, support more customers, or grow faster with the same team. This sounds less like an AI efficiency story and more like a funding or cost-control story dressed up to keep investors calm
"We’re basically using our own staff as guinea pigs. Our AI usage has spiked 600% lately, mostly because everyone from HR to marketing is leaning on bots to do their actual jobs. We’re forced to restructure the whole company around these agents just to keep up with the hype, hoping it actually helps us ship something useful and justifies the "better internet" PR we keep pushing."
I will reply here assuming that you posted with good intent. I think that their PR statement is reasonable from an investor perspective. Try to detach yourself from the personal effects of layoffs. In short, they are saying: Thanks to AI, we don't need as many people to run our business. It is pretty clear to me. Sure, you can be angry about the layoffs, but the economics are clear: AI is increasing profitability faster than the business is growing, so they are using layoffs to reduce costs. Imagine that you have an HR team of five people. If AI has dramatically improved worker efficiency, can you have an equally effective HR team with only four people? That is basically what happened here.
I would say the GP's phrase: "more productivity means fewer people are required" is perfect summary of my opinion (and post). Sure, you can flesh if out, but that is crux of my argument.
> They fired some talented folks. Folks who could be retrained.
I see this sentiment a lot on HN. To be clear, I am responding from the perspective of US labor law and general business practices. Employment is not a sacred right in the US. The US system is (larely) hire and fire easily. As a result, the US economy is mildly unstable for the middle class normies (much, much less stable that most other highly developed nations with strong labor laws -- most of G7/G20), but overall wildly dynamic for a large economy.
"They fired some talented folks."
Sure. That is guaranteed with large layoffs. I work in an insanely competitive industry, and there are annual culls each autumn of the bottom 5%. Few are surprised by who gets cut. What is harder to forsee is a business downturn and they need to layoff X% of staff. You see good people let go. That's just life in that kind of system.
"Folks who could be retrained."
Again, in the US, for white-collar office workers, this almost never happens, and surely not for very highly skilled software developers (probably most of the layoffs at Cloudflare). It is not required by law, and it is not a common business practice in the US.
I think GPs point is that this is how they're trying to spin it, but they're not explicitly saying it, and there are doubts whether it's actually true. For outside observers it's difficult to simply ignore all the embarrassing outages that cf has experienced recently and just accept that the company has suddenly solved all their issues by using AI and firing people.
> For outside observers it's difficult to simply ignore all the embarrassing outages that cf has experienced recently
I don't know what to think when I see comments like this. Everyone makes mistakes. And no one provides flawless service. If their recent issues are so damaging in your opinion, why is their business continuing to expand at more than 20% per year?
I don't think the mistakes in themselves are damaging. What seems damaging to me is that cf has, on multiple occasions, repeated the same or similar mistakes right after they made major mistakes. This makes it seem like they're not learning from mistakes. Regarding the success of their business model, I can't make a meaningful statement about it, but is that really a convincing argument? If a business is successful, does that automatically mean their product is good?
> AI is increasing profitability faster than the business is growing
I don't understand how this could be the case for Cloudflare specifically. They made their name with DDoS protection and sandboxed hosting. These are exactly the products whose demand rises in lockstep with agent adoption. How could they possibly be allowing all the growth opportunity to slip past them? In times like this, with rising productivity to boot, you increase headcount, not decrease.
I hope this bubble bursts soon. HR people avoiding to do their actual job seems like it is the modus operandi in the majority of businesses these days.
it's all marketing wank, but how can they "supercharge the value delivered to customers" through company restructuring? whether they hire 50k more people or fire everyone, the value delivered to the customer depends on the quality of the product and the price - irrelevant of cloudflare's margins.
You also have to consider nowadays whether a human even wrote most of it, or if is just a tale told by an idiot, full of sound and fury, signifying nothing.
But yes I agree the trigger for layoffs is never massive productivity, the reasons give here are completely bogus and if management actually believe any of it the company deserves to die.
I don't read this as employing 20% was twiddling their thumbs and sitting around.
If it means anything beyond economic issues, I read the implication as their LLM expenses have gone threw the roof and with the choice of cutting LLM use or cutting headcount, well we see what mattered more to them.
Unfortunately I think we’ll see more and more of this as companies continue to encourage their employees to use LLMs everywhere and for everything. Eventually they will have to come to terms with the cost of such mandates, and it’s either ask your employees to “use AI less,” or it’s let some percentage go and continue to let the rest burn tokens.
I am perplexed at how it can cost so much. I have been using AI every day, all day for a few months now and I have not even gotten to spending $300 a month. I use Cursor for teams, so we get ~$80 of usage for our ~$40 per member, then we pay Cursor's upcharged API rates from there, and I STILL don't spend more than $300 a month, if that. What the hell is everyone doing with their fucking tokens?
No, it is more accurate to say that leadership at Cloudflare does not know what they are doing nor have they known what to do for a good decade now.
Acting like workers at Cloudflare have any meaningful say in how work is made or the direction of the company is delusional neoliberal fantasy thinking.
The onus of poor business outcomes is laid directly on its leadership. Saying that workers were unproductive when they were coerced to follow leadership's mandates is just straight up class warfare.
So you would contend it's in the economic sense. It wasn't intended as an assignment of blame, I was just saying Cloudflare either thinks they weren't doing the job or job they were doing wasn't making money.
I believe they meant that the cost of using an LLM is extremely high! There are reports of people spending USD $500~1000 a day! There's the possibility of decoupling of effort and output! Which causes an illusion of work.
This really sucks. I loved this job. I'm an EM and I was trying to hire more people because we're so busy with everything we needed to do. My teams products are something like 95% profit.
Really going to miss my team, they were wonderful to work with. Secretly hoping they'll have to rehire.
I refuse to believe it was about AI. Coming from the inside, the bottleneck was never code. Seeing who is being laid off, especially on my team, it's the people who make things run.
In my experience, companies never value transparency. And it's doubly true for companies that boast about transparency. Obviously, it's within their authority to cut head count, but they've also obviously made some kind of major strategic shift either to cut costs or abandon some lines of business and they are not being upfront about it at all. The stock is up 111% over 12 months. They don't seem to be in any danger of crashing or collapsing.
I know of 4 teams in Cloudflare One, who lost EMs, PMs and engineers in really critical connectivity systems. Our list of things we need to do is years long. Many of those are needed for reliability and scaling.
They quietly stopped hiring months ago and I figured things were not good. My mistake was thinking my group would be a little safer being profit drivers and big deals...
Do you really think management would come out and say "Hey we actually fucked up and don't really know what to do. Please don't punish us, here is a ritual sacrifice instead."?
Of course they're going to downplay their own stupidity and use LLMs as a means to suppress terrible news.
They will just expect a lower wage rate. There's some tacit collusion going on here.. they are using LLMs as a vehicle to address the price that comes with the true shortage of software engineers. You seriously dont think they talk about this behind closed doors? of course they do.
I've been laid off from every job I've held (and once I was even re-hired a month later!) so I know the feeling. There seem to be others here who are also impacted and I fear the overall trend will only continue, so I wrote up my thoughts on how to future-proof your job search. I do think the GP comment about institutional knowledge could be a key part of it. Hope this helps: https://news.ycombinator.com/item?id=48067459
I promise you there are a ton of companies desperate to hire talent right now. It's hard on both sides of the market. Lots of noise, but there is demand for this supply. Unfortunately, that means personal connections are more valuable than they used to be, just to get the ball rolling.
Are you sure? Can you share some of those companies that are desperate to hire talent right now? I'd like serious teams as I need to find work. I do keep an eye on HN, Wellfound, Workatstartup, X, etc.
There are always a ton of companies looking for good talent. However there are not nearly as many as a couple year ago: there is more good talent looking for a job than there are jobs. This has happened before, it will happen again (this is easy for me to say - I still have a job, but I've been there before and I know first hand how bad it is when you need the job).
Good luck to those of you looking for a job. My company is hiring a few people, but if someone leaves today there is only a 20% change we hire someone outside to replace them so I can't really offer leads worth looking at.
My company is hiring (small, but definitely happy to talk to you and all the people who made stuff run on your team at Cloudflare!) https://jobs.ashbyhq.com/blaxel
I know Waymo is trying to hire like a thousand engineers this year.
"I'm an agent person. I'm good at dealing with the agents! Can't you understand that?! What the hell is wrong with you people?! I'm good at dealing with the agents!"
My stance is this: Fine, maybe you need to restructure for profit reasons. If that is the case, then it is also beholden upon the people doing the layoffs to understand their responsibility in that.
In an ideal world, a layoff of this scale would also require a shakeup of the management that let it get this bad in the first place.
What's more, the higher up the chain, the less onerous the layoff for the individual getting laid off.
Why should people who are profitable to employ be laid off as well?
It just sounds like you're upset and want to hurt whoever you feel is responsible for making you upset. That's not a productive stance to have on important topics.
I'm not asking for the people who hurt me to be hurt. I am asking that the responsibility of the actions that management layers took be considered in layoffs.
For instance - If overhiring happened, how is this not at least a little bit on the individual that approved of a hiring spree? Why is it that they should be able to yield a baton that hurts the workers they hired, without having to actual bare the brunt of the decisions?
If a business is still unprofitable, a business that touches so much of the internet like Cloudflare, then that is also a strategic failure and should be punished as such.
I feel like your tone in this response was also so condescending.
This is how the elites actually feel tho. They think they can do no wrong, it's not their fault that they don't know how to run a business but you should please give them another chance and not change corporate law to stop benefiting them over workers.
It's a mindset that enables neoliberalism to flourish while vast majorities suffer immensely to benefit the few.
It's a system that's worth questioning as the material lives of 100s of millions of Americans are getting objectively worse every year while we are always being told there is no money for healthcare or childcare but there is always trillions laying around for imperialistic activities like data center expansions and war.
Let's throw the elites in jail, so that more elites can come in and do the same thing?
There's a limited pool of execs to run companies. Its a pretty homogenous group of people, similar skill sets, some have varying philosophies on how to run companies, but the majority of them will likely make the same decision if given identical sets of circumstances.
I get triggered when people start calling out "elites" and other boogeymen - what does it mean to have companies run by non-elites? What even is an "elite"? Are they elite simply because they are employed as an exec? Is it possible to have a non-elite executive?
Using "elites" in this context makes it feel like an emotional complaint about the world rather than anything rooted in logic.
None of these elites are operators -- they're liberal arts educated and their primary skills are in using words and lack of to achieve status gains -- nothing more.
In many traditional industries, companies are built and run by the most senior members of whichever discipline. Tech is different because most of its skilled members intentionally cede soft power because of personal (imo short-sighted) predilections and the exorbitant amount of money flowing in has caused a mad dash from other disciplines.
The "elites" are people trained either institutionally or personally (from their relationships with others) to understand power dynamics and utilize them for personal gain.
Navel gazing is a great away to achieve nothing. Being lorded over by someone who couldn't even figure out how to build and host a simple webapp is ludicrous. Should the CEO of my hospital not understand that the mitochondria is the powerhouse of the cell? Should the partners at big M&A law firms have no idea how to read a contract? No, because that's fucking ludicrous -- yet it persists in tech because its technicians have zero training, education, or even sense for elite ways of thinking.
No, it's more like we have undemocratically elected people in positions of power that want to act like dictatorships when in reality these people made a mistake that is costing the company billions of dollars and their ineptitude means they should be removed from these positions.
I thought Silicon Valley was all about meritocracy? Why should corporate shills that does not know how to profit from entity that controls 25% of internet traffic be allowed to keep their jobs but the actual people providing real value, the workers, aren't?
That is a system that doesn't benefit humanity. It selfishly benefits the few.
I really don't know. My org now has 40+ engineers with 2 managers. Down from 6. I really don't know how they will do it. Each one of us were handling critical shit, and desperately needed more engineers. PMs made things run and they got hit even harder
No one had any idea. My director got the same email
Almost 99% sure that They hired a consultant firm (MBB) that told them who to cut; this is pretty standard practice now at public tech corps. Especially if EMs weren’t in the loop. This looks like purely a margin improvement exercise thats hiding weaknesses in the company’s financial performance.
I’m sure they don’t know what they are doing or necessarily care, but I’m still curious what the consultants even claim to be looking at to make the list? Job description, git activity, team level profitability, salary, etc?
Employees are treated as a cost which is why you often see the strongest performers inexplicably laid off (since they are likely compensated higher). In situations like this they don’t care about productivity; leadership is given a list and they can move a few people around but for most its game over once they’re on it.
Thats usually correct for these “surprise” layoffs. For the ones that are announced in advance there is a bit more coordination (like the meta/amazn ones).
If you know anyone that works at MBB they would be happy to share this with you; if you’re in SF just hit any bar for a weeknight happy hour and you will 100% find someone.
Yeah, honestly this is where LLMs shine since they were trained on so many MBA/HBS materials. Just remember to ask your questions in a way that praises neoliberalism and you'll unlock even more secrets about how they fuck over and alienate workers.
This style of layoff seems far more common post-2020 than targeted "restructuring". I've lived through a few layoffs now, survived most of them, but each time and at each company I've gotten by on an apparent roll of the dice and nothing more. Every time I've seen some truly important ICs get let go, their EMs having no input.
> I was trying to hire more people because we're so busy with everything we needed to do
That’s how it was at my previous company also. If you asked any engineer there they’d say “I’m incredibly busy, and I need more headcount to get through the things on my plate”. Then they laid off 40% of the company because AI had made everything so efficient shrug
Welp, looks like I’m affected. If anyone is looking to hire a systems engineer with distributed systems and load balancing experience, shoot me an email at <anything>@piperswe.me :/
Firstly, kind sir, layoffs are hard for each and everyone of us and I wish you best as you navigate it. I know you will get many wishes and good lucks though but consider my wishes to be one of many to help ya out.
I recommend if you can share your CV/send a message there, I will try to also keep an eye on it if you do share your CV/resume there and I would love to upvote your comment there to shower some more exposure/love from the community as you are member of hackernews. You are also part of the hackernews community and its the least that I/we can do.
I'm honored you're responding! I've received a few leads from this comment that I'm chatting with, and it's been a major morale boost for me.
At this point in my life and the economy I'm not particularly looking for such early-stage startups like Magnetic (especially w/ relocation to SF), but thanks for giving me the heads up!
You probably have other stuff on your mind right now, thus I can understand if you are not in the mood for answering, but I‘m too curious to not ask:
According to the Reuters article, AI use has increased 6x over only three months. How did that feel from the inside? I’m especially curious because Cloudflare is not a toy company, and this is not about some influencer trying to sell me their latest „this changes everything“ bullshit.
So, shifting a company significantly towards agentic AI, and I assume this isn’t simply about „install Claude Code on every desk“: would you say it actually works? Or would you say it’s still more of a bet, and still needs to prove itself as a sustainable long-term strategy?
I work at a similar scale company. Like an average person's experience, some things are amazing and super productive with AI and some things aren't. And it's not always the same things all the time.
Sometimes we are able to do a ground up rewrite of a service and squeeze huge efficiency gains out of it all bc AI is helpful in doing so and we have a very good test harness.
Sometimes it makes subtly wrong suggestions that people follow and cause outages.
Sometimes it leads to huge headaches for devs who have to review huge backlogs of code with no idea which parts are serious and which are low effort AI slop.
Sometimes it lets you do a 2 month project in 2 weeks.
I had OpenCode doing most of my substantial code changes for me, once I figured out what the code changes had to be. (so, it saved me typing but not thinking) I also vibe-coded (really slop-forked TBH, that's the Cloudflare way after all) an internal tool that our team used. I definitely was not a small user of our AI tools, though I know that there are others with significantly more.
I'm going to start calling these "Canary" moments.
Assuming we take everything at face value for these sorts of cuts, it creates the following scenario:
A company finds itself with surplus labor capacity due to the efficiencies in AI while also posting substantial profit or revenue growth. The company could downsize the workforce to capitalize on short-term efficiencies and increase margins, though this will come at the cost of long-term reputational harm due to posted profits/health as well as burning out staff who must do the same (or increasingly, more) work with less headcount, leading to attrition when the market shifts in their favor. Alternatively, it could leverage this surplus labor for a period of moonshot R&D or paying down technical/process debts while they have the capacity and the profit to pay for it, which harms short-term share price relative to their competitors slashing jobs, while improving the company's capabilities in the marketplace in the long-run, potentially through mastery of these AI tools or the creation of new product lines.
The fact so many orgs opt for immediate greed over long-term growth really is its own canary that leadership and governance both has failed the marshmallow test.
Yeah, I wrote this before I dove into their balance sheets for another comment. Cloudflare’s cuts are more defensible than most, but the timing and explanation are shady given that they’ve had the same problems for years.
Turns out running a profitable business is really hard when all you've known was ZIRP.
Honestly think the business lessons from big tech over the last 20 years are hogwash, mostly due to them abusing their monopolies allowing them to subsidize failing BUs indefinitely.
37signals has a better approach to starting software companies, and many of their peers/near peers indicate that it's a better way to sustain lifestyle companies too.
Doesn't turn you into a billionaire tho, maybe that's a plus.
If the market had been saturated then there wouldn't have been any (hypothetical) revenue growth which is what the comment above was arguing.
Personally I don't think there was any revenue growth to begin with. They are spending a lot on AI and haven't seen any ROI but for reasons they prefer to fire people and keep investing on AI.
"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.
Sounds like your company is burning 1000 dollars a month for something people are barely using. At some point those costs become unbearable and they admit that absurd AI budget was a mistake, or they admit no mistake and fire people. I know which they'll choose.
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
On heavy coding days it can go up. But most people aren’t coding all day. And research and docs tend to be pretty gentle on the tokens IME. Only time I hit my limit was coding for 80 hours in a war-room.
(Also I mostly use cursor which is more efficient with its implicit use of light models and indexed workspace).
You can't really compare them to Microsoft, Oracle, or Meta. Those companies aren't cutting costs because AI replaced their own employees. They're pouring money into AI infrastructure and models because they want to sell that capacity to others.
Their thinking is more: instead of funding another internal product team, they can redirect that payroll spend into more AI compute and models they hope to monetize.
I don't believe CloudFlare is doing that, though they might, they could be needing to spend in Edge AI compute and what not, building out that infra isn't free, so they might need to find places the cash will come from.
Excess labor would only translate to increased revenue and new products if these companies had a product vision to begin with. But they don't, so people get sacked.
You are on the right path, but I think you are off by a bit. Every company has more work they want to do than budget allows. However some of those things won't pay off fast enough. That is they have product vision but are smart enough to realize that those extra things they won't be able to do are not things customers are willing to pay extra for today.
This is simply a symptom that the company doesn't have good Quality Control processes in place.
AI-produced code is good but it's not so good that it can replace hand-crafted (or heavily supervised) code written by the type of engineer who works at Cloudflare.
What's really happening is that a few employees realized they can game the system by turning on a firehose of AI slop and pushing 10x the LOC than any other engineer (with or without AI), because there's no one to tell them to stop, and in fact with a management that actively encourages this.
> What's really happening is that a few employees realized they can game the system by turning on a firehose of AI slop and pushing 10x the LOC than any other engineer (with or without AI)
Did they figure out how to game the system? Or was the system set up exactly with incitaments to produce exactly this outcome?
They figured out how. Mind you the system was setup with incentives to produce this outcome - but before AI it wasn't really realistic to produce all those lines of code even though you could and so nobody was gaming it so badly it broke. (it was always broke, but the breakage was acceptable before)
> A company finds itself with surplus labor capacity due to the efficiencies in AI
It's likely more:
A company finds itself with surplus labor capacity due to the over hiring during Covid, cutting down on risky ventures, protecting margins, and narrowing scope.
But I think there's also:
A company wants to see if AI is making them more efficient, decides to cut people as if it was and see what happens.
I also am not sure about the short term stock price, many recent mass layoffs the stock often moved down. The CloudFlare stock is tanking in after market for example.
> The fact so many orgs opt for immediate greed over long-term growth really is its own canary that leadership and governance both has failed the marshmallow test.
Why do you think it's greed? The company's stock is down and they just missed expectations on their last earnings report (unheard of in big tech in the last 2 years).
This was kind of my read as well. We are increasing our AI usage but not in a way that meaningfully affects our ability to deliver on our product roadmap, so the solution is to cut opex on people so we can devote more to compute. The last bit is obviously speculation but it doesn’t feel like a far leap.
Vague overtones on AI savings without any hard evidence that’s happening, while ignoring obvious evidence that the company over-hired and is now underperforming relative to what would be needed to justify all that headcount.
Nobody believes these narratives at this point and CEOs would garner a lot more respect if they just simply said
“I screwed up, we hired too many people and fell short of performance targets. I own that. This resets us back on track.”
There was an recent article on X with an interesting take - it could be that companies are doing layoffs not because AI is making them more productive but because it hasn't. Their costs have gone up paying for expensive AI but haven't seen any revenue benefits to offset it.
This is no that far fetched...
I don't think it's that common that a customer sits on the fence and says "If only company X had Y on their feature list I'll be a paying customer". So the speed at which the company now runs through its roadmap does not equate to new customers joining.
I wouldn't argue that it doesn't give any benefits. However, it's not worth the current cost unless you already own RTX PRO 6000 to run any reasonable LLM. I'm using Claude Free and I'm happy with what I get, especially for the cost of $0.
I'm eagerly waiting for the prices to come down so I can upgrade my PC to AM5 and run Gemma 4.
Its quite possible that LLMs become housed units like the next PC. Initially it starts off as being a large thing in data centers (like computers did) until they got smaller and smaller. Except I expect the time it takes to get smaller and smaller to compress much more - given that we live in a world with far more resources and risk-taking.
Personally, I think AI is just a convenient scapegoat for these mass layoffs. Also, these kinds of announcements contribute to sustaining the AI hype which all tech investors benefit from. And investors looove hearing about mass layoffs, stock goes up every time without fail.
investors are not some nefarious monolith cheering for companies to make decisions based on how it benefits The Vibes. they're analysts assessing business decisions.
It went down on poor earnings call. Layoffs were probably an attempt to soften the blow. Hard to tell what was the effect, because the two happened simultaneously
This is the simplest and almost certainly correct answer.
I’ve seen this at a number of public companies, and is a reason I hate working for them. These decisions are always unbelievably short sighted and ruin companies in the long term.
This genuinely wouldn't surprise me, and I need to go back to looking at balance sheets to see if I can sus out the validity of that narrative. As AI subsidization ends prematurely and costs skyrocket, we should expect to see those costs reflected in the operation statements of major customers.
Since I had Coinbase up for review already, I decided to peek there first for any sort of correlation. In 2023, their "Technology and Development" line item shows $1.32bn going out, and by 2025 it'd ballooned to $1.67bn. This is despite headcount actually contracting by almost a thousand people between those two statements, which would normally mean a smaller technology spend since a lot of corporate software is seat-based nowadays. This suggests that yeah, actually AI spend is creating a heavier drag on the balance sheets and it's being offset with layoffs since the "job replacement" narrative is strong. That said, I'd need to check dozens' more balance sheets to draw any sort of industry-wide conclusion.
And to factor in other infrastructure costs that's become more expensive too, such as hosting or hardware.
So unless you can isolate AI spending from others that's not going to be convincing.
...hence why I qualified the statement like I did. I'm well aware one example from one company in a budgetary line item that's inclusive of labor and licensing and hardware and purchases and AI is not going to be remotely conclusive on its face.
Yet even taking into account all of that data, a $300m jump in three years must include some significant and growing amount of AI spend; everything else would've contracted (licensing, hardware) stagnated (cloud consumption), or been a singular event (CAPEX purchases) relative to the company's health and headcount.
Rings true because now teams end up building a lot of things that may or may not have alignment to customer/business needs.
The slow part has always been figuring out exactly what the customer/business actually needs, not the coding. Now teams are throwing money at tokens without solving the "who's buying this?" part appropriately and end up just building excess.
Now that you can just throw tokens at it, it seems like actually thinking about what is useful and productive is no longer a practical skill (it still is, just no one in leadership nor product wants to practice discipline any more).
I don't know what to say about it except that it legitimately feels like some folks have just shut off their inquisitiveness and willingness to investigate and think before acting.
Now it's act, waste tokens and time, only to learn that the result of the action was obviously bad from the start because of some real-world human nature that we now no longer stop to try to understand first before applying a technical solution.
They're laying off the people who can't produce a minimum of 2x with AI, and keeping the maximalists with no life outside of work barely keeping up with the 100k LOC a week they're shipping to prod.
Suits have an idea of what the New Model Coder should be, and it's not people who don't burn through 100,000,000 tokens a week.
The promise of AI gains with fewer people is what's triggering this - before, you needed ~1 coder to do ~1 unit of work. Suits now think you only need 1 coder to do X units of work because LLMs.
They are laying people off because the cost of financing have gone up. The risk free rate is now almost 5%. For equity financing you'd need to show revenue growth models that allows repayment at that rate plus equity risk premium (which is quite large for new growth companies).
So the CFO makes a model that allows for this and for sufficient ROI they need less people to be more productive. This mechanically forces them to lay people off.
Of course laying people off might actually not improve productivity, but they need this to have chance.
I know it's probably automatic because of the similar titles, but hitting the bottom of the layoff announcement only to be recommended that article about hiring 1,111 interns in 2026 is a reaaal bad look
Not meaningfully, but sometimes 6mo-1y as part of an undergraduate programme to gain industry experience. E.g. I had 6mo in my third year (not at Cloudflare).
They are in a great position to generate a lot of value without rising prices, they haven't realized it yet because what they have to do is pretty boring.
I use Cloudflare for a lot of my side projects. It's a pleasure to use, and I manage to stay under the free tier. It does feel like they should be bigger in the cloud space, but I imagine the major players get a lot of revenue from VMs, which is a space Cloudflare has avoided.
Their AI costs have increased 600% but this hasn't translated into actual revenue. Also they are probably projecting AI costs to keep growing. They've done the math and at some point it is going to affect their bottom line.
Reducing or limiting AI usage would be inconceivable given Cloudflare itself has invested on AI and is selling AI services. Instead they've opted for reducing about 20% of their head count.
I don't think so. I think this is a common narrative in Hackernews when layoff news are shared. All the people I talk to in the industry positively confirm a boost in productivity. Its contribution to actual revenue could lag but it is present and confirmed by many.
I feel new startups, features and more services coming online would be a good measurement of this amazing productivity boost we're seeing.
Have you noticed a major improvement in every service you pay for ? Like many new features and incredible improvements in user experience and reliability? Because I’ve not really noticed that. Actually, things seem to be offline more than they used to, namely GitHub.
I am definitely more productive at generating lines of code though which definitely gives me the illusion things are mOvInG rEaLly FaSt.
Nah, even insane token costs don't come close to the costs of labor.
Most likely this is just 'AI-washing' - dressing a layoff for economic reasons (such as propping up their shrinking margins) as something more palatable to investors (AI).
The job market is already brutal for many candidates, especially people who aren’t social media personalities and don’t have names like Cloudflare, Meta, Amazon, or Google on their CVs. Some people will end up homeless...
At least having Cloudflare on their resume will likely help many of these people land new opportunities, so I wouldn’t be too worried about their long-term prospects...
What I don’t fully understand is why a company like Cloudflare decides to let experienced people go under the umbrella of “reorganisation.” Couldn’t some of them be given the opportunity to adapt to new priorities or ways of working?
What exactly is so fundamentally difficult in 2026 that someone with years of experience can’t learn?
Of course, large organisations sometimes develop dysfunctional habits. I’m not saying that’s necessarily the case here, but common examples include:
1. Problems that a motivated engineer could solve in minutes instead turn into meetings scheduled a week later, followed by more meetings.
2. People are becoming so process-oriented or conservative that they reject new approaches by default (Not even trying things out, and I don't mean migrating to a new fancy framework)
3. Engineers losing touch with product thinking and customer impact.
And if the explanation is cost-cutting, it’s fair to ask where companies choose to spend money elsewhere, e.g. unlimited LLM token usage with little accountability, extravagant off-sites, flying thousands of employees to expensive locations, etc.
Finally, why do they keep hundreds of job openings on their careers page? Are those false job descriptions wasting candidates' time?
The AI argument doesn't make sense to me for layoffs. If AI is making the company more productive then there's an incredible opportunity to use the existing workforce to tackle the massive backlog of important work. A big layoff only makes sense if there is no more useful work to do or you're killing products.
AI usage is getting expensive since Anthropic et al are turning the screws, and that money has to come from somewhere. Reducing AI usage is blasphemy of course, so cutting headcount is the only path forward.
Is there no one figuring out ROI on AI spend vs human payroll? I can't make sense of this idea that companies are firing productive employees because they're spending too much money on AI that isn't doing anything for them... they still hope chatbots will be worth it in the future?
The marginal gains are inevitably diminishing (since you pick the lucrative options).
There's a practical rate at which work can be done, limited by all sorts of things like organisation friction, how fast customers are willing/able to adopt new features, and how fast you can learn from it.
Arguably AI can improve all of these, but those improvements might not be happening as fast as CloudFlare are able to pump out features.
Further, this is all exacerbated by upper management having to made decisions at the nth derivative. Meanwhile, salary costs you now. You might foresee vast riches in future, but you have to remain solvent and competitive until then.
These all points towards layoffs. There are many factors that point towards keeping employees.
How to decide? No idea. Rightfully no one trusts me to make these!
It's such a bad time to be laid off right now. The competition is ridiculous. I have to compete with like 100k world class employees. Best wishes cloudflare former employees. I hope some of you make new companies and hire other geeks who are on their butts. A lot of us at other companies got the boot with no severance or early stock vestings. It could be worse!
I dislike the title because it doesn't clearly state it's a layoff. "Building for the future" gave me the impression that it's about some major new initiative with a roadmap outlining plans.
It's interesting how every time there's a layoff, the blog post always has a title like "Preparing for what's next" or "An update on our workforce" or "Getting ready for the agentic era"!
> "Building for the future" gave me the impression that it's about some major new initiative...
If you'll believe them, it indeed is:
... [the Leadership at Cloudflare] have to be intentional in how we architect our company for the agentic AI era ... reimagining every internal process, team, and role across the company.
... [This layoff is] not a cost-cutting exercise ... [but] Cloudflare defining how a world-class, high-growth company operates.
... We don't want to [mass layoff] again for the foreseeable future.
... [Cloudflare] cannot rest on the workflows and organizational structures that worked yesterday. We're confident that [Cloudflare] will be even faster and more innovative [after layoffs] ...
They're architecting their company for an agentic future? They're reimaginging the definition of a world-class, high-growth company? They're not resting on the workflows that worked yesterday?
blegh
What the hell does any of that actually mean? Like in real life words? Because that much corporate bullshit really sounds like it is a cost-cutting exercise.
Yes. We've since changed the top link to a third-party article. We prefer to do this with corporate press releases* - this is probably the #1 exception to HN's "please post the original source" rule (https://news.ycombinator.com/newsguidelines.html). If anyone sees a better third-party article, we can change it again.
(Edit: it's not really an exception because the purpose of a corporate press release is usually to obscure the main story, which means it's misleading, so by HN rules we should change it.)
(Edit 2: I feel like I should add that this isn't specific to Cloudflare! It's literally a generic problem.)
I’ll never forget how when I was at Google, every email with subject line “An update on X” meant X was getting axed. Like, just say so in the subject line…
It looks like they are using the "agentic AI era" as an excuse to restructure in order to boost margins. GAAP gross margin dropped ~5 points YoY (76% -> 71%)
Whatever the play here they can’t be angling for any external PR or internal morale boost. What if they wrote: “This is a tough economy and we have to tighten our belts.” Maybe that’s naive of me. Bad signal to investors as opposed to insignificant employees and commoners (PR)?
But contrast with this:
> The way we work at Cloudflare has fundamentally changed. We don’t just build and sell AI tools and platforms. We are our own most demanding customer. Cloudflare’s usage of AI has increased by more than 600% in the last three months alone. Employees across the company from engineering to HR to finance to marketing run thousands of AI agent sessions each day to get their work done. That means we have to be intentional in how we architect our company for the agentic AI era in order to supercharge the value we deliver to our customers and to honor our mission to help build a better Internet for everyone, everywhere.
What is this even saying? We use a lot of AI. And not just for other people... for ourselves. This means that: we need to be intentional?
What is a regular, not-investor, person supposed to glean from this? We’ve hit the automation jackpot: some of you will be fired, some of you will get more work for the same pay?[1] Along with shoving your face with euphoric buzzwords “AI era”, “supercharge the value”.
I must surmise that whatever PR and internal morale blow (?) matters so little to them. They are not at all afraid of any backlash from any lowly people.
[1] Again. This paragraph isn’t saying anything beyond that they are using AI and ho-ho things are a-changing. So one has to guess.
"We are our own most demanding customer. Cloudflare’s usage of AI has increased by more than 600% in the last three months alone. Employees across the company from engineering to HR to finance to marketing run thousands of AI agent sessions each day to get their work done. That means we have to be intentional in how we architect our company for the agentic AI era in order to supercharge the value we deliver to our customers and to honor our mission to help build a better Internet for everyone, everywhere."
As an English enthusiast, I'm getting very frustrated at how the language is consistently abused in executive communications to write words without saying anything.
The implication that is NOT said is that suddenly 20% of people were sitting around without any work to do because AI was making everyone so efficient and productive. This does not, however, seem to be the reality, based on conversations within the company. It appears we have yet another case of economic downturn disguised as increasing velocity.
Wow, the way Upwork is handling this seems really bad. They announced the layoffs today, but nobody will know who is being let go until next week! Sheesh.
Clearly if AI were the productivity booster that we're told it is, you'd see hiring into it, not firing. Though I guess on the call Prince did say he expect end '27 to have more employees than for any of '26. Anyway.
Except for one small, very tiny, itsy-bitsy problem. We humans are very bad at understand the second and third order effects of events. Really, really bad. First order consequences: "Oh we don't need people anymore".
Do I know the second order effects? Probably not. But at least I know they will be there.
Letting go 1,100 people into a bleak job market. Absolutely awful.
It wouldn't shock me if people formerly in tech have changed careers entirely, seemingly every tech-focused company is laying people off in favour of AI.
Cutting salaries to pay the AI costs for the remaining engineers. Going to be rough as this trickles through the entire economy over the next 10 years.
I know this is cold comfort, but in times like this, it can be a good idea to start your own company. Cloudflare itself was founded in the wake of the GFC (post-2008), when tech was dead as a doornail. The best time to start something is when awesome people to work with are unemployed.
Makes sense to do these things. To realistically make it through this paradigm shift you need to organize into a thing that can exploit it. That inevitably requires eliminating teams that don't fit into the new picture. The severance package seems quite generous. Hope everyone lands on their feet.
It's not that individuals are not useful, or even that their roles are not useful. It's that you have to structure your organization to be able to exploit a coming wave, and existing mechanisms and operations just get in the way. By the time Netflix shut down the DVD business it was making $80 m in revenue and the margins on that business were some 50%. But if you think the writing is on the wall, you're forced to act.
Doesn't mean the people in the DVD-mail-ops sides were bad at what they do. The world had just changed and the business became different.
"We are reorganizing for the agentic AI era" reads better than "our gross margin is compressing, our SBC is too high, and our growth is decelerating." Both descriptions could be true; only one gets you a flattering blog post.
I interviewed at cloudflare in ~2020 and didn’t get the job - everyone I met during the process seemed really smart and kind though. Would love to work with some of those people
Email me subject “cloudflare” if interested - thomas@ our domain (I am the cofounder)
The sre team I was hired onto last month, just lost 2 of ~12.
Cynically: our team hired two (me, senior, and a junior) and then we lost two (staff, guy who had been around since the founding, and a senior+ guy)... I kinda assume they baked in some of the layoff decisions into their past quarter or two of hiring to reduce seniority, and salaries, overall. Really short-sighted.
I was still needing to get some 1:1s scheduled with the guy who'd been here for Forever and knew which closets had all the skeletons stashed away. Can't do that now.
My response to this, as a generally satisfied CloudFlare customer who was excited to try out agentic email, is that it's not a good time to increase the amount of business I do with them.
A few people here have been impacted, so I want to talk about something constructive that could help them. As someone observing industry trends from the outside for a while, my advice to those looking to get hired these days: Build something useful from scratch – on your own –- that you can show off as soon as possible.
The buzzword everyone is looking for is "high-agency." (No, not those agents, but yes, those will help.) Basically employers want someone who will start something from scratch and take it to the finish line by themselves.
The interesting thing about this is, it is by definition not something you can put on your resume; It is something you show, not tell.
Yes, you need to do this even as you go through the absolute hell that is a job search. But trust me, this will a) help get a much better job, and b) help in the long run throughout and beyond your career. This will be the most valuable skill in the future.
You don’t need to use AI, but looking at the timeframes and skills in demand, yes, you very likely want to use AI.
A few other thoughts:
1. Target an area you are very familiar with. This will sharply cut down the time to MVP. This will be a challenge for the more junior folks, who should consider reaching out to senior mentors. Mentors, consider outsourcing a suitable personal project to them.
2. It could be something you are an expert on at work, if your employment contract and IP laws allow. As a bonus, releasing this as open source, or even a competing product if you’re so inclined, will have that intangible bonus of sticking it to your ex-employer.
3. Even if heavily using AI, keep your hands-on skill active. Most companies still do old-school leetcode interviews.
4. Bonus if you do something multi-disciplinary. Sprinkle in a domain you have no background in -- design, writing, sales, marketing, data science, frontend, whatever. You'll definitely need AI for this, and even when you make mistakes, few will harshly judge somebody down on their luck trying to expand their boundaries.
I understand that your advice comes from the right place. However "High-agency" is the "Full-stack Engineer" of the AI era.
A single salary covering many disparage positions and roles. It's been reworded b/c with AI, apparently you don't even need to be an engineer (or expect to be paid as one) anymore!
Hmm, I think "generalist" is the more current term for "Full-Stack Engineer." But that's more about technical skills. "High-agency" is more a combination of personality traits and technical ability.
So in terms of buzzwords it would be something like generalist + self-starter + go-getter + hustler + finisher.
They won't say it, but everyone wants basically a solo founder, except one who (to your point) gets paid as an employee.
Which is why I am saying this is going to be the most important skill. If they don't pay you enough, you could just go be a solo founder for real.
Worst part about the ai era is that so many are convinced they can and need to be on top of it to the extent of losing their core competency while mass producing trash
It’s good stuff but there’s room for a lot of things
This comment should be higher given how much FUD is in these comments. Hacker News having a meltdown about a bunch of backoffice folks getting laid off while they’re still aggressively hiring SWEs is… something
2008 really wasn't that bad if you were in tech...
No idea about 2001, but I've heard it was fairly rough. More recently I've seen people say now it's harder to find work today, I think in part because in 2001 it was mostly tech companies laying off talent, while corporates who were less impacted by the dot-com bubble were still building out their engineering teams.
The problem with the 2001 dot com bust was that it came on the heels of the telecoms downturn, so the two biggest (at the time) tech sectors were in trouble simultaneously.
Yes, there was still corporate IT - and some areas like finance were positively booming. But for online retail, media, advertising, etc it was a wasteland for 4-5 years. Plenty of people never found a way back into the industry.
To me, it felt much worse then than it does now (though perhaps the USA is being hit much harder at the moment).
2008 did hit tech but, outside of finance, the shock was over much quicker. The effects on the bricks & mortar economy were more obvious, though, so it got covered more in the media.
2008 the global economy came somewhere between hours to days of completely crashing if AIG hadn't been bailed out. Other than Covid, it's only the second time in the past 50 years unemployment hit double-digits, the other time being the early 80s recession in the wake of the 1979 energy crisis, which saw inflation go as high as 13.5% and the prime interest rate hit 21.5%. You're probably only concerned about your own industry, but even now, unemployment is still around the lowest it's been since WWII outside of the past couple of years and the late 50s.
It'll be another 40 years hopefully to get a full lifetime of experience and see how I ultimately feel about this, but right now, my sense is software saw a huge boom in the 2010s, a la aerospace in the 60s and finance in the 90s, and it isn't going to die, but that boom was never going to last forever, either. Being a specialist surgeon was always the only true close to guarantee you'll make half a mil annually with supreme job security. Everything else sees booms, busts, regional disparities, and power laws that make it hard to even talk to each other about it because nobody's experience is universal. Even now, in my particular niche of the industry, I don't know anybody who's been laid off. My own company and our competitors are not exactly drowning in cash (I work largely on commission and it's been a terrible quarter), but we're expanding headcount, not reducing.
Conversely, in the 2010s as software boomed and I did terrifically, basically my entire family is in trades and it was totally different for them. Drastic cyclical instability, projects started but then canceled all over the place, injuries, bankruptcies, drug addiction, prison terms. But that's also in California. I live in Texas and construction here seemingly mostly stayed in the boom state. All the tradesmen I know from here rather than family did much better. We also had roughneck as a lucrative fallback option for anyone that didn't mind living in the middle of nowhere thanks to the fracking and shale booms. Computer geeks from 2006 to 2021 or so also had that kind of easy skill transfer fallback thing thanks to the boom in computational data analytics due to advances in data storage and machine learning technologies.
We might even do well to remember that hyperscalers drowning in ad money for the past 20 years had a practice of intentionally overhiring to hoard talent but not give them anything productive to do, putting them into restrictive NDAs and non-competes largely to prevent them from starting their own companies or working for competitors. If that practice is ending, it floods the labor market, driving down wages, and reduces industry-wide employment metrics, but it's not death of the profession so much as ending a market distortion. Maybe it even supercharges entrepreneurialism, but right now we just seem to see a boom in the "solo indie dev" putting out reams of slop. At some point, people have to actually work together and have a real product vision that solves a problem other than using AI to make dev tools to harness AI for making more dev tools.
The problem today is we had 10 years of “learn to code” and a a lot of people did. Similar to 2001. 2009 wasn’t really bad for tech since we had a huge shortage of workers in the space. Companies would hire straight out of mid-tier universities. CS departments were desperate for students.
From memory, the only recent layoff where the company was not only profitable, but also growing is this one.
It's not clear if we are at the beginning of a crash or if the everything-bubble still has some pressure to expand. But whatever impression people can report here are about the past, and thus not about any crash.
2001 set tech jobs back a few years. 2008 wasn't nearly as bad for tech because as money got tight, there was an impetus for companies to invest in tech to cut costs. I think a similar thing might be unfolding now with non-tech companies investing in AI to streamline processes.
It’s not like this is a factory floor where you process something coming in and AI suddenly makes the process more efficient and people are idle.
Every team in tech world has infinite backlog, you don’t fire 20% the minute someone manages to close a few tickets.
Companies never want to reduce productivity unless they need to cut spending or increase profits. In other words, if AI increases productivity that’s a direct win they can use to beat their competitors. You can’t spend money you don’t have, but you want to spend the money you do have as point at there work to do, which there always is.
> unless they need to cut spending or increase profits
yes, so basically always? the situations where companies don't want to do this are very rare.
I understand your broader point that doubling down on productive things is useful. But there's no limiting principle to that idea.
The obvious reality is that businesses are trying to find a sweet spot between expenses and productivity. It's not always the case that slashing spending is worth it. But it's equally naive to act like being able to do more with less shouldn't make you want... less
Some of them yeah, they do jobs involving physical work, but some of them are office works — their jobs/companies are just set up so that they've got a defined set of tasks/responsibilities, and they're able to complete them all every day. (Or some/most days.)
They find the idea of an infinite task queue horrifying.
Many CxO made a decision to spend $$$$ on AI; that's their bet and they're are adamant about it. Money should come from somewhere and layoffs is the easiest way to free some budget in a software company. Was it a good bet only time will tell.
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.
Yeah, I just don't understand the thinking here on HN anymore. (My account is 15 years old)
It was clear to me even before ChatGPT arrived that software was eventually going to go the same way agriculture went. We will simply need fewer people to do the job than before.
I don't buy that AI will completely automate away all software engineering. I think if you're not in the top ~40% skill wise, you're in serious trouble and have a bleak future.
I think we're probably past peak employment for software engineers, but I'd also be surprised if these layoffs were directly related to Cloudflare thinking they can replace their engineering teams with AI agents.
With the hiring 1111 interns thing, I think these companies (amazon as well) need to realize this is doing anything but inspiring confidence in those interns. Instead of being excited about going there, more of them would opt to go elsewhere instead of returning full time, or if they do return full time they'd be in fear of being let go next.
Flippant sarcasm that they're pretending this wasn't a financial decision, and was entirely about being ready for the amazing productivity gains of ai they've already seen, expanding across the business.
Expenses were more on purpose, they amortized a bunch of hardware depreciation now instead of over 5-7 years with the new tax changes. This is pure greed
right but feel like comment count is a poor proxy for flamewar in an age where cheap intelligence to semantically classify discussions is available, so that, as affected me in the past, an author of a post simply enthusiastically engaging with every reply is not punished.
maybe to put it in a way where your values are aligned, i'm a curious person, and i learn a lot from the discussions that happen right on HN rather that only going to the source.. indiscriminate comment count damping takes away/lowers visibility of the most interesting comments that would provoke my curiosity.
one could instead do any sort of basic classifier system ranging from bag of words to running a ModernBERT to rate flamewarness and differentially apply the downrank based on "flamewar score" rather than "really poor proxy to flamewar score"
I don't see how laying people off isn't inherently and always a "cost-cutting exercise." If they had an unlimited budget, they probably wouldn't be laying them off, right?
Maybe it's supposed to mean that it's not... something more specific?
Any other engineers just living life frozen at this point. I am unable to make any life decisions because it seems like I won't have a career in the near future. I am unable to purchase a home to settle down for my family, because dad might not have a job next week. I know I am fortunate to have a job, many don't, but fuck if this career isn't the worse thing ever for my overall health and happiness.
Yeah I'm there with you. I got lucky as a kid with delving into this as a hobby and it turned into a professional career. Thought we could change the world for the better, what we made instead was social media cancer and LLMs that can pretend to make everyone 10x more productive. I loathe it.
I've been out of work since almost a year ago after getting laid off and the same is true for a lot of my coworkers; the job market is absolutely broken in half for a lot of different but related reasons. Thankfully I have significant savings and low costs so I can just coast and do stuff in my own time, but the same hasn't been true for others I know.
Frankly I fully expect people to get even angrier once they become unable to meet the bills and companies still tout the whole AI line.
Absolutely. News like this is so hard to ignore. Nervous as hell to drop big money on things the family needs right now. Grateful to have a job, but life overall was just better in almost every sense before AI became part of our daily vocabulary and layoffs occurring every couple of weeks.
I'm sure this is going to happen a lot to big companies, with AI they are all going to find they have too much staff and are not likely to benefit from a higher pace of development. Smaller/Mid size companies on the other hand are likely limited in how much staff they can take on and AI just accelerates their plans (I'm in a company like this).
That's 2 major layoffs this week (Coinbase being the other). Is there an underlying common reason for this? And is it indeed AI-driven productivity as both companies claim?
Whenever someone brings up ZIRP, especially someone with a username like yours, it's an indicator that they have no clue what they are talking about and like to regurgitate things they read on the internet.
> Also the US economy is collapsing, that probably has some relevance.
There's multiple simultaneous narratives: the industry-wide one of slashing well-paid tech talent under the guise of AI productivity boosts, and what's actually going in at each company.
Cloudflare is an outlier because the company doesn't actually make money at present; their past three annual statements show net losses in the tens to hundreds of millions of dollars. Not hemorrhaging cash per se (their cash reserves alone could cover ~9 more years of losses), but still enough to warrant some cutbacks - and AI is the current scapegoat, thus they finger AI and throw folks out the door.
Coinbase's story is different: they're making good money, but their industry is inherently volatile. Again, recent volatility in the crypto markets related to...things...is dragging down long-term prospects for currencies, while ongoing trades are broadly just insiders doing insider things or exiting their positions for liquidity. Still, their share price is down 27% over 5 years and 18% YTD, so they also need to pump their share price so the executives get paid; layoffs are consistently rewarded by the shareholders, thus they axe part of their workforce for the bump and fingerpoint to AI.
Never take what a company says at face value, and always check their balance sheets. What Cloudflare did sucks but could be warranted to some degree; what Coinbase did has no justification whatsoever beyond naked greed.
Its quite filthy but it benefits them all to lay off lots of people to reset the wage rate in the market... Im sure we will see a wave of re-hiring when this stuff starts to blow over but many initially will be at a much lower wage rate.
> Cloudflare is an outlier because the company doesn't actually make money at present; their past three annual statements show net losses in the tens to hundreds of millions of dollars.
Their free cashflow is high; they're choosing not to report a profit. I don't think it's useful/accurate to say they don't make money.
Don't get me wrong, they may be doing a layoff to boost margins or enter GAAP profitability but the company revenue exceeds its operating cost by quite a bit.
> First quarter revenue totaled $639.8 million, representing an increase of 34% year-over-year
So they're growing 34% annually.
> Free cash flow was $84.1 million, or 13% of revenue, compared to $52.9 million, or 11% of revenue, in the first quarter of 2025.
Cash, cash equivalents, and available-for-sale securities were $4,163.9 million as of March 31, 2026.
...and they have $84 million free cash flow in one quarter, and it's consistently pretty good cashflow.
And they have $4b of cash or cash equivalents stockpiled. It seems pretty healthy to me.
I think there's also a certain permission structure that once one sufficiently large org does a big round of layoffs and doesn't get punished, a bunch of others will run the same playbook. We've seen this before -- back in 2022 when Elon fired like half or more of Twitter and the service didn't immediately implode, it gave other CEOs permission to do massive layoffs in the guise of "efficiency" even though the real reason was ZIRP was over. Now they're claiming it's because of AI when it's really that their margins are eroding because the overall economy is slumping and they need to offset AI spend.
At this point, the thread has over 700+ comments, but if any impacted Cloudflare folks see this and are interested in working on the same shape of problems, Fastly posted our "Who's Hiring?" for May at this link https://news.ycombinator.com/item?id=47975839
Happy to answer any questions, though I only check HN about once a day.
Not sure how to feel about this. On one hand, the transparency about the layoff and the severance package for the employees are positive things.
But seeing the intern hiring count the year before basically offsetting the layoff headcount makes me think they've been planning to replace their employees with interns and plug the expertise gap with AI.
Really sorry to see the news about the RIF. My thoughts are with everyone affected.
If you (or someone you know) were impacted and want to stay in the distributed systems or data plane space, we’re doing a lot of work at Kong ($2B valuation API & AI governance company) on high-performance proxies, control planes, and Rust, Golang, etc. (I used to work on Cloudflare's edge proxy project)
Happy to chat about the roles or just the tech stack in general if you want to geek out. Feel free to reach out: datong#konghq.com
Companies like cloudflare operate at a very critical spot as of today. They manage the end points where TLS terminates for most of the internet traffic which means that they have access to all the information flowing through them in clear. When a company is so much motivated by the profits then it would not be too far away when they start selling all this information. With this much centralized control, they can easily turn to abusers instead of being internet gatekeepers for profit. Firing so many people is bound to disrupt the operations, the only question is how much can they can hide/manage.
I think this is the reason why the detailed definition of companies varies, the motivation and regulation on a company varies too. Absent the regulations, financial institutions would have run off with the money by now
You have however many people who you seem to believe have no useful work to do in their current roles. You aren't bleeding money. Is that not the time to invest in new products? To take moonshots?
Is this not admitting that they simply can't come up with any new ideas to invest in? That their intellectual capacity has topped out?
Profitable companies laying people off like this tells me they're done innovating and now it is time to milk the cash cows for all they're worth.
Wow, and I had thought they would be one of the winners in the AI era. A lot of SaaS's can be recreated with an agent and some tokens, but I thought the more infra-y companies would be the beneficiaries. I've vibe coded a few Cloudflare Workers and thought it was a great experience. And Claude knew how to use wrangler to do a lot itself.
Isn't the most likely explanation here that they needed to show in their earnings call how their bet on becoming AI infrastructure is leading to high revenue growth expectations, and that isn't happening (yet)?
The stock is currently at -17% in after hours trading.
So you need to do something that's good for your margins to show investors.
TBH I'm surprised people don't see the obvious result of this collective madness:
1. Force every engineer to use agentic AI to the max.
2. Constant anxiety at work due to the threat of job loss and unreasonable expectations from management/business.
3. Engineers start yoloing everything using AI while wasting tokens.
4. Speed goes up in the short term, while quality and expertise degrade little by little, all while bleeding money due to AI usage.
5. One year down the line you have a company full of engineers that don't care and a bunch of slop-bloated, bug-ridden products that the customers don't want, and a massive bill.
IDGI. How is a company that owns a bunch of infrastructure you almost have to use to put your service on the internet not more profitable such that they have to do layoffs?
Screw Cloudflare. I went through a bizarre 3+ months hiring process where I would have a disconnected, vague 30 minute interview with someone every couple weeks. Then, suddenly rejected for no real reason given.
Their hiring process is remarkably bad for a company that otherwise is so well run. My most recent experience was them throwing a workday link at me to fill something out before we even had the initial phone screen and the forms/ui was so poorly designed that I stopped responding to them.
Sorry to everyone affected by this. If any infra/platform folks in Europe are looking, Luxonis is hiring a Senior DevOps / Platform Engineer. It’s remote in Europe, focused on cloud infrastructure and internal developer platform work for spatial AI / computer vision products:
https://www.luxonis.com/about-us#devops-engineer
Why are they laying off anyone when you got 500 million plus in pure profit. The tax system needs to be reworked to not incentivize layoffs. Major taxes should happen to support the well fair system in order to support people laid off. This is a stupid system we live in.
I feel like they overhired over the years and now they reap what they sow. AI just accelerated their awareness of overhiring. I think if Cloudflare or any other well established software company stopped hiring this year, they would be doing the same as they did last year. At the end even the management will be replaced by AI.
"We are our own most demanding customer. Cloudflare’s usage of AI has increased by more than 600% in the last three months alone. Employees across the company from engineering to HR to finance to marketing run thousands of AI agent sessions each day to get their work done. That means we have to be intentional in how we architect our company for the agentic AI era in order to supercharge the value we deliver to our customers and to honor our mission to help build a better Internet for everyone, everywhere."
So basically, there were too many people burning too many tokens lol
How wonderful that even CEO Matthew Prince and COO Michelle Zatlyn can be replaced by AI. Maybe not today or tomorrow, but the day after tomorrow.
THEN I’ll be happy when management has rendered itself obsolete and becomes unemployed. Because the AI prompts used to replace the CEO and COO are trivial.
All the AI stuff is just noise to make it sound better - the real issue is the economic downturn.
If anything, AI makes each employee much more valuable because they can be much more productive and most big companies always have stuff that needs doing and opportunities for growth. So it's a sort of Jevons Paradox[1] situation but where human labour is the resource.
How wonderful that even CEO Matthew Prince and COO Michelle Zatlyn can be replaced by AI. Maybe not today or tomorrow, but the day after tomorrow.
THEN I’ll be happy when management has rendered itself obsolete and becomes unemployed. Because the AI prompts used to replace the CEO and COO are trivial.
Their stock has gone down nearly 20% in early trading today. When layoffs happen, usually it is the opposite, so I imagine Matthew Prince must be annoyed!
I am disappointed by this decision from Cloudflare. I've always felt that massive layoffs are something that companies who are greedy and don't care about their employees do (like Amazon and Meta). Up until now, my impression of Cloudflare has been that they care about their societal impact to an extent and still share old values from how tech companies used to be. Maybe they're starting the downward make-money-at-all-costs spiral that has gripped the rest of tech.
Their valuation is crazy. Trading at $260, with no profit, their price:sales ratio was 36x (extremely high). Now, trading at $195, their price:forward earnings ratio is 130x (extremely high). Unless they crushed earnings and revenue estimates and juiced their forward guidance, Cloudflare stock could have gone anywhere. Also, the stock is trading where it was a month ago.
I find it surprising that the word "incident" doesn't yet show up on this page. Cloudflare had at least two nasty incidents a few months ago. It certainly shook my confidence in the company's ability to run its infrastructure.
They want to polish upcoming employees into getting more used to AI tools usage but they don't want keep burning cash on experienced ones. They have to establish more YOY growth. Looks like everybody has to justify in the market why they need AI agents more than employees.
> Matthew has personally sent out every offer letter we've extended. It is a practice he has always looked forward to because it represented our growth and the incredible talent joining our mission
Who gives a shit if you treat your staff like this?
I will add cloudflare to the list of companies that I’ll never work for. Shame, because it seemed like an interesting place
wish they would have just moved these people to technical support; cloudflares support is the worst i've ever experienced even under business/enterprise contracts (no replies ever in most cases)
The message to every Cloudflare employee is clear: you'll be there for the company when times are hard. But the company will not be there for you when times are hard.
It does not matter if the way we work has changed, or AI adoption has increased, or aliens show up. This is a demonstrated lack of loyalty that would result in immediate termination of the situation were reversed.
The important take away for everyone else is do you trust Matthew Prince to always take the high road and do what is right, combined with the fact that they man-in-the-middle all of your websites encrypted traffic? What happens when revenues are down and the shareholders demand blood again?
You only have to be there for the company in that you do work for them and they give you money in return. Any tech guys working for them will have received plenty of money. I feel sorry for the non-tech people though (HR, recruiters, etc.).
This announcement is bullshit though. Banging on about transparency and then not even trying to give a reason. They didn't even try to say it's because of AI! They just say "AI is important. We're laying off 1000 people." Wtf.
You shot off a one-sentence rejoinder about capitalists building a future. What does it mean? Not worth your time to explain, but worth your time to nuh-huh about your autor intent after the fact.
"We are our own most demanding customer. Cloudflare’s usage of AI has increased by more than 600% in the last three months alone. Employees across the company from engineering to HR to finance to marketing run thousands of AI agent sessions each day to get their work done. That means we have to be intentional in how we architect our company for the agentic AI era in order to supercharge the value we deliver to our customers and to honor our mission to help build a better Internet for everyone, everywhere."
So basically, there just were too many people using too many tokens LOL
"Enshitification" is not a new concept. A business should always be willing to make their product cheaper, even at the cost of quality, until the customers start turning away. Of course you need to be able to catch that moment early enough so that you don't lose too much market share to competition. But that will give you increased profits. The same with increasing prices.
On a side note, I'm curious as to how "600% increase in AI usage" is measured. Are their agentic workflows' bills skyrocketed 600% in the last 3 months? That would be in line with what other people using agents are seeing (costs are way higher than they expect/used to be). In that case, that would mean that LLM/agents are no longer necessarily cheaper than human labor, no?
Labor market data this week came out stronger than expected, even as large layoffs in IT continue to happen and IT job market continues to be very slow.
This seems kind of a critical point in time. I consider Cloudflare to be one of the more serious engineering organizations based on the quality of the products. Assuming they are not lying, them cutting 20% workforce citing AI signals there is actual teeth to this AI optimism.
On the other hand "only" 20% for the foreseeable feature is good news? It means there is ceiling to productivity that AI offers.
Or perhaps I am giving Matthew Prince too much credit here, and this is just an opportunistic cost cutting measure.
They make it quite clear that these layoffs are in response to adapting to using AI at the company:
> The way we work at Cloudflare has fundamentally changed. We don’t just build and sell AI tools and platforms. We are our own most demanding customer. Cloudflare’s usage of AI has increased by more than 600% in the last three months alone. Employees across the company from engineering to HR to finance to marketing run thousands of AI agent sessions each day to get their work done. That means we have to be intentional in how we architect our company for the agentic AI era in order to supercharge the value we deliver to our customers and to honor our mission to help build a better Internet for everyone, everywhere.
The rest is hand-wringing about the emotional weight of the decision and what employees can expect from the process.
What remains to be seen is whether relying so heavily on AI will have similar outcomes to what we've seen from Microsoft and others. Which is to say, is now the time to stop using Cloudflare?
Someone who knows the product deeply and has grown it into what it is today will always stay valuable.
AI can replace people at a low level because they are seen as a cost. While people at the top are better connected.
CEOs travel a lot, probably subscribing to 100 mastermind groups where CEOs of other companies also hang out, playing dozens of mind games and strategising all the time.
Such people are hard to replace. The average employee's role is finite, and they aren't taking much risk; therefore, it's trivial to get rid of them.
Low level employees are always taking far bigger risks in relative terms, the worse position a CEO will be in if all of his "risk" hits him is that they'll have to become a regular low level employee.
I’m finding this a little difficult to square. If things are radically changing within the company and they’re rearchitecting how the company works, wouldn’t they start with a transition period? Letting 1k people go, many of whom will be important parts of the organization, while simultaneously making radical changes in light of a radical rate of change over the last few months, seems very high risk.
Taking everything at face value, does anyone have thoughts on why this change makes sense now vs. in 6 months? Are they ripping the bandaid off or… due to the size of the org?
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.
What the hell!? Cloudflare is absolutely killing it and now they're laying people off! I know some good people there with deep expertise and I hope they're not affected.
Cloudflare is transforming into yet another surveillance company.
I always see this "Cloudflare ensures you are not a bot"
soon may change to "Cloudflare ensures you have a digital ID"
They will not need so many people for this and there will not exist competition to bring better products when people are fired massively and are crippled by financial problems.
AI for me is an excuse. Not the main issue.
It is a strategic transformation to ensure dominant position by killing off competition. Afterall employees are always viewed as threat.
Cloudflare's stock price has been disconnected from reality for a while.. the only one that's wilder is Palantir which at least has revenue growth numbers that are very impressive.. meanwhile Cloudflare's enterprise value vs next 12 months revenue and revenue growth just don't justify this completely out of whack market valuation. I feel bad that the company has to try and sustainably justify that. It's incredible to watch the velocity of their launches. But I suppose the reality is most of them are just not selling
I am getting fucking sick and tired of a “service” that behaves so much like hostile malware and spyware that it gratuitously trips the protections I have added to my browsers and refuses to let me proceed.
Cloudflare is the CP of the Internet: almost no-one wants it, yet it persists like maggots eating the eyes of children.
> That means we have to be intentional in how we architect our company for the agentic AI era in order to supercharge the value we deliver to our customers and to honor our mission to help build a better Internet for everyone, everywhere.
20% of the workforce is currently being utilised for testing purposes by various companies. (just like we deploy Canary to 10% traffic for test)
In reality, approximately 5-10% of the workforce is equipped with AI technology and can now autonomously manage the entire company.
I am pretty sure CEOs can already see it! Companies create a great deal about the revenue per employee.
Downvoting my statement will not alter the situation, Claude and GPT-5.5 have the potential to replace most system administrators, DevOps engineers, copywriters, support personnel, and other roles.
I have observed this phenomenon in private product companies in India, where I serve as a consultant to multiple companies. I have noticed that 5-10% of the workforce is sufficient to ensure the continued performance of products, with reduced communication overhead, faster updates, and improved reliability.
I also have several side projects that encompass a wide range of responsibilities, so I am not merely a passive executive role.
In India, it has become increasingly challenging to secure jobs in the DevOps, system administration, and frontend domains.
In my opinion, a backend engineer’s job is the most difficult to replace at present, particularly if that engineer possesses a deep understanding of market and product dynamics.
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 quote: "The future ain't what it used to be." — Yogi Berra
The skeptical assumption is they need to pay for the AI bills, not that the AI use is actually providing the promises CEOs are making.
It is May 2026, there is no difference between AI and non-AI bills.
Most (if not all) major enterprises in the US have gone through at least one round of org-wide subscription renewals (eg: Atlassian product packs, Microsoft product packs, etc) where 1) price increases were mandatory, 2) AI features could not be opted out of, and 3) AI feature usage was strongly encouraged from C-suite to client-facing biz staff to telephone agent support staff.
I repeat, we are passed the point where AI bills and non-AI bills can be differentiated. We are all paying for these features driven by tokens whether we like it or not, whether the cost-benefit analysis makes sense, and whether they are even being used.
And we are all passing the costs onto everyone lower on the totem pole, from insurance groups to bank groups to national grocery chains to consultant conglomerates to minimum wage front-line staff to below-minimum-wage gig workers.
And this is why there are layoffs, every price increase from the top down causes further price increases to cascade down.
The reasonable assumption is they believe a recession is coming.
*a recession did infact come*
I've been told that a recession is coming since 2009, when I started investing - there has never been one since then despite all the dire predictions - therefore, my investments are safe
The government is very decided on not letting one happen, or hiding any minor recession. They will throw money at the problem as long as they can.
Have to protect boomers retirement accounts at the cost of future generations
They don't care about boomers, it is the wealth of billionaires that they care about.
> there has never been one since then
There was one in 2020, granted it was the shortest on record.
As the saying goes, "Macroeconomists have successfully predicted nine of the last five recessions."
If you had started investing 1 year earlier though?
As long as you didn’t sell, and in fact bought more on the way down, you did well. Of course, not everyone’s time horizon works the timing (you might need the money and so sell at a low point), but generally, being in the market pays off.
It kind of depends what we mean. If you're conservatively in the market, invested in the aggregate economy, diversified, and what not, yes, but if you're taking bets on a smaller number of companies you can just lose your money full on. Not every single company recovers from a recession.
That's why if you are a business, the risk of a recession is a real threat. Someone will recapture your market once the recession is over, but will you?
That also means people will lose their jobs, price of goods will rise, the pressure to need to dip into one's savings will increase, forcing many people into cashing out at the worse possible time. If you are someone with that risk, as an individual, a recession is a real threat as well, and you might want to reduce your market exposure beforehand.
I've lived through both 2000 and 2008. They do happen. And typically not when everybody says there will be a recession, but when almost everybody finally agrees there won't be one.
Not that us plebs can do anything about it anyway... :(
Why is this text not rendered as expected.
If you type 2 asterisks it's rendered as one, it's an escape character mechanism:
This text has one asterisk on each side
*This one has two on each side*
Obvious now
https://news.ycombinator.com/formatdoc
Honestly not a bad theory. There’s definitely a huge disparity between actual productivity gained by using agentic coding done somewhat properly… and a non-stop wave of vibe coded work causing outages and churn. Pre-Covid hiring coupled with the high enterprise pricing for AI plans, it would make sense.
infrastructure changes slowly. once its built its not clear what you are paying 1111 people for.
If you listen to people on HN you could think AI is not increasing productivity or is even having a net negative effect.
I think the reality is different.
In this thread I saw the resume of an engineer affected by this Cloudflare layoff. In the resume he claimed that adopting opencode in his workflow, he shipped an integration in half the time it took peers without AI assistance for similar projects.
I’m sitting in an airport after spending a week with a client. They’ve killed off one of their enterprise saas subscriptions with an internal ai assisted effort and are looking to kill more. Granted, they are extremely competent but software isn’t their business. There may be something to the saaspocolypse.
I've seen non-tech people building internal tooling that engineering just never had time to get to. Small/lean companies are leveling up with AI, and they aren't carrying the salary overhead of the big companies. The big companies are going to have to get that much more productive in order to compete and/or they are going to have to cut staff.
Shipping is just a milestone. We all know that "AI" can produce code much faster than any human.
Productivity should be measured over time and take into account the cost of maintenance, reliability, amount of issues, etc.
Are they taking the piss by hiring and firing the same number as their public DNS IP ?
Their main DNS is 1.1.1.1 but their secondary is 1.0.0.1 not 1.1.0.0, so close but not quite.
The "as many as 1,111" number was:
> The number of our intern goal, a nod to our 1.1.1.1 public DNS resolver, is intentional.
But like the sibling comment says, "over 1,100" does not reference any of their resolver IPs anyways. In all likelihood, they hired fewer than the maximum of 1,111 interns and they are probably chopping slightly more than that here (max vs min).
Also it's funnier to make jokes about hiring people, than it is about firing them.
Wanna bet they are firing in groups sizes, that match exactly CIDR subnets?
That doesn't make much sense as a distinction, though it's a fun brain teaser to see why.
CIDR subnets can be as small as /32 (an individual IP). Even in the case we take the strictest IPv4 formatting requirements (no assumed 0s and no extra leading 0s), that'd be any layoff of 1000-259999 employees. Exceptions start to appear after that, e.g. 260.0.0.0 would be invalid and there is no other valid way to group the last three 0s per the strict rules.
Say we modify the question to just /24 subnets (i.e. similar the classic class C sized subnet) while keeping the rest of the question and rules the same. Through similar logic, any press releases which round to the nearest 10 give essentially the same range, now 995-259994. Since press releases like this tend to use rounded numbers ("over 1,100" seen here), essentially any large layoff could be read as a /24.
One thing I would bet on is "If you try hard enough, you'll eventually manage to find patterns where there aren't any".
Those 11 damn lucky interns!
The 1%!
100x-ing with claude. Code not outcomes, but still!
Serious note you dont really hire interns. They are a contractor (and hopefully apprentice who is looked after) really.
The 0.990099...%
About as awkward as "Q1 revenue up 34% YoY". https://www.techmeme.com/260507/p43#a260507p43 https://www.bloomberg.com/news/articles/2026-05-07/cloudflar...
Wonder if they'll do it like they did for Brittany Pietsch. She recorded her firing video some years ago. I think it's on tiktok but there are youtube videos discussing it as well.
Anyway, new employee at Cloudflare, just finished onboarding. Suddenly a short meeting is scheduled with two people she had never met before. She is told she is let go for "performance" reasons. She kind of tears into them with "what performance issues, I only got great reviews" just to hear the HR people squirm and backpedal, well because, they know they are lying. But of course, they're trained enough to never admit it and say "they'll get back to her on that". Needless to say, it has the same effect as a suspect being arrested arguing with the cops. But it did make Cloudflare "famous" on tiktok for a bit.
I found that video and I couldn't finish watching it. TBH it's really incomprehensible to me why we've created a culture where being so heartless is praised upon.
That's how the world works, we just automated and hidden most of the disgusting stuff.
No. She raises a valid point "if the company overhired, then just tell me".
HR doesn’t squirm because they are lying. They squirm because they minimize lawsuit surface area as much as possible. I have been on the giving end of performance layoffs in big corps and there is an extremely strict script you have to stick to (both HR rep and me as the manager).
I saw the video you’re referring to and it’s completely unsurprising they clam up further when she became confrontational. You’re not gonna talk your way out of a termination unless you have some pretty hard evidence it was for something illegal.
That’s just what getting fired looks like and people don’t often get to see the process so cloudflare “became famous”.
How is obviously lying about the layoff reason minimizing the lawsuit area? It's ripping it wide open I'd think.
Most of the US is a right to work environment where a company can let someone go at any time for any reason other than the few protected class reasons. Many companies also have 90 day probationary period where they bypass internal company processes and let someone go, again other than for protected class reasons.
It's obviously hard when people's lives are upended, but no one complains when companies do a lot of hiring because the risk is lower.
Sure, but why lie?
They lie to get out of paying for unemployment I think.
I mean, look at them it’s a poor struggling company barely making ends meet /s
It starts with some things that minimize the lawsuit area, but over time it transforms into a habit of lying. It's company policy, you know? Don't question, just execute.
The point is that HR declining to engage with her questions does not prove that they were lying. Even if they have 100% ironclad proof that they're in the right, what possible value is there in having an argument about it? Will she feel any better, and will they look any better to social media, if they deliver a 5 minute lecture on everything the company feels is wrong with her and her work?
(What is true, and what the Cloudflare CEO did acknowledge at the time, is that the manager who she felt was giving her only positive feedback should have been the one delivering the news.)
Maybe for context: In systems with worker protections, lying about this can be a crime. For example in Germany, if you want to fire someone for bad performance, you have to tell him before about the problem and give him the opportunity to improve, more than once. Even if a country like the USA, one that has nothing but disdain for the working class, does not have any such protections, the moral sentiment of non-brainwashed humans will not accept such amoral behaviour. So yes, ofc she might feel better if given an understandable reason, and yes, they might have looked better on social media, and more importantly: They might have felt better after behaving like humans.
In Germany, this woman would have been only halfway done with her 6 month probation period and the company would not be required to do these things. Again, you’re assuming without evidence that they were lying; an obvious alternative explanation is that her performance was genuinely not satisfactory, and she didn’t understand or wouldn’t listen to the feedback she got to that effect.
Both of those are true assuming the lay offs come from different demographics.
You lay off 1100 who are late in their career for younger people who will work more hours for less.
You're building the future with new fresh people instead of the "dead weight"
Or it is just regular ageism.
Mmmm, fresh people.
Can we juice them?
You can but they are much better slow roasted or sous vide.
Like veal with a nice Chianti.
Isn’t this illegal?
Only if you're dumb enough to leave a paper trail showing that's what you did.
It seems it would be easy to show a pattern.
You would need some class action lawsuit I’d think? Need a good number of laid off people to join it and you need solid statistics that would convince a jury more than the corporate lawyers would with whatever HR covered their assess on paper have.
Is it not fine to just cut for pay rate? That should be easy
Is it legal to cut pay rates based on age? I doubt it. 'We didn't fire them, we cut their six-figure salary to minimum wage'.
No I'm saying you lay off your senior people. Not because they're old and you don't want to pay retirement but to save on payroll since they make more money than juniors.
After all, they're all just Claudr users now.
Just your average Thursday in American capitalism!
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)
Yes, and that makes working for a Swedish company so much better. You know you can’t just be shown the door at any moment after years of service and you get a lot of peace of mind which is worth more than the inflated salaries in the US. There is still a way to get rid of people, of course, but that goes a little like the Japanese do: just don’t give any important work to the person, or give them a bad performance review. People quickly understand they need to move on and they can do it with dignity.
Or if you really want to get rid of someone you can buy them out with a severance deal that is better than standard and hope they take it.
That also means that a) it's harder for younger people to get a stable job b) the bare minimum of work not to get fired decreases over time, which is bad for productivity.
https://en.wikipedia.org/wiki/Insider%E2%80%93outsider_theor...
If a significant share of your employees optimise in the sense of doing the least of work possible, without getting fired, you have a huge problem anyways. Usually, given the right conditions, people have intrinsic interest in doing a good job. Even if their motivation is more of the extrinsic type, there is more to it than getting paid.
Not everyone has an interesting or well-paid job. Or competent manager.
Yes, it only works in a high trust society where there’s plenty of jobs and people actually care about doing a good job (any company will have incentives, people can’t just sit around and do nothing, lots of social pressure too if you’re a slacker). But hey, that’s been mostly true (until recently, I hear immigrant unemployment is really high, while “local” unemployment is close to zero, but the official statistics sit in the middle at around 7% I think, much higher for the youth).
In my experience those people get juicy positions doing nothing useful as they their competence long atrophied due to zero pressure to keep their knowledge up to date. Of course now companies hire "consultants" to work around to issue, so those get fired on a week's notice when money is tight. The warm bodies remain in their chairs until retirement. Inefficiency remains a huge problem in Swedish economy, but no one dares to touch these archaic rules (BTW no minimal wage in a European country, WTF?) due to political reasons, so the immigrants get the blame instead for everything.
Its a choice - work hard with minimal securities, get better salary. Heck, one can do that in many EU places when working as self-employed on contract (if legal), and be paid by just billed days, no vacations or sick days. Its actually pretty good career path in the beginning of one's career in software development, get more money and ie invest in a property. Then get more secure permanent position, coast more and enjoy and appreciate more those stability benefits.
But high economic performance this isn't. Adaptability of market to ever-changing world that certainly isn't neither. Europe is getting hammered by this and things will get much, much worse in upcoming years. We will have to revisit our comfy lazy attitude towards work, or end up being a stagnant place with 3rd world salaries and corresponding QoL.
Switzerland is doing things much better, its sort of in between both extremes and economy is reflecting this very well. But EU leaders egos will sooner accept poverty than that somebody figured out things better than them.
The Netherlands recognized the problems with the last-in-first-out system and requires that after a reorganization, the statistical distribution remains the same. How well that works is hard to say because the level of unemployment in The Netherlands has been quite low for many yours.
What I hear is that Switzerland is a bad example. Many people there struggle to make a living.
> What I hear is that Switzerland is a bad example. Many people there struggle to make a living.
The poverty rate in Switzerland has increased (source:https://www.bfs.admin.ch/bfs/en/home/statistics/economic-soc...) but is defined as:
The poverty line is derived from the guidelines of the Conference for Social Welfare (SKOS). In 2024, it was on average CHF 2388 per month for a single person and CHF 4159 for two adults with two children.
I live in Zurich (by far the most expensive city) and while 2388 (or 4159) would be tight (depending on housing) it would still afford you a fairly comfortable life with access to top quality healthcare and public transport. Life quality wise one could argue that poverty in CH is a better option than a middle income in a lot of European countries.
Yeah Switzerland has rather few poor people and very strong middle class. And poor ain't some US version of homeless/trailer park living, just lower income, less fancy clothes, shopping in cheaper supermarkets, less/no vacations abroad.
Outside of Zurich rentals are not even that bad. You can easily get a nice apartment for 1500.- or even less. If one is struggling financially, rents are lower e.g. in Aarau district, starting from around 1000 and you can commute from there. Spending 1000 when the median salary is around 7000 is really not that bad. Low inflation in Switzerland meant other European locations are now at the swiss level or sometimes even above.
lol does all of European tech companies combined even make more than what the EU brings in from taxing US companies yet?
Why don't you research this and report back your findings. Learning is a cool experience, compared to prejudice.
Just for others, it seems this was already an article so it came up quickly, but for fines, not taxes.
"In 2024, the total income tax paid by all publicly listed European internet companies combined was approximately €3.2 billion. This total, which includes firms like SAP, Adyen, Spotify, and Zalando, was notably lower than the €3.8 billion in fines the EU collected from US tech giants in the same year"
China is hiring engineering talent. US is firing. Nobody forces anybody to do anything. Just pointing out the current state of affairs in the long life cycle of empire. As Ray Dalio says US is very late stage declining „financial capitalism”. While China is early stage aspiring „production capitalism”. It is not like late stage declining USSR needed as many engineers as it did when it wasnt collapsing. USA is a collapsing empire. China is growing.
from what I know, Chinese engineering grads are becoming food delivery couriers because there's not enough opportunity?
Making it illegal would be communism
Yes because anything that is good for individuals is communism.
People are feeling more alone than ever. But whatever you do, don't do anything communal!
Anything I don’t like is communism
Would it be Communism to require a license stating you know what that word means in order to use it?
In the United States (where most Cloudflare employees work):
To answer your question: Probably not. Even so, it is incredibly hard to prove workers 40 and older were laid off as a result of age discrimination.
> Even so, it is incredibly hard to prove workers 40 and older were laid off as a result of age discrimination.
The only way for this to happen is by leaked private conversations, I think.
So you can’t be discriminated against if you’re less than 40, but that seems somewhat discriminatory (maybe you wanted to be), but that means that you are being discriminated against, but that’s meant to be forbidden.
I sense a paradox.
Yes, from a legal perspective this will always be true: in-group vs out-group. Age discrimination is a special category because everyone will be in the out-group (when young) the age into the in-group. In this case, it is probably legal to fire someone for being too young. It sounds weird, but that is not a protected class of employees.
There's no paradox.
The law is you can't descriminate against a protected class. Lots of things are protected classes, like race and religion. Old age is, but young age isn't. Clothing choices in general aren't, but if it's a religous choice, it likely is protected.
Etc.
It's kind of weird that you can fire young people because they're young, but not old people because they're old. But it's not a paradox, it's just how the system is codified.
Technically yes, IBM just got sued successfully for it.
That said they just settled the case for what happened in 2016. So you might be right and even win but that wont help you for a decade (assuming you win at all)
there's no way 1100 interns are all going to be offered full time jobs
> You lay off 1100 who are late in their career for younger people who will work more hours for less.
Yet management always seems to miss the institutional knowledge, and experience, that also walks out the door laying off those 1,100 people 'late in their career'...
It's not possible to cram 25 years of experience into two.
How do they miss them? Companies just move on from what I’ve seen.
Half of Cloudflare employees have less than 3 years in the company.
Hired as a code monkey, fired as a code monkey.
> Yet management always seems to miss the institutional knowledge, and experience,
If they actually miss it they can call it back to work for triple the going rate.
They usually don't though. Those left behind have to figure it out again with whatever new tools they have at their disposal, thus continuing the great circle of corporate life.
Or corporate death if they don't figure it out in time and it is actually important. But even then, the management won't miss anything.
Most of the time, management don't even know what they don't know. As a result, entire America lost engineers and builders and now don't even know how to build rails, factories and rockets to moon.
Have you missed that they recently sent a rocket to moon?
Well, rails get made as well, I think the point was that a lot of things require reinventing knowledge that was previously known.
Or phrase it as reusing exiting tech because "it is cheaper" ending in having to reinvent it because all the people who designed it and made it have gone.
IT isn't even clear that is bad - SpaceX is famous for designing rockets from scratch that are better than the old technology everyone else has been using.
This is the internet. You can’t expect HN or Reddit to be positive, especially around America. It was the same way before Trump was around.
These people and bots have no idea what they are talking about. They’re parrots.
That happened in the reverse way. The government fired and underpaid a lot of people at Nasa ... and Musk hired incredibly experienced people, who became experienced on the taxpayers' dime, to build a rocket, for huge payrises.
The biggest but not only example: https://en.wikipedia.org/wiki/Tom_Mueller (yes, lots of subcontractors involved, however, Nasa paid, with a bonus percentage provided by the US military)
Note that Mueller gives the payment situation at TRW, and the fact that he "wasn't appreciated" as a direct reason to go to SpaceX.
What did you think happened? Does anyone actually believe Musk did the technical design for that engine, just because he claims so? Or I should say he constantly claims it, staying slightly away from direct claims to avoid getting caught in lies (well ... getting caught AGAIN).
SpaceX has nothing to do with any part of the Artemis II crewed lunar fly-by. They were considered and rejected. It was entirely legacy aerospace contractors. SpaceX is under contract for parts of future missions including the lunar lander.
They sent a module around the moon. They didn’t send a rocket to the moon. They still haven’t landed and their timeline keeps slipping.
Relevant post with some military examples as well:
https://techtrenches.dev/p/the-west-forgot-how-to-make-thing...
(Has some AI tells though, probably AI-assisted?)
I'm very sympathetic to this standpoint, but an obvious retort is why don't the engineers become their own boss and do better? What's stopping them?
I'd imagine it's access to capital and resources. I suspect many engineers/professionals (especially in eg consulting or manufacturing) would start their own business if they have the financial stability to do so.
A lot of market forces tend to "naturally" create monopolies/oligopolies. For eg if you're the biggest steel plant you can operate efficiently and keep moderate margins, beating any plants not as big (economies of scale). An independent guy (or even the entire team) can't just open a new steel plant shop down the road, even if the current one sucks.
Haven't software engineering salaries been like 200K for almost a decade? With very little actual need in capital requirements relative to a host of industries with expensive equipment, I'd say of the class of workers most poised to start their own businesses, I'd say you guys are the best placed.
To be a bit honest, I'm a computational scientist who's never seen anything near 100K and likely never will. It's hard to imagine not having around 4 times my salary and not being able to start something myself.
It gets sucked up into housing. So if you're in your early 50s that's fine as you probably brought very cheap. Mid-40s and under? Unlikely unless you were extremely lucky. I'm 45 by the time I've been able to buy housing it has always been peak despite having very high earnings at times.
> I'd say of the class of workers most poised to start their own businesses, I'd say you guys are the best placed.
I think your premise is significantly correct; things like launch HN (and even YC startups) are heavily software biased. I suspect you'll find about a hundred product hunt products for every physical kickstarter/indiegogo.
To start a $100M software company you need 5 engineers and 5 laptops.
To start a $100M hardware company you need $500M.
Software is a tragedy of the commons situation where anyone smart enough to engineer is smart enough to learn pointers and objects instead of shear stresses and voltage fluxs.
Nevermind that software pays much more with a much lower barrier to entry.
You might be surprised how easy it is for some people to make 200K and end up in debt...
In most companies and industries it’s closer to 100k to start.
what?
Managing things often requires a different skillset, some want to avoid solving meatspace problems, some are not destined to be good at it.
Engineering and running a company are very different skill sets. Engineers are often not good at Marketing, networking, sales, ...
Even if you are good at those, for many companies, it's more about connections than about the ability to build stuff. So if you don't know the right people, it is very difficult to get a foothold.
Sorry I should have specified, engineer here means software engineer/software developer.
You missed the question entirely.
Marketing, networking, and sales are the job. Or a large part of it. If you don't have connections, knowing how to make connections is part of it.
Accept that there are other skills besides engineering, and they can be just as challenging to learn, and just as opaque from the outside of you don't understand it.
Capital.
I have AuDHD - there is no way I'm running my own company. I'm a good developer but I need someone else to have the idea and run the business and I can lead a small team to bring it about.
Given I'm now in my mid-50s, things are looking grim. And I'm not getting paid SV silly money. I'm not even getting paid US dollers.
That's basically the meme, right: You rail against corporations and yet you work for one. Curious.
Anyway in general, corporations are sticky. They save resources through scale and collaboration. Famously this is a problem for free market true believers because if you believe that the market is the most efficient mean of organizing people then you would expect firms to operate internally as free markets (or disappear). There is a whole body of work about it,
https://en.wikipedia.org/wiki/Theory_of_the_firm
In practice you can't just become your own boss and compete against firms.
Most people in fact do not work for corporations. But small companies rarely get into the news do they?
I don't have the link to the US census bureau in front of me, but I think as of 2018 more than 50% of employees worked for firms with >500 employees.
And, of course, there's nothing preventing a small/medium business from incorporating, either. "Corporation means big, small business is a different thing" is common shorthand but not actually how it goes.
The vast majority of people working for small companies do not earn much. A few doctor firms, and high end legal/engineering firms maybe, but most employees of smaller businesses lose out on total comp to big businesses, and government.
It takes two years to get up to speed on a job. It seems laying off will cost the company time even if they are saving money.
>If they actually miss it they can call it back to work for triple the going rate.
That’s great in theory, it rarely works in reality. Those people almost universally find new work quickly because they’re good, or retire because they can.
In both instances the idea of going back to bail out a company that just screwed you, operating with a giant target on your back when the inevitable next layoff occurs, isn’t worth it for 10x the salary. Ignoring the fact a business of any significant size isn’t approving paying someone to come back for 3x, they’ll just caN the manager for the fallout.
Do they always miss it, or is it that they are aware, but disagree on the cost-benefit of hiring experienced engineers?
This is contextual on a number of factors. It seems difficult to establish in the general case.
I've never seen evidence that companies value experience. They hire outside CEOs instead of developing and promoting from within. They move managers to new rolls all the time, and thus everyone needs to learn how to manage a new boss. My local school district did the same when the superintendent retired - found a small local school district and hired their superintendent away instead of using what should have been a pool of assistants who already have experience in local problems.
I'm not sure if it matters or not in management. I believe it does in engineering.
Maybe that's why they hired first, and then fired.
Give the new people 6 months to benefit from all that institutional knowledge.
Lately it feels like it's possible. Freshers in their first job are now capable of taking ownership and shipping full stack features in a few weeks. The feedback loop is definitely shortened - noone appreciates the years spent "googling and looking at stackoverflow" anymore, and frankly, they shouldn't be. Experience matters now mostly at the architecture, and decision-making levels, not at implementation.
I was reviewing some code done by a junior hire at my company last week, and it certainly didn't look like he was cramming 25 years into 2. It looked like he had no understanding of anything he had generated, because it was garbage. Meanwhile this week I've just reviewed the largest single PR I've ever seen, from a senior dev who disclosed it was mostly generated and cleaned up by him, and the code was perfectly fine and it was a breeze to review.
LLMs are a great tool, but more often than not it does show if the person using them knows what they're doing or not pretty clearly. Especially if it's anything larger than a trivial small change.
Yeah they seem to just amplify who ever was behind it.
Freshers certainly can give the appearance of taking ownership and shipping full stack features in a few weeks.
The problem is that "I copied the issue on claude code and then committed the code it produced" is not actually taking ownership.
> noone appreciates the years spent "googling and looking at stackoverflow" anymore, and frankly, they shouldn't be.
Well, I do, and I hard disagree with you there. If the human does not understand what the machine is producing, then I need a different human.
Every time i see a comment chain like this i'm annoyed. In the last 3 decades we never truly found the words to define what kind of skills, problems, and people /-space exist in the industry, and AI has literally added a whole axis to the space so we're more unable to communicate than ever.
Having said that, and feeling more with you than the other guy, there is nothing for you to "disagree" with.
Mediocre was always buggy and broken in some ways, but for all intents and purposes it was good enough. Today somebody with a year of study can reasonably deploy something - for which the appearance of taking ownership and shipping a full stack of features has reached the bar of good enough.
Consider 10 years ago: Did you believe it was more likely that in the quality-distribution-of-software that we would, over time, create proportionally more quality? I dont think so and AI didn't meaningfully change the trend.
It changed the work dynamics, and still is changing, and with our inability to communicate is going to be an annoying mess.
Dont let the annoyances blind you to what LLMs can do for your point in space, or to where most of the points lie for the rest of the world.
The problem with AI isn't that it's mediocre, I can work with mediocre. The problem with AI is that it produces absolutely stellar world-class code with two hidden 0days in it.
I can't work with that sort of surprise. I'm tuned to consistency, and I can work with consistently bad, but not with "95% absolutely amazing, 5% abysmal".
And I say this as someone who develops exclusively with LLMs now.
> it produces absolutely stellar world-class code
I am using Claude Code with Opus 4.5 and I have to correct it every day. It produces working code but it makes mistakes. The code is more verbose than it should be, misunderstands/ignores edge cases, etc. Daily.
And I am not a stellar world-class programmer. I am pretty average. I just read what it produces.
> I just read what it produces.
I don't think that's average right now.
With junior programmers I typically just look for high level patterns that are commonly wrong. Sure if they are touching our cross thread communications code I need to spend a lot of time on that because it is so complex nobody gets it right - but we only have a tiny amount of that and most people look at it and run the opposite way (even me - I wrote it but I still do my best not to touch it when I can avoid it - that is hard hard hard)
I was disagreeing with "they shouldn't be".
I think we should care that our engineers have put the effort to understand the code they are responsible to produce. I don't care specifically about how they get that knowledge (I am using AI to learn myself, for example). But I disagree with the implicit assumption on the statement, which is, in my view, "humans don't need to understand the code any more" (because some fresh out of university might think they understand, but they really don't).
I'm not talking about some hypotethical scenario - but what I observe. When I started out, us interns were tasked with "nothing". Now the skill floor is so much higher, and I'm seeing freshers accomplish tasks that were previously thought of strong mid-level or early senior ones.
Well that is not my experience. My first task as an intern, decades ago, was performing a useful task for the company that hired me. I did a mediocre job at it and it took me way longer than it would take one of the experienced engineers there, who would have done it better. That was expected because I was an intern.
With the tools available now, I would have been able to produce things of higher quality and faster, I don't deny that. But putting that code in production without an experienced developer reviewing it thoroughly would have been reckless. And they would have been the owners of that code, not me.
Can't wait for the next couple of outages! Let's see how long it will take.
> seems to miss the institutional knowledge, and experience
Or the exact opposite. Not every institutional experience is good and useful. Some are quite the opposite. I mean, term limits are one of the most common democratic institutions for precisely this reason. We WANT some knowledge and experience to walk out the door.
>Both of those are true assuming the lay offs come from different demographics.
That's the point.
I don't think a 17 yrs old company has that many long tenured people!
Being old doesn't always mean "dead weight". They are dropping experienced people, so from where are young people are going to get experience?
AI will mentor them /s
You're almost defining part of, or the beginning of, the process of enshittification.
Surely they wouldn't keep all of the new hires.
Laying off people with experience which only 1% of their younger colleagues will learn because LLMs made it redundant enough is misguided today. If I were a CEO I’d hold on to my 15-20 yoe engineers for my dear life; can lay them off in 2028.
>You're building the future with new fresh people instead of the "dead weight"
If the "future" being built is one that those same interns would be dropped as "dead weight" as soon as they settle into families and refuse to be exploited with overwork, then it's a bad future, even if it's one with more CDN features.
Although, instead, it will be a more enshittified one anyway: they're cheapening your company and the product and lose organizational and operational knowledge in the process.
But the truth would likely be closer to that those fired would be a mix of mostly extra people hired plus some older employees. But instead of "we hired extra X less than a year ago, we shed X now", it's rebranded as "we reduce our workforce thanks to AI" to get possitive press and appeal to the less bright small-time investors.
Cloudflare is a public company.
The incentives do not allow it to look more than a year (and in a lot of cases a quarter) down the road.
"Public companies" with incentives shaped that way are a driver of bad outcomes
The future might have more outages then.
yes sure. its pure accounting and buying into the scam that genai+junior will reduce costs. meanwhile they tokenmaxing vibecoding uis for 50% of their wages cost. I will short every company making those moves.
Yes, left is right, up is down.
I always wonder what happens to institutional knowledge in American companies.
You're expecting the country that's all-in on anti-vaxxing, climate catastrophe denial, and the disassembly of democracy to understand what institutional knowledge is?
Them capital class is all in on those things and owns all the media. But the majority of us are not.
Picture a space station where there's an error when trying to seal the door and they proceed anyway and it explodes from the pressure differential as all the air escapes out to space.
This is literally a scene from Interstellar
https://www.youtube.com/watch?v=a3lcGnMhvsA
what institutional knowledge exactly? all they know is politics and intrigues. zero useful knowledge there
anything thats useful is documented. If its not documented, there will be incident/outage and it will be documented later as a lesson
I worked in a company that did that. They couldn't rehire the senior after the junior burned with a bug 700k in 20 min by touching a part of the codebase no one had context for anymore.
There's an interesting assumption here that all people working at Cloudflare are great developers, and none deserve to be fired for poor code or laziness.
You know what's way more expensive than an old senior developer? The 10 interns you try to replace them with.
I'm also interested in the proportion of H1B vs US citizens in this layoff vs the last 1100 people they hired (minus overlap)
i saw this ALL the time at past employers. Employers higher all kinds of interns who eagerly get truck loads of work done and build great connections. and 2 years later the company is getting sold off, out of business, or mass lay offs all over the place. what's the point of highering all those interns in the first place?? geez.
>mass lay offs all over the place. what's the point of highering all those interns in the first place?? geez.
If you don't hire them, someone else can hire them. Out of 1,000 you hire, one could be an "attention all you need" research paper writer, who could set up the next stage of innovation which you'll completely miss if you do not get anyone.
Initially, you’ve got to starve out the market of talent to stop competition from growing by nipping the threat in the bud.
Future can pay for all of this if you succeed.
> Out of 1,000 you hire, one could be an "attention all you need" research paper writer, who could set up the next stage of innovation which you'll completely miss if you do not get anyone.
I have worked with people of this caliber. The company did nothing to retain them, and the company did not retain them.
Every time. Without fail.
Well how can they have the time or resources to invest in retaining talent? They're busy hiring more interns, where one could be an "attention all you need" research paper writer, who could set up the next stage of innovation which you'll completely miss if you do not get anyone.
I am part of Management in my company. We explicitly maintain a list of key people in the company we don’t want to lose. The truth is that just a few people are what makes a company. Lose them and you are in trouble. Some companies don’t seem to understand that, but perhaps after a certain size, it doesn’t matter anymore! The machinery just keeps turning.
I met a guy this happened to. He got a special award within the company, asked for a bit of equity, didn't get it, in fact got blacklisted and booted out.
Luckily for him it worked out very very nicely.
Yes. The intent is not to retain them or keep them happy, it's just to prevent them from doing inventive work for anyone else.
Liquidity in the currency market.
Need to propagate a lot of dollars fast, 24/7 as a moat on it remaining a reserve currency.
99% of these software startups are basic software that can be handled by a single dev; see Reddit apps and such.
But that money printer was running hot and heavy. Needed to funnel it somewhere. Why not that favorite political cudgel of the elites; pointless busy work jobs! Let's invest in a bunch of shops nearby for them to lunch at too!
All of these companies feed their workers in their posh corporate cafeterias while the restaurants around their offices remain mostly empty
Big tech, sure, but not all the startups. I can assure you having freelanced and mentored many a SWE at 5-20 person startups the last 6 years they are not all hiring pro chefs.
Have you not been reading the headlines about urban offices empty? Low taxes to create foot traffic for other businesses?
The trickle down of the ZIRP era was about spreading all the dollars they could print as quickly as possible to maintain dominance of the dollar.
SaaS apps are meaningless to future generations. We were never creating pyramids of Egypt like wonders. We were missionaries for contemporary American propaganda.
> 99% of these software startups are basic software that can be handled by a single dev; see Reddit apps and such.
This sounds like specious reasoning, similar to the tired old interview question "how would you design Twitter".
Twitter is just a table in a RDBMS, isn't it right? Any fool implements that in an afternoon.
Except it isn't, and the actual complexity of real world software often lies in festures you are completely oblivious.
> you are completely oblivious.
Sounds like specious reasoning similar to the tired trope of "someone is wrong on the internet and I must correct them".
Twitter is in the 1% not the "99% of these..." but don't let reading comprehension get in the way.
I was a phonics kid not a 3-cuing student. Reading scores have nose dived since phonics was phased out. So I understand it's not entirely your fault.
Interns getting “truck loads” of work done has not been my experience. Potted plant is a better metaphor.
> The number of our intern goal, a nod to our 1.1.1.1 public DNS resolver, is intentional.
Hiring and firing based on things like this should be a huge red flag.
I’m surprised they didn’t lay off 1001.
I realize those were interns, so maybe the expectation is they’re temporary from the start, but picking these numbers for marketing instead of need is silly.
Imagine if they hired those 1111 to do the most massive nine-month-long live coding interview and only 11 pass the bar.
Didn't know about Yogi Bera's quotes: https://en.wikipedia.org/wiki/Yogi_Berra#%22Yogi-isms%22
Some of these are unintentionally as witty as Mark Twain’s
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.
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 new folks coming in and most of it not making it.
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.
Absolutely not--the printer is capex, so it's preferable to the humans who are opex.
No no, this quarter we’re trying to shift from capex to opex. Try to keep up.
Usually, companies value opex more than capex - opex is much more flexible. That's one of the reasons why printers, coffee machines, companies cars and other things are typically leased.
Not really that simple. Opex gets better tax treatment (you can deduct it in full every year) but people aren't always Opex depending on what they're doing (research tends to be Capex)
Also tax treatment isn't the only consideration for financial engineering: It's easier for a company with a huge capital spend to argue that they're investing in the future and CapEx doesn't hurt EBITDA. On the other hand, some companies get worried about reporting a high "capital ratio" (ratio of capital assets to income).
In reality you can't say categorically that companies prefer Opex to Capex.
Concretely speaking, the FAANG companies are all wildly slashing opex (us) for capex (data centers, TPUs) even as the capex costs skyrocket due to demand outstripping supply.
Programmers are usually capex to be honest, with current tax treatment. When companies switched from data center to cloud they ended up shifting a lot of their compute from capex (buying servers) to opex (paying a hyperscaler for compute by the hour).
Of course if you're in one of the five tech companies building datacenters rather than renting (MSFT, Google, Facebook, Amazon, Oracle) then things are different.
We don't send 10% of our printers to the landfill every year just to motivate the other printers.
I take it you haven’t seen the printer demolition scene from Office Space?
/s
Damn, it feels good to be a gangsta.
You pretty much do that with wireless devices as a wISP.
> This is utterly disgusting
This is effective. Therefore, normalization of this plays into the workers' hands, gives them information, and gives economic advantage to honest agents.
I mean, you could compare it to any non-capitalist society, where such treatment of workers is declared unacceptable. But what does this translate into in reality? Such strategies are still effective and provide an advantage to those actors who adhere to them. But since firing workers for their relative effectiveness contradicts the proclaimed ideology, such workers are simply accused of random crimes against the country and executed.
so you're saying its not the evil that's the problem its the hypocrisy?
If both sides know it, working as a "churney" can be pretty chill. Like being put on the roof from the getgo.
Lol. Isn't this like being a contractor?
Maybe 1/10 of the new hires replace 1/90 of the existing old timers. You need some creative destruction.
You may knock this system but it's what made General Electric the company it is today!
Which is a F500 company.
> Which is a F500 company.
And used to be an F5 company.
The easiest way to become a F500 company is to start as an F5 company, then financialize your whole business, stop innovating, fire anyone effective, and give the executives huge bonuses.
Well, if you also put barriers to integration and hire more executives you can turn it into 3 or 4 F5000 companies instead.
Using human resources as moat to protect themselves when the barbarians come. Seems to Management 101
300% accurate
Company internal GDP equivalent increase of a funeral.
This is completely acceptable. When was the last time you saw any job seeker seriously enquire about such practices in interviews or at the application stage?
A lot of people here and in the industry in general seem to optimise for compensation package and put blinkers on themselves for other factors that are definitely relevant.
Companies aren't penalised by candidates for such practices. I'm not saying it's good but it's astounding to me the number of people who for example optimise entirely for salary and then are shocked when the working conditions are very poor.
People game companies and companies will game people in return. Murray Gell Man amnesia will kick in and next week there will be thread about how CloudFlare is a great place to work for software devs because you can earn 20% more than other comparable companies with no reference to how things like job security or working conditions are measured.
How exactly would you ask this in an interview setting? I'm baffled by the idea.
"Why is this role open"?
Either they will answer directly with something solid like "We're growing the team" or they will evade it which is still a meaningful answer for you. You could probe further with questions like:
"How has the team's headcount changed over the last 18-24 months?"
Basically you're alluding to 'employee turnover' without saying it.
You know that people just lie regardless of the real intent behind hiring right?
That's not how that works... Please stop being delusional
This is a bizarre take, I've always asked questions like this when interviewing, and if a manager doesn't have a good answer I ask for follow up conversations with the team before taking a job.
Has it worked out? No, but usually they were all being lied to by upper management. Can't do much about that.
> Has it worked out? No
It's a bizarre take because you have always done it and it has not worked out. What.
I missed a word in there, which was "has it always worked out", but on the other hand I've also dated a lot of people I didn't marry, and even in my original phrasing I think it would be very odd to not ask or try to suss out this information! If nothing else you'll learn later if people are truthful or not, or worth working with again in the future.
Naive to think such a question would get anything other than a plausibly ambiguous lie.
> How has the team's headcount changed over the last 18-24 months?"
“It didn’t change” and it would not be telling much. They are just hiring and firing X amount of people every year.
False dichotomy, the same team members could have been there for 24 months
I think we're saying the same thing? Just asking about team size won't reveal the answer. So a different set of probing questions might have to be asked.
Agree with the sentiment and this is a good idea regardless of skepticism about layoffs, but I think "we're growing the team" is not a solid answer.
This is a company that's potentially going to be giving you a lot of money. You should want to understand what they're hoping to get out of that investment. e.g. what are their short/mid/long-term goals and how does hiring you fit into that? Ideally it's clear to you that they have a lot of work they want to accomplish that seems reasonably aligned to what the business owners would want, and it sounds like something you want to get yourself into.
A great answer would be like "we've been acquiring a lot of customers lately and have been starting to run into performance issues, but we don't have the capacity to both handle that and also work on the feature requests we're receiving." Or "we're looking to expand into a new market which carries some new baseline requirements (e.g. FedRAMP) and need help building that."
There is no case in which they wouldn't say they're growing the team. It would also be true in all cases
S tier interview strategy (I'm not being sarcastic here).
They open the interview by asking why you want this position, at the end in your questions time, you ask why the position is open.
Software is an industry where most people stay 2 years at a job. The reason they have the position open is because the previous person quit.
In fact "we're growing the team" in a large company is the one that is a red flag.
> How exactly would you ask this in an interview setting?
You now know which companies do this.
Every company laying off now has to wear a Scarlett Letter: "we're a layoffs company".
Good luck working in tech for a company that's never done a layoff.
Just Apple (and even there only "mostly") among big tech?
I thought it was hilarious when they did their layoff a couple years ago just because everyone else was. It was portrayed by their announcement as though it was a business need that they tighten their belts, as though Apple, the company that makes twelve figures of profit every fiscal year were in some kind of tight cash flow situation. Really made it obvious that they saw the atmosphere as “good layoff weather.”
There are two kinds of tech company.
Companies which have done a layoff
And companies which haven’t done a layoff yet.
> When was the last time you saw any job seeker seriously enquire about such practices in interviews or at the application stage?
- “Are you hiring people just to fire them a year later to protect yourselves?”
- “Yes we do”
It’s a bit naive to think they’d just own up to it.
>- “Are you hiring people just to fire them a year later to protect yourselves?”
You think the naive part is the response and not that question?
My point is that you'll simply have to read between the lines on responses with leading questions not that they're going to be upfront about these things.
Also the interview isn't the only way to gauge these things, You can Google for layoff numbers as well and make determinations that way. There are some websites that are dedicated trackers of layoff announcements, both the loud and quiet ones e.g. Spotify I think were letting 29 people go per month for a while. I think the law in Europe was if was 30 people you had to announce it. I can't remember the exact detail but plenty of companies expose these loopholes.
You said "seriously enquire", now you're saying "read between the lines".
As if the L4 SDE phone screener has any idea how to answer that from their scripts
Do they need to own up to it directly? Interviews are always about both sides of the table putting their best self forwards. If it's a big enough company to implement stack ranking and the resulting games played then GlassDoor, LinkedIn, Reddit, even HN all serve this purpose quite effectively.
You can also just ask indirect questions: "how often do you hire new team members?", wait a bit and then, "how is the company measuring growth?" and then at a later opportunity "what's the tenure of those on the team I'd be working with?". If nobody with 1 -2 years is on the team but they admitted to hiring frequently and that growth is meager or stagnant (or they can't answer the question), you have your answer.
You could also just ask directly. I think it's a totally fair question. I don't think you'd be penalized for asking about a company's layoff history. Especially if you say something like "I'm looking for my next home, somewhere I can be for the next 5 plus years".
I might not ask in the first 10 minutes of the first interview, but once you're a few rounds of interview deep, you can pretty safely ask questions like this.
the deal you are signing is that if you show top percentile performance, it wont be you who will be laid off
Hunger Games basically
> People game companies and companies will game people in return.
You have cause and effect entirely reversed.
There have literally been movies and tv shows made about employees showing missplaced loyalty to their companies and what the companies do in spite of that loyalty, and now that the pendulum has swung to around a bit, you have the temerity to suggest it's the employees who started this trend and the poor employers are just forced to play the game? Fuck right off.
I see it all the time companies keeping people out of loyalty despite employee being grossly incompetent. But it would be hard of hear about it because what kind of news that'd be.
Hiring is event, firing is event. Not hiring or firing are not the event to cover.
> This is completely acceptable. When was the last time you saw any job seeker seriously enquire about such practices in interviews or at the application stage?
To put it another way: she shouldn't have been dressed like that, it's her fault for being raped.
> This is completely acceptable. When was the last time you saw any job seeker seriously enquire about such practices in interviews or at the application stage?
Well, this is not something you can safely ask in most interviews. Also, while there's some sort of HN/hackerdom fiction that the job seeker holds some power during the interview, for most job seekers the interview is strongly imbalanced towards the interviewer. So asking clever questions during the interview is risky if you're desperate for a job.
agree - every time you ask a "clever" question you're increasing the risk it will be mis-interpreted, and also giving the interviewers a chance to pass. You may think you're being intelligent, honest or candid but it can easily come across as cocky, confrontational and (for lack of a better term) "off". I've passed on candidates for all of these reasons.
While you can't really ask "will I be layed off next year," it's pretty common to ask some version of "why is the role open," usually split among a few questions (that you'd tailor based on the role):
- "Which of my skills do you think are most valuable for this role?"
- "How would you measure success in this role?"
- "Can you tell me a little more about the product lines we'll be developing / supporting?"
- "How is the current team planning to grow?"
These are the kinds of questions that let you feel out what the manager envisions for the role. If the answers seem vague, that tells you something about the role / manager / org. If it's not clear how you impact the product and they can't clarify, that also tells you something.
I hear you, but the answers to these questions in my experience are always of the kind "we're looking to hire capable people with skills X, Y, Z for projects A & B".
These don't give you any idea about the health of the company or how precarious your new job will be.
> When was the last time you saw any job seeker seriously enquire about such practices in interviews or at the application stage?
There’s some kind of reverse-survivorship bias here. I’d never apply at Meta because their management does the “hire a bunch of excess people in the good times, so when Zuck‘s next inevitable efficiency-drive happens, the team is able to layoff lots of people while still staying operational” approach.
So I’d never make it into the Meta interview to ask that question in the first instance, and neither would anyone else who thinks of Meta in that way.
Selection bias
In my experience Meta is more selective and in interviews software people Meta pushes them to their limits.
And now it seems they may be recording your screen all day long. What a wonderful environment.
This reads to me almost like saying “Why are pigs not avoiding the most problematic slaughterhouses?”
A. We have to work somewhere, and in 2026 honestly it’s actually the employer’s market which is kinda new to me, as someone who always just passively waited until an interesting job offer fell in my lap.
B. They all pretty much work the same. Everywhere is “like a family” and “cares about sustainability” and all, until either your VC money starts to run low and you sell to PE or liquidate, or, for your big techs, layoff season comes around and you need to show that you’re willing to cut costs with the best of them, so you pick a random 4-5 digit number to lay off for the investors.
I thought post Netflix the model had switched to “we’re a team, not a family” — like in MLB?
https://variety.com/2017/digital/news/netflix-company-cultur...
>This reads to me almost like saying “Why are pigs not avoiding the most problematic slaughterhouses?”
I don't think that's a fair comparison. Pigs are literally reared for slaughter and have no autonomy. Employees can and do choose these companies completely of their own volition.
> Employees can and do choose these companies completely of their own volition.
Except for the part where, some of the time, it's "this company, or I can't buy food or pay my rent".
I think you have to squint pretty hard to think that's the case in software engineering. LA Times suggests there are 6.9 million job openings (1). I don't think it's reasonable to suggest that anyone who wants a job in tech should get one otherwise its a humanitarian crisis. In fact, I'd say it's beyond unreasonable to suggest that.
Still, I do feel bad for younger folks trying to break into the industry - but "work for cloudflare or go hungry" is beyond a stretch.
1. http://latimes.com/world-nation/story/2026-05-05/u-s-job-ope...
Edit: Cloudflare is paying out terminated employees thru the end of 2026, imagining this is a case of people going hungry requires some very serious ideological capture.
> Cloudflare is paying out terminated employees thru the end of 2026
That's great that they're doing that, but it's absolutely not guaranteed, either in this particular case (prior to this announcement, i.e. when these people were hired) or in general.
But all of this ignores the more general point, which is that--for reasons which may or may not be their fault--some people are not in a good situation financially and for them being laid off is a big deal with very real risks. Just because that's not you doesn't mean it's not a real thing.
> Cloudflare is paying out terminated employees thru the end of 2026, imagining this is a case of people going hungry requires some very serious ideological capture
We were talking about the people interviewing and picking jobs in general, not specifically ones that had been laid off from CF.
> I think you have to squint pretty hard to think that's the case in software engineering.
Maybe not right now (though I imagine that varies a lot even now). But I've been there. I've gone from making plenty of money to 100k+ in debt and having less money in the bank than I need to pay the rent + buy food next month. Admittedly, that was after the dotcom bubble; but it left me with a mindset of not assuming everyone has a choice to work at the company they want to. Sometimes you need a job, and being picky about which one you choose isn't always an option.
Huge gulf between "sometimes you need a job" and "employees are pigs to the slaughter".
"I've gone from making plenty of money to 100k+ in debt and having less money in the bank than I need to pay the rent + buy food next month" is pretty intense. I'm sorry you went through that, but if you get ~7 months of paid time to job search and still wind up 100k in debt, there are definitely other problems. I don't think it's at all fair to characterize getting laid off from an extremely highly paid job as a humanitarian crisis.
Should tech companies hire more slowly and carefully? Yes, definitely. Does that actually help employees? I'm not sure, in this case they're getting paid more than they would have had they not been hired at all. Are there plenty of jobs available outside of software? Yes.
> Are there plenty of jobs available outside of software? Yes
None that matter, you're not going to reskill into another career in 3 months that severance covers or even a year
Agreed. I know plenty of people that are looking for jobs and failing to find anything good. People that I look up to; highly skilled developers.
Though it’s ridiculous to entertain the thought that one would pivot their career at the drop of a hat. Even just bumping into a tech stack will chain one to it as recruiters stare at yoe in a specific one and completely ignore anything adjacent, imagine doing anything more radical.
One can do it, but it’s a life changing, irreversible and likely damaging event nobody sane would take lightly. Absolute nonsense.
"I don't think it's reasonable to suggest that anyone who wants a job in tech should get one"
I understand your point, but this is the least bad world we're in. If you mandated no-firing or mandated year-long compensation for laid-off workers, you would be crushing the small business economy and destroying more jobs than you were trying to save.
Most job openings are fake. Ghost jobs are a real and growing problem as dishonest businesses use it to signal growth without the actual intent to hire.
> LA Times suggests there are 6.9 million job openings
Yeah sure. I've seen literally dozens of job openings in certain companies that match my resume pretty much perfectly. None of them ever bothered to respond when I applied beyond "nah, better luck next time" (even that is not guaranteed, some just ignore you). I have no idea what those millions of job openings are, really, but the fact is, when you're out of a job, you don't feel like you have millions of employers lined up to invite you. Especially after you spend a couple of months submitting resumes and getting no interviews.
> Cloudflare is paying out terminated employees thru the end of 2026
This is pretty generous, usually a couple of months is all you get, sometimes people don't get even that. With that kind of approach, working for Cloudflare becomes even more decent option, comparatively.
I hope people don’t gaslight you into thinking it’s something wrong with you. That was exactly my experience this year - and that’s completely new compared to 4 years ago. It’s the market that’s changed.
No, I have been in the field long enough and done enough things that I know I maybe not the best ever, but I am pretty good. I appreciate the kind words though. And I am lucky to have a good job too, now. But that's what happens in the field, and it's not only me - I have heard the same you are saying from multiple people over the last years. It's just how it works now. Maybe there is some super-elite level where you can just sit on your Herman-Miller throne and the unicorns come and bow to you and beg you to take a job with them. I know I am, while being pretty good, not at that level. And many, many other people aren't either, while still being pretty good. All those people don't always have a luxury of refusing a well-paying job just because they get a slightly wrong vibe about what could happen with the company years from now.
> Employees can and do choose
What criteria would you use? Companies that don't do mass layoffs excludes all big-tech. What makes you think that "seriously inquiring about such practices in interviews or at the application stage" will get an honest answer?
Maybe the answer is that choosing 'big tech' implicitly prioritizes salary over stability. Many people (even on HN) work at places other than FAANG (or whatever counts as big tech these days).
I cannot imagine a company or managee that engages in these practices being honest about them
> This is completely acceptable.
I dunno, treating people with cattle kind of feels like the less good option here. These people who get hired have their own life, with plans and outlooks and what not, and basically hiring someone just to have someone to fire later, feels really shitty and flat out ignoring that they're human too.
It's the other way around. Why do employees try to game the companies in the first place? Because most, or at least a very large portion, don't give a shit about their employees.
It's not just cloudflare. Amazon had been doing this shit forever (probably decades at this point), to cite an egregious example. As a mere mortal employee, its not like you have a lot of choices.
> lot of people here and in the industry in general seem to optimise for compensation package and put blinkers on themselves for other factors that are definitely relevant.
This strategy basically puts you in the top 5% earners though.
>This is completely acceptable.
No, it's psychopathic. Please, let's not pretend multi-billion dollar companies and your average worker are on anywhere near even footing. Companies always make a big song and dance about being great places to work. Nobody tells candidates 'you'll be expected to work 60h weeks to keep up with the workload here'. Candidates don't ask pointed questions about this because they'd be immediately disqualified. I know, I've been there.
The only company I know of that's open about their practices is netflix, and they comp appropriately for the risk. All other companies? It's basically word of mouth.
> This is completely acceptable.
Is it?
Or we need labor unions
> Companies aren't penalised by candidates for such practices.
When you have a mortgage to pay and a family and a COBRA package running out (in the best case), your willingness to "penalize" a company that is actually willing to pay you decent money gets progressively lower as time passes. Not everybody has FU money and can refuse all offers until an ideal employer shows up on the horizon.
It feels like it was the most beneficial implementing better decision making mechanics by replacing manager with AI, not lowly folks doing actual value creation.
LLM models have better reasoning abilities than these folks....
They are not as good at building an old boys/girls network though who help each other into positions of power and wealth. Companies within companies...
They actually are! LLM ATSes give better scores to resumes written by the same LLM.
Back in the late 90s a senior Microsoft exec explained this to me, they had acquired staff and continued to operate entire divisions which he described as "ballast". In the future, once the stock price increases slowed, they would be heaved over the edge of the balloon basket so that it could continue to rise. I often think about that.
old sysadmin trick: create large file on a disk and in a dire situation when DB runs out of space delete it.
Or on Amazon elastic filesystems... create giant files just to ensure you're in the right performance class for the files you do need (that was the official way of doing it for a while!).
Genuine kubernetes scaling strategy: add a do-nothing container that runs with a lower priority than your real workloads, that requests half a machine’s worth of mcpu.
When you deploy a new container, and all your nodes are fully allocated, that low priority container will get evicted, and your container will immediately get scheduled in its place. Then k8s will try to find somewhere to put that half-machine container. If it finds somewhere it fits, it’ll schedule it. If not, it’ll trigger your cluster auto scale to add a new node where that task can run, making sure the next container you want to deploy has some readily available capacity to drop on to.
Basically the same sysadmin strategy, automated.
old defence against unreasonably demanding manager: add deliberate pockets of slow processing as insurance so that when things get too hot about performance, you unclog a few of those to acquiesce management.
The classic Speed Up Loop
https://thedailywtf.com/articles/The-Speedup-Loop
Zero it first.
The term for this is „buffer hiring“.
I know a medium sized defense contractor that ultimately had to sell itself a few years because they did this.
They would come recruiting in bulk at our school only to fire the majority within a year to satisfy their stack ranking nonsense.
10 years later, the engineers they were protecting retired and they couldnt find anyone willing to work for them, even people still in school knew the reputation.
People are so desperate for work nowadays I don't think a negative reputation would deter applicants
Totally.
In companies that routinely layoff people for lulz, executives collect business units for layoff fodder to protect their key players.
It’s the proving ground for the sociopaths who rise up.
See: "The B-Ark".
This has a name, and also a poster boy.
Amazon's well known "hire-to-fire" [1]
https://www.inc.com/jason-aten/amazons-controversial-hire-to...
Amazon followed that model heavily until they basically ran out of top talent wanting to work for them.
That bit really hard when AI hit and all the top engineers wouldn’t even consider working at Amazon.
When I hear about Amazon, the first thing that comes to kind is "PIP[0] culture" even zo I don't know anyone who worked for them.
[0] Performance Improvement Plan aka the chapter where manger together with HR build up the convincing paper trail to fire a person.
I know 4 people who’ve worked for them, two on the same team, one who’s moved around various offices over a long period of time, and one who used to work for me but left to go there (and with the offer they were made I absolutely don’t blame them - we’d been hit hard by COVID and were in the midst of a salary freeze).
The first three of those people seem to have got on well there and mostly enjoyed it. The fourth had a miserable 8 months. Their manager was based in a different office with a 5+ hour time difference and was a complete nightmare, and they left of their own accord to another job on about the same money but without all the extra hours, stress, and terrible management.
I’m guessing Amazon is like other big companies: the quality of your experience will depend to a very large extent on your manager.
I feel like Amazon isn't a FAANG anymore. (What's the new A? Anthropic?)
Well FAANG is now MANGO and yes Amazon dropped out of the top tier of tech companies on the market per these acronyms. Theres a few others other there gaining popularity which also now exclude Amazon as a top tier tech company.
Amazon is successful on the boring utility stuff (logistics, building data centers) but is broadly seen as unable to execute on higher value add things, which keeps it out of the top tier. The AI misses really highlighted that.
I've worked with some Amazon fanboys who'd rave about being "bar raisers" and other assorted nonsense, trying to impress Amazon-derived "leadership principles" upon much smaller organizations. It left a very bad taste in my mouth.
I took one of those seasonal hire to fire Amazon roles, having thrived in Apple engineering for many years, and not needing to work really at all.
It was laughable that the manager thought he could brainwash me (who used to report one level away from Steve Jobs) into learning how to write code, etc. He was from country X and would protect another wildly inappropriate employee also from country X despite her being a geography graduate in an SWE role, I'd have to teach her, then she'd report to him she taught me what i know.
Unbelievably corrupt org, but amusing i had to admit. it wouldn't be amusing if i had been dependent on working there.
Country X is India, isn't it?
X was China. The people from India were genuine hard working, in our two pizza team, or whatever they call it.
Just want to point out that relational nepotism is human nature.
It basically needs to be brainwashed out of people in childhood to avoid having it happen, regardless of where they are from.
There is nothing wrong with relational nepotism in a vacuum, and also nothing wrong with brainwashing it away. Whether or not to brainwash it away is a cultural choice with tradeoffs in both directions.
That being said, IMO having a host culture brainwash it away in its own people while simultaneously welcoming outsiders from cultures without such brainwashing is very, very, very foolish. We either need to let everyone do it, or forcibly make everyone stop doing it. The current situation is ridiculous.
This is so ethically and morally odious I struggle to find the words to describe it.
I’ve managed people out. I’m sure I’ll have to do it again. I’ve even let people go during probation but, on the rare occasions that’s happened, I’ve seen it as a failure of the hiring process.
People have families, they have mortgages, bills to pay, and a powerful need to eat (Mal, Serenity?). The last thing I want is for someone to give up a stable job that allows them to do that to come and work for me only so I can fire them and leave them up the creek a few weeks or months down the line.
Our employees are after all people, human beings.
As I result I skew picky during the hiring process: if there’s any doubt there’s no doubt kind of thing.
Just awful behaviour here from Amazon.
On the opposite direction (but compatible overall view): if I think a candidate is marginal/on the bubble of passing, I’m much more likely to move forward with them if they’re unemployed.
Someone unemployed might be a little rusty (and thus get estimated slightly worse in the interview) but, more importantly, if they come in and flame out, they’re not worse off for the experience or at least not as much as if they gave up a stable job.
Yes, that’s completely fair, and I’ve done the same. I’ve also been on the other side and made it clear I’m available and happy to take a chance.
When everybody is going in with their eyes open I think it’s a different matter.
> People have families, they have mortgages, bills to pay, and a powerful need to eat (Mal, Serenity?). The last thing I want is for someone to give up a stable job that allows them to do that to come and work for me only so I can fire them and leave them up the creek a few weeks or months down the line.
Literally none of that is the employer’s responsibility. It’s just a business transaction. Having sufficient savings is the responsibility of every adult, never their employer. It is not the employer’s job to manage the employee’s cash flow.
Everyone, but ESPECIALLY those making six figures in tech, should have a six months of expenses savings account in cash SPECIFICALLY for this exact scenario. There are a million ways you might be without work for 2-4 months. It’s not an employer’s fault (or responsibility) that their employee is financially irresponsible.
It’s not the employer’s responsibility, but do you think it’s ethical to hire someone so that they can contribute to your firing metrics?
Only if they are being honest. Offer this as a 12 month temp contract with possibility of continuation. Offering a role as permanent but with unvoiced intent to let go, that's dishonest. Being honest is always a responsibility.
A LOT of people don't make enough money to put away 6 months of savings. You can be the most financially responsible person in existence, but if you don't have the money, you don't have the money.
Seriously, just how privileged can you get?
You missed the point by such a large margin it’s impressive.
I've heard this before.
Then COVID happened and employers didn't have 2-4 months of savings built up, and ended up shuttering due to lack of money immediately.
Also, since post COVID, we've had hyper inflation and a locked up housing market. $150 townhomes that a $50 family salary could afford are now going for $300. And rent has gone up to match.
I don't think the numbers not matching is because of anyone's personal financial responsibility. It's more from the Fed's and Congress's horrible actions over the past 2 decades and their financial irresponsibility.
Granted, grumbling about the powers that be doesn't solve the problem, which is why I fear civil turmoil will be here very soon.
Or it was a combined strategy - hire interns who will hopefully be able to replace some higher paid employees at lower cost once they learn the ropes. Then reduce headcount further replacing with AI.
Surely nothing will go wrong with this strategy !
Opus 4.6 was released between those dates
This and the crazy macro economic environment.
So they basically fired all the interns? Can anyone who works or knows someone who works for Cloudflare can confirm?
I doubt it. Interns are cheap. They've replaced paid staff with interns!
Why should a company continually grow in headcount?
Worst way to grow the company by 11 people
This (from the September 2025 post) now evokes the Curb theme:
> Like you, we have seen numerous reports that more and more firms are capping their total headcount in favor of leaning on more AI tools, leading to downsizing their intern and new-graduate hiring. This is resulting in increased sidelining of new college graduates. But we think this misreads the moment completely, so we’re heading in the opposite direction.
> While we are excited about what AI tools can help do, we have a different philosophy about their role. AI tools make great team members even better, and allow firms to set more ambitious goals. They are not replacements for new hires — but ways to multiply how new hires can contribute to a team.
> AI tools make great team members even better
This is the predominant (public) talking point. And it’s true.
But along with that: when you have effective people becoming even more effective with AI, it becomes glaringly obvious who the INeffective people are. At which point it becomes hard to justify keeping those people around.
(That often includes people who are otherwise effective but aren’t utilizing agents and are therefore losing their edge.)
Losing what edge?
Before AI, it was impossible to measure productivity. Some tried with misguided metrics like lines of code added but that just incentivized writing obtuse code.
What has changed?
Impossible to measure in absolute terms but I think it's clear productivity increases relatively when LLMs are used. At least that's my strong experience.
vibes maybe?
If effective AI enhanced SWEs can ship features in a week, the guys who ship 1 feature a quarter stand out more?
Quality matters as well as speed though: reworking comes at a cost, so you really need to be tracking more than one metric. A lot of problems are caused by optimising for one metric above all else.
If it takes 1 quarter to develop a feature and a developer ships a feature in 1 quarter then that makes sense.
If it takes 2 weeks to ship a feature and a developer ships in 1 then yeah, I'm highly suspicious of that.
Now you can ask "Is it easier to ask an AI agent to do X than asking my employee?"
Good metrics is difficult, but sometimes a simple comparison like that is enough.
Stuff just gets done, I guess? Projects move faster, people onboard faster with less intervention, etc. The speedup seems noticeable enough that it doesn’t need precise measuring.
It's weird to fire people instead of giving them training.
Training can be socialized by asking people to take govt loans on further education and then letting the people default on them. Why should company spend their profits on it? /s
I know you're arguing a more general point, but it's worth pointing out in their layoff announcement, CloudFlare is claiming:
- This is NOT performance related.
- This is NOT a cost cutting exercise.
They say both things explicitly. What they don't say very clearly is what the layoffs ARE about.
That to me is a pretty clear reason to question the accuracy of those two claims. Insiders are saying that even people who were performing well in very profitable groups are being cut, which is hard to square with the stated motivations.
Agreed. One of the two things must be false. But that's what they are saying (not saying I buy it).
> This is NOT performance related.
It's important to say a large layoff isn't performance related, because it helps those who got laid off find new work. Even if it was all performance related, you want someone else to hire your former employees.
And, in a large layoff, it's likely to be at least partially true. Large layoffs work better when they're done quickly, when there's signs of layoffs but no information, many people will head for the exits themselves... which helps your headcount numbers, but ideally you want to keep people who are good at figuring stuff out and taking appropriate action and instead they've left. So... lay off people who are 'known performance issues', but also lay off some whole teams that have a mix of performance, and then do some random assignment and catch a mix of performance, because getting direct managers involved to pick who goes means having too many people know about the lay offs.
> This is NOT a cost cutting exercise.
Yeah, this one isn't credible. If it was about something other than costs, like pivoting to a new market, you would offer first choice of jobs for the new market. Even if it's look at our productivity, 20% of our employees have nothing to do, it takes a lot of spin to say not paying them to twiddle their thumbs is something other than cost cutting.
Didn't a few large tech companies fail even that low bar of decency? I seem to recall news of layoffs in the not too distant past where the employer openly let it be known those chosen were chosen for performance reasons, e.g. https://www.cnbc.com/2025/01/14/meta-targeting-lowest-perfor...
They are lying about it not being a cost cutting exercise
I think this sends a clear message. And the message is this: "Don't work here! You will be f*d! Soon!"
(it also sends clear message to the clients: you will have to suffer through the cheapest to run AI agent in case of troubles, because yes, we care the most about Wall Street guy's income, not anyone else's, we save money on everything else anytime, even when we don't have to)
Quoting from the links you shared:
> Cloudflare aims to hire as many as 1,111 interns over the course of 2026. […] That’s why this significantly increased class of interns will have a special focus: to ramp up the creative and widespread application of AI with a fresh approach.
vs.
> The way we work at Cloudflare has fundamentally changed. We don’t just build and sell AI tools and platforms. We are our own most demanding customer. Cloudflare’s usage of AI has increased by more than 600% in the last three months alone. Employees across the company from engineering to HR to finance to marketing run thousands of AI agent sessions each day to get their work done. That means we have to be intentional in how we architect our company for the agentic AI era in order to supercharge the value we deliver to our customers and to honor our mission to help build a better Internet for everyone, everywhere.
lol
Those 11 be Boaz & Jachin of building the Cloudflare's future.
More than enough to vibecode it down.
Turns about they only needed 11 interns.
11 interns did okay.
The 1% always does ok
Why do we need to complicate here? cloudFlare is not making any profit. They are losing money.
The board probably wants profit now (they predict less growth) so the management needs to cut the costs.
This AI story is a just an excuse. If there is not AI they will say “high gas prices”. Or “inflation”. Or whatever …
It is true that the companies like Meta, Oracle and Microsoft are laying off due to AI but because they need money to build compute power.
There are some companies who maybe do lay offs due to AI replacing employees. But this might not be the one.
I'll just point out that this is exactly the point in the corporate character arc where every company before turns evil.
I never liked the idea of every web site in the world using CloudFlare, but I like it even less now that they're struggling.
> so the management needs to cut the costs
I love it that they explicitly say in their blog post "this is not a cost cutting exercise".
Of course, every "regrettably..." letter from company execs is understood to be an entirely performative ritual.
One smart old guy once told me that the only language you need to speak in the financial world is spreadsheets. No words needed.
> They are losing money.
They have $4b in cash and Q1 FCF $84m, and 70% gross margin. They can become profitable anytime they want.
And apparently “anytime they want” is going to be this year.
What's the reasoning that software companies don't have to count R&D into gross margins?
> They can become profitable anytime they want.
By cutting 1100 workers!
…but AI!
Seems no CEO simply wants to say the company is under performing, we hired too many people, and now we’re resetting. But it’s clear that’s what happened on nearly all these layoffs.
None of these announcements provide any convincing evidence that AI is anything more than a convenient distraction from the real reasons for the layoffs.
First politics. Now businesses. This sounds like a wildly poorly written parody by teenagers.
"reduce Cloudflare’s workforce by more than 1,100 employees globally."
Are they 1) halting all the 1111 interns, 2) keeping the 1111 interns, now armed with AI, to replace mid-level/senior institutional knowledge or 3) a mix?
This led me down a rabbit hole - didn't know Yogi Berra was responsible for so many witticisms.
This seems to be the new normal in Big Tech. They regularly announce massive layoffs, but if you look at their size over time it stays stable or grows. Cloudflare size grew every year. Microsoft size was stable for the past 4 years despite all the layoffs. Google had lost some (4%) employees in 2023, but has grown back to 2022 size last year. Meta shrunk by 22% in 2023, but has been growing in size since then and is probably back to 2022 size right now.
These companies overhire and then downsize. This is covered up by the moronic narrative about AI.
Side note. You know who is steadily shrinking, though? Intel. Wild, eh?
https://www.macrotrends.net/stocks/charts/NET/cloudflare/num...
https://www.macrotrends.net/stocks/charts/MSFT/microsoft/num...
https://www.macrotrends.net/stocks/charts/GOOGL/alphabet/num...
https://www.macrotrends.net/stocks/charts/META/meta-platform...
https://www.macrotrends.net/stocks/charts/INTC/intel/number-...
> Google had lost some (4%) employees in 2023, but has grown back to 2022 size last year. Meta shrunk by 22% in 2023, but has been growing in size since then and is probably back to 2022 size right now.
Google's revenue in 2022 was $282 billion, in 2025 it was $402 billion (43% growth).
Meta's revenue in 2022 was $117 billion, in 2025 it was $201 billion (72% growth).
Surging profits paired with flat employment continues the concentration of wealth.
> You know who is steadily shrinking, though? Intel. Wild, eh?
Intel's revenue is falling ($63 billion in 2022 vs $52 billion in 2025), makes sense that they would trim headcount.
> This seems to be the new normal in Big Tech. They regularly announce massive layoffs, but if you look at their size over time it stays stable or grows.
Periodic layoffs always happen at all big companies.
I think it’s only surprising to people now because it’s being tied to the AI worries at the same time where we’re exiting an unusual period where layoffs all but stopped for a few years after COVID.
The layoff sizes are also larger because there was so much overhiring in those years after COVID. Some rebound effects in play.
Interestingly, at least on my browser, the bottom of the Y axis is not consistently zero from chart-to-chart, which distorts the message being conveyed by these charts.
I wish tech companies would start building great products again, rather than trying to build the future. I've kind of had enough of Tech's vision of what the future should be.
This paragraph from September 2025 didn't age well:
Like you, we have seen numerous reports that more and more firms are capping their total headcount in favor of leaning on more AI tools, leading to downsizing their intern and new-graduate hiring. [...] But we think this misreads the moment completely, so we’re heading in the opposite direction.
That one guy must be really good at the job. Congratz.
Also how EMs in amazon construct hunger games. Just hire a person every now and then so they can let go of another to prove you made your team better on some non-sensical performance evaluation axes..Cue the hunger games.
> The packages for departing employees will include the equivalent of their full base pay through the end of 2026. Healthcare coverage is different across the globe, and if you’re in the United States, we’ll continue to provide support through the end of the year. We are also vesting equity for departing team members through August 15th, so they receive stock beyond their departure date. And, if departing team members haven’t hit their one-year cliffs, we are going to waive those and vest their pro-rated equity through August as well.
The announcement reads as pretty heartless to me, but this is a very, very nice departure package
In Europe they’re pretty much obligated to provide this package
Complete fiction. Over covid it was common in big tech layoffs to get much less severance in Europe than US.
Definitely not true in the UK. This is extremely rare for it's generosity. I've never seen anything like this in the UK.
As a general rule USA Tech is much nicer to their employees both when working and during a layoff then Europe.
This one yes, extremely generous, but normal ones aren't.
Depends on the definition of "nice". Is it time or pay?
As always, it depends on the country.
I would be quite surprised if there is one, but if there is I would like to know.
They have a reputation to maintain, otherwise it will be difficult to recruit the best people in future. That being said, damn, that is a very generous package by any measure.
First packages tend to be the best. If you work for them beware, the next round won't be as good (if there is one). The economy isn't the best, but if you get an okay job offer anyway you should probably take it rather than risk you will be in the next round that is worse.
Meta did it based on tenure. People that were there for 10 years got about an entire year.
META is doing* it . The main RIFF has yet to happen.
RIFF = an awesome chunk based binary format
RIF = a really shitty way to run business
https://en.wikipedia.org/wiki/Resource_Interchange_File_Form...
Interesting
Dont' get it twisted, anyone; plenty of companies have a reputation to maintain for this reason (but don't do this). This is an absurdly generous severance package.
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.
This isn’t my experience, but I think it depends highly on the segment. We have mainly senior C++ devs (database company), and it’s still a challenge to find great engineers.
I think the current job market isn’t “one size fits all”. Having said that, obviously if they’re getting laid off, they may very well be in the segment that’s less desirable.
Very regional as well, Eastern europe is supposedly doing well, western europe (UK/NL) is doing alright, north america seems significantly worse
Yes Poland in particular is booming. It’s an outsource destination that’s higher skill and less risk than India.
I've got a couple of friends that left London to go back to Poland during covid. They first continued to work remotely, but ended up switching to Polish companies because the pay was better.
Yes I think salaries are still a bit lower, but the gap has closed a lot. And cost of living is lower in Poland plus there is some tax break for self employed contractors that means you only pay ~20% tax compared to ~40% in the UK.
With those two factors you could easily end up better off overall, especially if you have kids
The kids factor is even bigger if you move back close to relatives. The ability to drop your children at grandma's instead of paying for childcare is an easy 1k a month you're saving.
I wtedy przynajmniej babcia będzie szczęśliwa pilnować dzieci.
Daycare is completely free in Poland since 2024 (you need to submit an application to ZUS, but there are no limits, it's always accepted), even the private ones. You only pay separately for food (10 zł per day the child is actually attending to the daycare).
I switched from a Polish company to a German one (both remote), but my pay is more or less the same. The difference is that in Poland to get that money I have to be a "top performer" with a lot of stress and not a lot of time, while in Germany I can be just a mid dev.
> 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.
Use a good recruiter to do the dirty work for you, it’s not cheap but it’s worth the lack of hassle.
With that said, at my firm we switched to using an in-house non-technical HR recruiter using nothing but a LinkedIn Job listing and the results are exactly as you’re experiencing. Perhaps 1 in 100 is a real human with a real resume, the rest are AI being fed our job description to generate a resume.
Onsite final interviews and technical assessments are our stop-gap.
How can humans stand out to companies like yours?
I’ve considered writing informally and putting subtle typos in my cover letters, for example, to signal humanity. Is this a good idea or do recruiters look down on it?
You can't, this is the issue with an extremely unregulated industry. You want to stand out as a single individual among 10,000 similar qualified people on paper? Good luck.
This is likely an unintentional, but beneficial, side effect in thwarting labors power.
Since workers have a hard time getting interviews due to AI slop, that means they'll have a harder time developing leverage rather than being forced into accepting any job because the alternative is to become homeless and die.
The people I hired in my last round, with over 600 slop and fake applicants, had honest and informal cover letters that stood out. I’m sure I passed up on real decent people as a result, but there’s no perfect way to avoid this right now.
It helps that we have something closer to a lifestyle business, where I can ask for a brief paragraph about your relationship to the outdoors and cycling, but that just means I had 500 slop cover letters gushing about cycling. The three that made it through were short concise honest and linked to real world activities they did.
Good luck, it’s a hard problem , and very very adversarial. You have true scam level applications from North Korea and India, and you have unqualified people trying to appear qualified. Sprinkled in are unqualified people who would be a good hire because of raw capability, and qualified people who are looking to do bare minimum.
I'm glad I read this. Pre AI, I've always wanted to tell the company about myself using my own language instead of this fake corporate LinkedIn style language, which seemed like was the norm, and was expected. Now it seems like employers are looking for some hint of humanity. I guess I'll remember this if I ever decide to apply for a job again.
It’s hard to say because I’m not the recruiter nor am I or HR staffer.
Historically, typos on a resume are immediately filtered out. Lack of duty to care or some such.
We have some type of tooling to filter out obvious AI slop writing. We also check your submitted social media, not for offending content, but to make sure it’s been around for some number of years, especially pre-AI.
We’ve had folks spam both our hiring manager and Senior+ level staff begging for a leg up. We turned them down.
To honest answer is the hiring market sucks for all involved and there is no good answer here other than be honest and organic and pray. I wish I had a better answer, but it’s a hirers market. We can afford to be picky and lose a good candidate.
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
I dealt with this exact problem in my last hiring phase too and used this technique to screen them out earlier: https://thomshutt.com/2026/03/24/interviewing-in-the-age-of-...
You should spend a few days thinking about how to improve your process, with more than just a final interview.
For better or worse, it isn't a company's job to pay laid off employees until they find a new role.
The industry standard for severance is 1-2 weeks pay per year at the company, paying out roughly 7 months is a big deal (and yes, an acknowledgment of how rough they know the job hunt will be).
Not in tech. Larger severance packages are common.
Going forward, I wonder if severance packages should be a point of competitive recruiting advantage
They are for CEOs and have been for decades. We call them "golden parachutes", and a lot of people hate them.
I assumed we weren't talking about CEOs though. Can't say I've ever heard of a CEO being impacted by layoffs.
Are smaller tech companies also commonly doing larger severances? I've only been laid off once and its when the company was basically out of money, but my understanding was always that it was only FAANG and similar that considered larger severance packages.
Maybe it should be the companies job, being jobless in the US is a potential death sentence and since we don't have universal healthcare, universal childcare, or universal higher education/vocational training the onus should be forced on the companies to provide welfare for workers since they are so adamant about not paying taxes to create a welfare system that doesn't mean homelessness or death.
There is also no industry standard for severance, it's not federally mandated and not a guaranteed benefit.
I'd be very hesitant to throw out so many of the fundamentals that made America into what it has been for the last couple centuries.
The goal, at least here, is to expect individuals to mostly take care of themselves rather than depending in the state or some other authority to do it for them.
Universal healthcare, guaranteed indefinite severance, universal childcare, etc are completely antithetical to our system. Maybe the majority is ready and willing to throw that old system out, but if so we need to do it by focusing on the fundamentals rather than getting distracted with higher level implementation details.
> Universal healthcare, guaranteed indefinite severance, universal childcare, etc are completely antithetical to our system.
I don't see how that follows. How is your system that different from e.g. the UK, which manages to have all of those things (severance is not indefinite and is unemployment).
Unless I'm drastically misinformed, the UK is dealing with a mountain of issues including immigration, economic problems, and quality of the healthcare being provided.
First of all, are those problems you would say do not exist in the US?
And if that's the case, I'd disagree. But would any of those problems be somehow explained by the differences between the British and American systems? Especially when countries with very different systems (like all of continental Western Europe), and the US, have then too.
Many (all?) of those problems do exist in the US as well. My point, though, was that the US was historically based on ideas that don't align with welfare programs. I only raise the issues in the UK because you were comparing the two and it seemed important to note that though the UK has many welfare programs, it isn't going well for them currently.
Toy original point, the US was based on individual freedoms and rights that simply didn't exist in the monarchical UK system. For much of the US's history the, albeit politically idealized, expectation was that you come here and make your own way. We didn't have a feudal system and didn't depend on a monarch to run many details of our daily life. We have seen more and more of that creep into the American system over the last century or so though, and yes we are coincidentally also running into many of the same issues seen in more socialist European countries today.
> We didn't have a feudal system and didn't depend on a monarch to run many details of our daily life.
Neither were the British by the time the American revolution started.
I don't see much difference in the personal opportunities and rights between post-independence US and industrial Britain. Apart from, you know, the US having slaves with no rights nor opportunities.
you mean that system that has created the most wealth inequality in many decades if not ever?
Yet people risk their lives to go in illegally. Something doesn't track.
Its because, inequality is not the problem.
The problem is the ability to move between income levels. That coefficient used to the highest in the US. Rich people could and did go poor. Poor people could be rich.
That index was always the highest by far in the US, but now its decreasing. That's the real issue.
Empires often create increasing wealth inequality as they begin to fail, that's not unique to the US.
I don't think it should be the companies job, but I would be ok with it being paid for by taxes companies pay.
Requiring companies to do all of these extra things just gives larger companies more and more advantages, since they have an economy of scale to provide go government-type services.
I don't want my company to be in charge of my whole life. Let them pay taxes to a government that can provide those things equally for everyone.
What's the difference in it being a responsibility of the company and it being a program paid for by races paid by companies?
I mean this as a genuine question, in case that isn't clear. To me the latter is just socializing the cost across multiple companies, but I'm happy to be wrong here.
Unemployment taxes/benefits are largely like that. And they are experience rated, so high risk pay more.
Depends on what you specialise in. Sysadmins seem to be in demand (which isn't a programming job but is in tech still) and embedded hasn't been killed by AI yet (and I doubt it will)
> however, it will take every bit of that time for some to find new placement.
Isn't this another way of saying the severance package is generous enough to cover the time needed to find another job even in a down market?
If a severance package that covers the time needed to find a job isn't enough then it's starting to feel like we're being angry just to be angry. I don't like layoffs either (I've been laid off before) but if a company is giving 7 months of severance on what was already a very high paying job, that's very good.
Damn. I got two weeks notice and then got shown the door with nothing. And now I get to compete with all these people who are going to be so much less stressed
> compete with all these people who are going to be so much less stressed
Well many of these folks then would prefer to decompress and chill for a few months instead of hitting the recruitment process early.
Proper layoffs require at least 60 days of notice or 60 days of pay. Maybe you weren't part of a proper layoff, but if you think you were, check out the WARN act.
Here you go:
The WARN Act is triggered if there is a mass layoff of at least 50 employees (excluding PT) and that number represents at least 33% of the active employees at a single employment site
OR, if RIFF means closes location (with 50+ employees affected).
In the US??
huh? That sounds like California?
Have there been any better tech layoff packages in the last few years?
This is probably the best, wow.
The question is are they being good to their employees or do they severe headwinds in the job market going forward
"We are our own most demanding customer. Cloudflare’s usage of AI has increased by more than 600% in the last three months alone. Employees across the company from engineering to HR to finance to marketing run thousands of AI agent sessions each day to get their work done. That means we have to be intentional in how we architect our company for the agentic AI era in order to supercharge the value we deliver to our customers and to honor our mission to help build a better Internet for everyone, everywhere."
As an English enthusiast, I'm getting very frustrated at how the language is consistently abused in executive communications to write words without saying anything.
The implication that is NOT said is that suddenly 20% of people were sitting around without any work to do because AI was making everyone so efficient and productive. This does not, however, seem to be the reality, based on conversations within the company. It appears we have yet another case of economic downturn disguised as increasing velocity.
Which part of that sentence was confusing? I found it perfectly clear. Their internal AI use is exploding, which is a signal that they need to structure for that, and so they’re laying people off as one of the first steps towards actioning that signal.
Nowhere did they indicate there is less work to do, in fact quite the opposite.
> Their internal AI use is exploding, which is a signal that they need to structure for that, and so they’re laying people off as one of the first steps towards actioning that signal.
I don't see anywhere where the jump from "structuring for AI" directly leads to "laying people off", unless "structuring for AI" means there is less work for people to do, do you?
I think it means - we're spending more money on AI thus we don't have as much to spend on people
This will surely end well
They have been hiring like crazy year after year. Undoing 1 year of hiring is not the end of the world.
I'm sure it probably feels like the end of the world for some people.
Of course. Being laid off sucks, but that’s not relevant to this thread.
Noone knows what the correct structure for this new world looks like. We’ll see what they end up hiring for. But it’s fairly standard to lay off a bunch of people and hire new, rather than retrain, when you need to restructure
Isn’t it funny how the measure is how much AI is used instead of how productivity has evolved?
Not really. This is all so new, noone is using it correctly, because noone knows how to yet. We’re all just kind of flailing our arms around with it, but it’s clearly a force multiplier and its increased use is an actionable signal
The sentence is not confusing, the sentence doesn't mean anything. There's nothing confusing about it, but there's no information either. "We're making great strides in AI" and "We need to cut 20% of people" are simply two statements without any connection aside from the fact that they are next to each other in the sentence.
Or maybe you don’t understand what it means because you’re not the target audience?
Enlighten me then as to the secret meaning behind the words used to communicate in the language we call English. Saying that AI is really transforming the company is fine. Saying that 20% of staff need to be laid off is fine. Those are understood terms. How do they relate? There's no explanation. Did cost need to be reduced? Did those people no longer add value? Was there certain projects that weren't profitable? Nothing is explained because meaning is avoided.
> "We're making great strides in AI" and "We need to cut 20% of people" are simply two statements without any connection aside from the fact that they are next to each other in the sentence.
Huh? How is it not connected? More productivity means fewer people are required. I'm not sure how you are not able to connect these obviously connected statements.
> More productivity means fewer people are required.
Required for what? If your goal is growth, and AI really is improving productivity of every employees that uses it, then why would you fire anyone?
There’s an optimal number of employees required at any productivity point. Why don’t Google hire 3 times the number of developers? They have the money right? What’s your logic for not hiring more?
Because firing is not a zero-sum for hiring.
Hiring 1 developer instead of 3 is not the same cost as firing 2 developers.
why is it not? if google can make more money by hiring 3x the developers, why didn't they do it? just explain that
Hiring and firing people aren't symmetric actions.
They're asymmetric because hiring more people costs more than just the salary. For example, some folks' entire jobs are to recruit and hire people. Once they are hired, you have to onboard them, etc. So the more you hire, the more you have to pay the folks with supporting roles (either directly or by way of them not having infinite time/capacity).
Firing people isn't free, either. It comes at the cost of bad PR and severance, but the latter is voluntary and calculated by the company, and the former is quickly forgotten by anybody that matters to a publicly traded company (investors).
That means not hiring those two people in the first place is usually cheaper than firing them later.
To the original point: Cloudflare isn't hiring fewer people; they are firing people. If they are trying to grow (like every single investor is counting on them to do), then why would they fire people (the cheaper action) now when they would likely need to hire people (the more-expensive action) later in order to meet that increased growth?
The charitable answer would be that the people they are firing were deemed unable to adapt to using AI for all of this supposed increased productivity. But Cloudflare aren't saying that. In fact, they're saying the opposite by stating it's not about individual performance.
your's is a caveat against my larger more correct point: there's an optimal number of employees needed at any given productivity point.
its true that hiring and firing are asymmetrical, and CF has shown that they are willing to bear the brunt of the asymmetry and fire people despite the downsides.
that asymmetry lies doesn't disprove the original point: cloudflare simply doesn't require the _same_ number of people to work for them with AI.
if you disagree with this then you believe that companies should only have monotonically increasing number of employees which is quite ridiculous a claim
Of course it's a lie. Cloudflare is saying, essentially: "AI is making us so profitable that we've decided to reduce our profit by 20%, to keep it reasonable."
They’ve been pumping out products like crazy
They don’t need them. Simple as that
someone has to maintain a he products
More AI?
Good luck with that.
I'm sure that more AI will solve that problem too.
by laying people off they increase their profit, at least in the short term (which is all that shareholders care about)
Not with the severance package they're offering, which is why their stock was down between 15-18% after announcing this
Look at the chart of their stock price over the past couple of months. There was a huge run that started literally just over a week ago. Even after this 20% drop, the price today is only slightly below where it was before that run.
Their stock price has been pretty volatile for a while now (6+ months), so even with a swing of this magnitude I don't think it's valid to see it as much more than a correction.
But they’re not profitable? They make 450k per employee revenue, but lose 17k profit. Meanwhile they spend 470 million in stock based compensation for example, up 100 mil from year before, on 5k employees, which they’ve been increasing a lot every year.
I am confused by this post. No trolling: You wrote "reduce". Did you mean to say/write "increase"? If you layoff people to reduce costs, then your profitability should increase.
That’s a very MBA way of thinking.
If we extend the logic, if we have 0 employees then profitability is maximized right? Then shouldn’t every company have 0 employees?
Obviously hiring increases profitability, otherwise some of the biggest headcount companies wouldn’t have hired so many people
Firing people because they became more productive with AI does not really make sense. If productivity went up, the company should be able to ship more, support more customers, or grow faster with the same team. This sounds less like an AI efficiency story and more like a funding or cost-control story dressed up to keep investors calm
Here, I translated it for you (https://translate.kagi.com/?from=linkedin&to=en_us)
"We’re basically using our own staff as guinea pigs. Our AI usage has spiked 600% lately, mostly because everyone from HR to marketing is leaning on bots to do their actual jobs. We’re forced to restructure the whole company around these agents just to keep up with the hype, hoping it actually helps us ship something useful and justifies the "better internet" PR we keep pushing."
I will reply here assuming that you posted with good intent. I think that their PR statement is reasonable from an investor perspective. Try to detach yourself from the personal effects of layoffs. In short, they are saying: Thanks to AI, we don't need as many people to run our business. It is pretty clear to me. Sure, you can be angry about the layoffs, but the economics are clear: AI is increasing profitability faster than the business is growing, so they are using layoffs to reduce costs. Imagine that you have an HR team of five people. If AI has dramatically improved worker efficiency, can you have an equally effective HR team with only four people? That is basically what happened here.
As an investor, it sounds fucking stupid. They aren't dogfooding, they're eating all the dogs' food.
They fired some talented folks. Folks who could be retrained. Folks whose experience snd expertise is valuable. Don't kid yourself.
this is a low quality comment that doesn't address the simple explanation: more productivity means fewer people are required.
Disagreement != low quality, and that explanation is incredibly naive and simplistic
I would say the GP's phrase: "more productivity means fewer people are required" is perfect summary of my opinion (and post). Sure, you can flesh if out, but that is crux of my argument.
I see this sentiment a lot on HN. To be clear, I am responding from the perspective of US labor law and general business practices. Employment is not a sacred right in the US. The US system is (larely) hire and fire easily. As a result, the US economy is mildly unstable for the middle class normies (much, much less stable that most other highly developed nations with strong labor laws -- most of G7/G20), but overall wildly dynamic for a large economy.
"They fired some talented folks."
Sure. That is guaranteed with large layoffs. I work in an insanely competitive industry, and there are annual culls each autumn of the bottom 5%. Few are surprised by who gets cut. What is harder to forsee is a business downturn and they need to layoff X% of staff. You see good people let go. That's just life in that kind of system.
"Folks who could be retrained."
Again, in the US, for white-collar office workers, this almost never happens, and surely not for very highly skilled software developers (probably most of the layoffs at Cloudflare). It is not required by law, and it is not a common business practice in the US.
I don't care if it is or is not a common business practice. It is much cheaper than the severance package.
I think GPs point is that this is how they're trying to spin it, but they're not explicitly saying it, and there are doubts whether it's actually true. For outside observers it's difficult to simply ignore all the embarrassing outages that cf has experienced recently and just accept that the company has suddenly solved all their issues by using AI and firing people.
I don't know what to think when I see comments like this. Everyone makes mistakes. And no one provides flawless service. If their recent issues are so damaging in your opinion, why is their business continuing to expand at more than 20% per year?
I don't think the mistakes in themselves are damaging. What seems damaging to me is that cf has, on multiple occasions, repeated the same or similar mistakes right after they made major mistakes. This makes it seem like they're not learning from mistakes. Regarding the success of their business model, I can't make a meaningful statement about it, but is that really a convincing argument? If a business is successful, does that automatically mean their product is good?
Thanks to AI, security is more important than ever.
If A1 was real, cloudflare would be 1000% more needed and they would be falling behind with their 600% productivity gainz
> AI is increasing profitability faster than the business is growing
I don't understand how this could be the case for Cloudflare specifically. They made their name with DDoS protection and sandboxed hosting. These are exactly the products whose demand rises in lockstep with agent adoption. How could they possibly be allowing all the growth opportunity to slip past them? In times like this, with rising productivity to boot, you increase headcount, not decrease.
Could be they are actually not doing so well and try to cover it up with the usual AI is god excuses, to fool investors.
I hope this bubble bursts soon. HR people avoiding to do their actual job seems like it is the modus operandi in the majority of businesses these days.
That’s what they claim, though.
On its own its just words which might or might not reflect reality. The phrasing strongly indicates its the latter, however
it's all marketing wank, but how can they "supercharge the value delivered to customers" through company restructuring? whether they hire 50k more people or fire everyone, the value delivered to the customer depends on the quality of the product and the price - irrelevant of cloudflare's margins.
The price obviously depends on how much salary they have to pay.
No it does not. It depends on what the market is willing to pay.
It’s actually both.
Products will low/negative margins just won't happen or will get killed. But if the margin increases, they might live.
Also with higher margins, more money can be invested in research/experimental products
> 20% of people were sitting around without any work to do
Obviously not directly, because work stretches itself to the time available.
You also have to consider nowadays whether a human even wrote most of it, or if is just a tale told by an idiot, full of sound and fury, signifying nothing.
But yes I agree the trigger for layoffs is never massive productivity, the reasons give here are completely bogus and if management actually believe any of it the company deserves to die.
Aka bullshit
I don't read this as employing 20% was twiddling their thumbs and sitting around.
If it means anything beyond economic issues, I read the implication as their LLM expenses have gone threw the roof and with the choice of cutting LLM use or cutting headcount, well we see what mattered more to them.
Unfortunately I think we’ll see more and more of this as companies continue to encourage their employees to use LLMs everywhere and for everything. Eventually they will have to come to terms with the cost of such mandates, and it’s either ask your employees to “use AI less,” or it’s let some percentage go and continue to let the rest burn tokens.
I am perplexed at how it can cost so much. I have been using AI every day, all day for a few months now and I have not even gotten to spending $300 a month. I use Cursor for teams, so we get ~$80 of usage for our ~$40 per member, then we pay Cursor's upcharged API rates from there, and I STILL don't spend more than $300 a month, if that. What the hell is everyone doing with their fucking tokens?
You set cursor to use Opus 4.7 and ask it to review your branch commits and then it looks at stuff for a bit and that's $10.
Those 20% were unproductive in the literal sense or the economic sense.
No, it is more accurate to say that leadership at Cloudflare does not know what they are doing nor have they known what to do for a good decade now.
Acting like workers at Cloudflare have any meaningful say in how work is made or the direction of the company is delusional neoliberal fantasy thinking.
The onus of poor business outcomes is laid directly on its leadership. Saying that workers were unproductive when they were coerced to follow leadership's mandates is just straight up class warfare.
Dang it Bobby indeed.
> No, it is more accurate to say that leadership at Cloudflare does not know what they are doing nor have they known what to do for a good decade now.
I think we're starting to see that across the entire industry. Leadership is easy when times are good. The job has gotten very hard.
So you would contend it's in the economic sense. It wasn't intended as an assignment of blame, I was just saying Cloudflare either thinks they weren't doing the job or job they were doing wasn't making money.
llms don't need healthcare or stock grants
And if Jevans paradox wins out, all that money will just go towards tokens.
I believe they meant that the cost of using an LLM is extremely high! There are reports of people spending USD $500~1000 a day! There's the possibility of decoupling of effort and output! Which causes an illusion of work.
What kind of problems do people solve that require this amount of money per month, let alone per day?
Is anyone reviewing the output of the generated work (PRs, docs etc)?
corporate lawyers tend to do the same shit. s
say a lot - while saying nothing.
Typical fire until something breaks and usually that something is inertia/timelines. Stagnation really
This really sucks. I loved this job. I'm an EM and I was trying to hire more people because we're so busy with everything we needed to do. My teams products are something like 95% profit.
Really going to miss my team, they were wonderful to work with. Secretly hoping they'll have to rehire.
I refuse to believe it was about AI. Coming from the inside, the bottleneck was never code. Seeing who is being laid off, especially on my team, it's the people who make things run.
In my experience, companies never value transparency. And it's doubly true for companies that boast about transparency. Obviously, it's within their authority to cut head count, but they've also obviously made some kind of major strategic shift either to cut costs or abandon some lines of business and they are not being upfront about it at all. The stock is up 111% over 12 months. They don't seem to be in any danger of crashing or collapsing.
> Seeing who is being laid off, especially on my team, it's the people who make things run.
As a Cloudflare customer, that's reassuring! .. not.
I know of 4 teams in Cloudflare One, who lost EMs, PMs and engineers in really critical connectivity systems. Our list of things we need to do is years long. Many of those are needed for reliability and scaling.
They quietly stopped hiring months ago and I figured things were not good. My mistake was thinking my group would be a little safer being profit drivers and big deals...
Is it possible that the line of thinking really is that "agentic AI" will up for the capability shortfall?
It seems to be the stated expectation, but I find it incredulous that management really would believe that?
Do you really think management would come out and say "Hey we actually fucked up and don't really know what to do. Please don't punish us, here is a ritual sacrifice instead."?
Of course they're going to downplay their own stupidity and use LLMs as a means to suppress terrible news.
So Sorry, And I literally just moved all my stuff to cloudflare 2 weeks ago… if it means anything it was a great product.
" Secretly hoping they'll have to rehire."
They will just expect a lower wage rate. There's some tacit collusion going on here.. they are using LLMs as a vehicle to address the price that comes with the true shortage of software engineers. You seriously dont think they talk about this behind closed doors? of course they do.
Absolutely. My hope is selfish - the market is awful
Do the world a favor and take your institutional knowledge out the door to enjoy greener pastures.
The pasture is pretty crowded and full of shit. But thanks, friend. I appreciate it
I've been laid off from every job I've held (and once I was even re-hired a month later!) so I know the feeling. There seem to be others here who are also impacted and I fear the overall trend will only continue, so I wrote up my thoughts on how to future-proof your job search. I do think the GP comment about institutional knowledge could be a key part of it. Hope this helps: https://news.ycombinator.com/item?id=48067459
I promise you there are a ton of companies desperate to hire talent right now. It's hard on both sides of the market. Lots of noise, but there is demand for this supply. Unfortunately, that means personal connections are more valuable than they used to be, just to get the ball rolling.
Are you sure? Can you share some of those companies that are desperate to hire talent right now? I'd like serious teams as I need to find work. I do keep an eye on HN, Wellfound, Workatstartup, X, etc.
There are always a ton of companies looking for good talent. However there are not nearly as many as a couple year ago: there is more good talent looking for a job than there are jobs. This has happened before, it will happen again (this is easy for me to say - I still have a job, but I've been there before and I know first hand how bad it is when you need the job).
Good luck to those of you looking for a job. My company is hiring a few people, but if someone leaves today there is only a 20% change we hire someone outside to replace them so I can't really offer leads worth looking at.
My company is hiring (small, but definitely happy to talk to you and all the people who made stuff run on your team at Cloudflare!) https://jobs.ashbyhq.com/blaxel
I know Waymo is trying to hire like a thousand engineers this year.
There are others.
My man, all these fuckers use the same parasitic management consultancies. That's why all this shit looks the same.
Time to watch Office Space again?
"I'm an agent person. I'm good at dealing with the agents! Can't you understand that?! What the hell is wrong with you people?! I'm good at dealing with the agents!"
That line is so damn good i recommend everyone who doesn't get it to watch Office Space.
Cloudflare has never made a profit.
Is your stance that shareholders should perpetually subsidize it out of the goodness of their hearts?
My stance is this: Fine, maybe you need to restructure for profit reasons. If that is the case, then it is also beholden upon the people doing the layoffs to understand their responsibility in that.
In an ideal world, a layoff of this scale would also require a shakeup of the management that let it get this bad in the first place.
What's more, the higher up the chain, the less onerous the layoff for the individual getting laid off.
Why should people who are profitable to employ be laid off as well?
It just sounds like you're upset and want to hurt whoever you feel is responsible for making you upset. That's not a productive stance to have on important topics.
What an odd view of what I said.
I'm not asking for the people who hurt me to be hurt. I am asking that the responsibility of the actions that management layers took be considered in layoffs.
For instance - If overhiring happened, how is this not at least a little bit on the individual that approved of a hiring spree? Why is it that they should be able to yield a baton that hurts the workers they hired, without having to actual bare the brunt of the decisions?
If a business is still unprofitable, a business that touches so much of the internet like Cloudflare, then that is also a strategic failure and should be punished as such.
I feel like your tone in this response was also so condescending.
This is how the elites actually feel tho. They think they can do no wrong, it's not their fault that they don't know how to run a business but you should please give them another chance and not change corporate law to stop benefiting them over workers.
It's a mindset that enables neoliberalism to flourish while vast majorities suffer immensely to benefit the few.
It's a system that's worth questioning as the material lives of 100s of millions of Americans are getting objectively worse every year while we are always being told there is no money for healthcare or childcare but there is always trillions laying around for imperialistic activities like data center expansions and war.
Let's throw the elites in jail, so that more elites can come in and do the same thing?
There's a limited pool of execs to run companies. Its a pretty homogenous group of people, similar skill sets, some have varying philosophies on how to run companies, but the majority of them will likely make the same decision if given identical sets of circumstances.
I get triggered when people start calling out "elites" and other boogeymen - what does it mean to have companies run by non-elites? What even is an "elite"? Are they elite simply because they are employed as an exec? Is it possible to have a non-elite executive?
Using "elites" in this context makes it feel like an emotional complaint about the world rather than anything rooted in logic.
None of these elites are operators -- they're liberal arts educated and their primary skills are in using words and lack of to achieve status gains -- nothing more.
In many traditional industries, companies are built and run by the most senior members of whichever discipline. Tech is different because most of its skilled members intentionally cede soft power because of personal (imo short-sighted) predilections and the exorbitant amount of money flowing in has caused a mad dash from other disciplines.
The "elites" are people trained either institutionally or personally (from their relationships with others) to understand power dynamics and utilize them for personal gain.
Navel gazing is a great away to achieve nothing. Being lorded over by someone who couldn't even figure out how to build and host a simple webapp is ludicrous. Should the CEO of my hospital not understand that the mitochondria is the powerhouse of the cell? Should the partners at big M&A law firms have no idea how to read a contract? No, because that's fucking ludicrous -- yet it persists in tech because its technicians have zero training, education, or even sense for elite ways of thinking.
No, it's more like we have undemocratically elected people in positions of power that want to act like dictatorships when in reality these people made a mistake that is costing the company billions of dollars and their ineptitude means they should be removed from these positions.
I thought Silicon Valley was all about meritocracy? Why should corporate shills that does not know how to profit from entity that controls 25% of internet traffic be allowed to keep their jobs but the actual people providing real value, the workers, aren't?
That is a system that doesn't benefit humanity. It selfishly benefits the few.
Cloudflare has never made a profit? The thread commentator said the product he maintained was 95% profit.
"Management consultancies" that make sense. I thought that maybe all these higher-up people know each other and share a common "Slack group"
> Seeing who is being laid off, especially on my team, it's the people who make things run.
How did the company decide who to lay off? They didn't even ask EMs?
My boss had no idea layoffs were even coming, so who knows how they picked.
I really don't know. My org now has 40+ engineers with 2 managers. Down from 6. I really don't know how they will do it. Each one of us were handling critical shit, and desperately needed more engineers. PMs made things run and they got hit even harder
No one had any idea. My director got the same email
Almost 99% sure that They hired a consultant firm (MBB) that told them who to cut; this is pretty standard practice now at public tech corps. Especially if EMs weren’t in the loop. This looks like purely a margin improvement exercise thats hiding weaknesses in the company’s financial performance.
I’m sure they don’t know what they are doing or necessarily care, but I’m still curious what the consultants even claim to be looking at to make the list? Job description, git activity, team level profitability, salary, etc?
They probably claim all of it, but likely only job description.
"You have 20 guys that can code, so you can get rid of two of them".
Employees are treated as a cost which is why you often see the strongest performers inexplicably laid off (since they are likely compensated higher). In situations like this they don’t care about productivity; leadership is given a list and they can move a few people around but for most its game over once they’re on it.
EMs are never in the loop for layoffs for companies of this size, because the whole company would just get forewarning of the layoffs
Thats usually correct for these “surprise” layoffs. For the ones that are announced in advance there is a bit more coordination (like the meta/amazn ones).
At Amazon managers absolutely are not in the loop for layoffs. I would very much doubt they are at meta.
Wow! Is there any good read on that, like even if a "YouTube" show or something? This is quite interesting.
If you know anyone that works at MBB they would be happy to share this with you; if you’re in SF just hit any bar for a weeknight happy hour and you will 100% find someone.
Yeah, honestly this is where LLMs shine since they were trained on so many MBA/HBS materials. Just remember to ask your questions in a way that praises neoliberalism and you'll unlock even more secrets about how they fuck over and alienate workers.
This style of layoff seems far more common post-2020 than targeted "restructuring". I've lived through a few layoffs now, survived most of them, but each time and at each company I've gotten by on an apparent roll of the dice and nothing more. Every time I've seen some truly important ICs get let go, their EMs having no input.
Companies have so much data on employees/products/customers etc these days the EM's opinion is just noise.
> I was trying to hire more people because we're so busy with everything we needed to do
That’s how it was at my previous company also. If you asked any engineer there they’d say “I’m incredibly busy, and I need more headcount to get through the things on my plate”. Then they laid off 40% of the company because AI had made everything so efficient shrug
I guess a company can coast on reputation for a while, before things come crashing down at least at parts of the company.
Please point people you know to https://antithesis.com/company/careers/ which is hiring EMs and deep tech people
Welp, looks like I’m affected. If anyone is looking to hire a systems engineer with distributed systems and load balancing experience, shoot me an email at <anything>@piperswe.me :/
I’ll update this with a resume link tonight…
That sucks, and the market is too bleak for empty platitudes.
This just sucks, period.
Take care of yourself until you land something. I'll keep this in mind if anything comes through my grapevine.
Good luck, I'm sure you will find a great role!
good luck and take care of yourself!
CV link: https://piperswe.me/cv.pdf
Firstly, kind sir, layoffs are hard for each and everyone of us and I wish you best as you navigate it. I know you will get many wishes and good lucks though but consider my wishes to be one of many to help ya out.
The who wants to be hired page is still open within Hackernews: https://news.ycombinator.com/item?id=47975570
I recommend if you can share your CV/send a message there, I will try to also keep an eye on it if you do share your CV/resume there and I would love to upvote your comment there to shower some more exposure/love from the community as you are member of hackernews. You are also part of the hackernews community and its the least that I/we can do.
:hug:
pretty minor since the rest are fine but your linkedin link is broken
oh indeed it is! thanks for the heads up!
Goodluck mate
Good luck, and if we can help at all, let us know.
Edit: this is a silly longshot, but please see https://news.ycombinator.com/item?id=48057989.
I'm honored you're responding! I've received a few leads from this comment that I'm chatting with, and it's been a major morale boost for me.
At this point in my life and the economy I'm not particularly looking for such early-stage startups like Magnetic (especially w/ relocation to SF), but thanks for giving me the heads up!
Dude, you have the most amazing name ever. Hope you know that.
Thank you, I picked it myself :)
You probably have other stuff on your mind right now, thus I can understand if you are not in the mood for answering, but I‘m too curious to not ask:
According to the Reuters article, AI use has increased 6x over only three months. How did that feel from the inside? I’m especially curious because Cloudflare is not a toy company, and this is not about some influencer trying to sell me their latest „this changes everything“ bullshit.
So, shifting a company significantly towards agentic AI, and I assume this isn’t simply about „install Claude Code on every desk“: would you say it actually works? Or would you say it’s still more of a bet, and still needs to prove itself as a sustainable long-term strategy?
Interested as well!
I work at a similar scale company. Like an average person's experience, some things are amazing and super productive with AI and some things aren't. And it's not always the same things all the time.
Sometimes we are able to do a ground up rewrite of a service and squeeze huge efficiency gains out of it all bc AI is helpful in doing so and we have a very good test harness.
Sometimes it makes subtly wrong suggestions that people follow and cause outages.
Sometimes it leads to huge headaches for devs who have to review huge backlogs of code with no idea which parts are serious and which are low effort AI slop.
Sometimes it lets you do a 2 month project in 2 weeks.
https://x.com/mgill25/status/2052639259924844894?s=20
Dropped you a email, we have openings for SREs
I’m curious, what was your AI usage and output like?
I had OpenCode doing most of my substantial code changes for me, once I figured out what the code changes had to be. (so, it saved me typing but not thinking) I also vibe-coded (really slop-forked TBH, that's the Cloudflare way after all) an internal tool that our team used. I definitely was not a small user of our AI tools, though I know that there are others with significantly more.
Were there smaller users of AI who still remain after this workforce reduction?
I don't have a particularly good idea of how much others were using it, unfortunately.
Are they claiming to use AI to replace systems people too? As in infrastructure folks?
I'm going to start calling these "Canary" moments.
Assuming we take everything at face value for these sorts of cuts, it creates the following scenario:
A company finds itself with surplus labor capacity due to the efficiencies in AI while also posting substantial profit or revenue growth. The company could downsize the workforce to capitalize on short-term efficiencies and increase margins, though this will come at the cost of long-term reputational harm due to posted profits/health as well as burning out staff who must do the same (or increasingly, more) work with less headcount, leading to attrition when the market shifts in their favor. Alternatively, it could leverage this surplus labor for a period of moonshot R&D or paying down technical/process debts while they have the capacity and the profit to pay for it, which harms short-term share price relative to their competitors slashing jobs, while improving the company's capabilities in the marketplace in the long-run, potentially through mastery of these AI tools or the creation of new product lines.
The fact so many orgs opt for immediate greed over long-term growth really is its own canary that leadership and governance both has failed the marshmallow test.
I think as someone pointed out earlier, this is more likely about margin preservation as their gross margins are deteriorating really quickly.
Yeah, I wrote this before I dove into their balance sheets for another comment. Cloudflare’s cuts are more defensible than most, but the timing and explanation are shady given that they’ve had the same problems for years.
Turns out running a profitable business is really hard when all you've known was ZIRP.
Honestly think the business lessons from big tech over the last 20 years are hogwash, mostly due to them abusing their monopolies allowing them to subsidize failing BUs indefinitely.
37signals has a better approach to starting software companies, and many of their peers/near peers indicate that it's a better way to sustain lifestyle companies too.
Doesn't turn you into a billionaire tho, maybe that's a plus.
That's the thing. There is no surplus labour capacity, neither they have any ideas for moonshot projects that could pay off left
cloudflare vibecoded a wordpress clone (emdash), they have no idea where to allocate engineers to make new products.
The work is mysterious and important.
If using AI had a "substantial profit or revenue growth" wouldn't it make more sense to hire more people so they can use more AI and increase revenue?
It depends if your market has room to grow. If it’s saturated it’s just about COGS.
If the market had been saturated then there wouldn't have been any (hypothetical) revenue growth which is what the comment above was arguing.
Personally I don't think there was any revenue growth to begin with. They are spending a lot on AI and haven't seen any ROI but for reasons they prefer to fire people and keep investing on AI.
If I can pay a person 100k and the result of hiring them is 1mil in my pocket, I am going to do that every day of the week.
The only reason to fire them would be that I think the money will still end up in my pocket without them.
"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.
Sounds like your company is burning 1000 dollars a month for something people are barely using. At some point those costs become unbearable and they admit that absurd AI budget was a mistake, or they admit no mistake and fire people. I know which they'll choose.
$1000 budget doesn't mean you spend $1000 if you use nothing.
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
On heavy coding days it can go up. But most people aren’t coding all day. And research and docs tend to be pretty gentle on the tokens IME. Only time I hit my limit was coding for 80 hours in a war-room. (Also I mostly use cursor which is more efficient with its implicit use of light models and indexed workspace).
You can't really compare them to Microsoft, Oracle, or Meta. Those companies aren't cutting costs because AI replaced their own employees. They're pouring money into AI infrastructure and models because they want to sell that capacity to others.
Their thinking is more: instead of funding another internal product team, they can redirect that payroll spend into more AI compute and models they hope to monetize.
I don't believe CloudFlare is doing that, though they might, they could be needing to spend in Edge AI compute and what not, building out that infra isn't free, so they might need to find places the cash will come from.
Hasn't Cloudflare been investing on AI infra for a couple of years now?
If you're not in leadership at Big Tech, you're only there for the stock price manipulations.
Excess labor would only translate to increased revenue and new products if these companies had a product vision to begin with. But they don't, so people get sacked.
You are on the right path, but I think you are off by a bit. Every company has more work they want to do than budget allows. However some of those things won't pay off fast enough. That is they have product vision but are smart enough to realize that those extra things they won't be able to do are not things customers are willing to pay extra for today.
This is simply a symptom that the company doesn't have good Quality Control processes in place.
AI-produced code is good but it's not so good that it can replace hand-crafted (or heavily supervised) code written by the type of engineer who works at Cloudflare.
What's really happening is that a few employees realized they can game the system by turning on a firehose of AI slop and pushing 10x the LOC than any other engineer (with or without AI), because there's no one to tell them to stop, and in fact with a management that actively encourages this.
> What's really happening is that a few employees realized they can game the system by turning on a firehose of AI slop and pushing 10x the LOC than any other engineer (with or without AI)
Did they figure out how to game the system? Or was the system set up exactly with incitaments to produce exactly this outcome?
The new system is immature and hence open to exploitation. This is eventually going to destroy some companies.
They figured out how. Mind you the system was setup with incentives to produce this outcome - but before AI it wasn't really realistic to produce all those lines of code even though you could and so nobody was gaming it so badly it broke. (it was always broke, but the breakage was acceptable before)
> A company finds itself with surplus labor capacity due to the efficiencies in AI
It's likely more:
A company finds itself with surplus labor capacity due to the over hiring during Covid, cutting down on risky ventures, protecting margins, and narrowing scope.
But I think there's also:
A company wants to see if AI is making them more efficient, decides to cut people as if it was and see what happens.
I also am not sure about the short term stock price, many recent mass layoffs the stock often moved down. The CloudFlare stock is tanking in after market for example.
There's STILL people propping the lie about over hiring? Just admit the economic system is not working for the workers already.
> The fact so many orgs opt for immediate greed over long-term growth really is its own canary that leadership and governance both has failed the marshmallow test.
Why do you think it's greed? The company's stock is down and they just missed expectations on their last earnings report (unheard of in big tech in the last 2 years).
It seems more like a traditional layoff scenario
This was kind of my read as well. We are increasing our AI usage but not in a way that meaningfully affects our ability to deliver on our product roadmap, so the solution is to cut opex on people so we can devote more to compute. The last bit is obviously speculation but it doesn’t feel like a far leap.
These all follow a same pattern now:
Vague overtones on AI savings without any hard evidence that’s happening, while ignoring obvious evidence that the company over-hired and is now underperforming relative to what would be needed to justify all that headcount.
Nobody believes these narratives at this point and CEOs would garner a lot more respect if they just simply said
“I screwed up, we hired too many people and fell short of performance targets. I own that. This resets us back on track.”
That would require the CEOs to admit they messed up.
There was an recent article on X with an interesting take - it could be that companies are doing layoffs not because AI is making them more productive but because it hasn't. Their costs have gone up paying for expensive AI but haven't seen any revenue benefits to offset it.
Article https://x.com/championswimmer/status/2051807284691612099
This is no that far fetched... I don't think it's that common that a customer sits on the fence and says "If only company X had Y on their feature list I'll be a paying customer". So the speed at which the company now runs through its roadmap does not equate to new customers joining.
I wouldn't argue that it doesn't give any benefits. However, it's not worth the current cost unless you already own RTX PRO 6000 to run any reasonable LLM. I'm using Claude Free and I'm happy with what I get, especially for the cost of $0.
I'm eagerly waiting for the prices to come down so I can upgrade my PC to AM5 and run Gemma 4.
Its quite possible that LLMs become housed units like the next PC. Initially it starts off as being a large thing in data centers (like computers did) until they got smaller and smaller. Except I expect the time it takes to get smaller and smaller to compress much more - given that we live in a world with far more resources and risk-taking.
Personally, I think AI is just a convenient scapegoat for these mass layoffs. Also, these kinds of announcements contribute to sustaining the AI hype which all tech investors benefit from. And investors looove hearing about mass layoffs, stock goes up every time without fail.
cloudflare stock went down, genius
investors are not some nefarious monolith cheering for companies to make decisions based on how it benefits The Vibes. they're analysts assessing business decisions.
Wtf are you talking about? Investors are just gamblers with a fancier title.
They absolutely invest based on vibes.
then why did the riveting stock analysis above mis-predict the market?
Because the market makes no sense. It's just vibes. Trying to make sense of it is a fool's errand.
It went down on poor earnings call. Layoffs were probably an attempt to soften the blow. Hard to tell what was the effect, because the two happened simultaneously
This is the simplest and almost certainly correct answer.
I’ve seen this at a number of public companies, and is a reason I hate working for them. These decisions are always unbelievably short sighted and ruin companies in the long term.
What was bad about the earnings? Every metric I am seeing is beating expectations. Genuinely curious
Most likely poor forward guidance.
This genuinely wouldn't surprise me, and I need to go back to looking at balance sheets to see if I can sus out the validity of that narrative. As AI subsidization ends prematurely and costs skyrocket, we should expect to see those costs reflected in the operation statements of major customers.
Since I had Coinbase up for review already, I decided to peek there first for any sort of correlation. In 2023, their "Technology and Development" line item shows $1.32bn going out, and by 2025 it'd ballooned to $1.67bn. This is despite headcount actually contracting by almost a thousand people between those two statements, which would normally mean a smaller technology spend since a lot of corporate software is seat-based nowadays. This suggests that yeah, actually AI spend is creating a heavier drag on the balance sheets and it's being offset with layoffs since the "job replacement" narrative is strong. That said, I'd need to check dozens' more balance sheets to draw any sort of industry-wide conclusion.
Ironically an analysis that Codex or Claude Code might be able to perform
And to factor in other infrastructure costs that's become more expensive too, such as hosting or hardware. So unless you can isolate AI spending from others that's not going to be convincing.
...hence why I qualified the statement like I did. I'm well aware one example from one company in a budgetary line item that's inclusive of labor and licensing and hardware and purchases and AI is not going to be remotely conclusive on its face.
Yet even taking into account all of that data, a $300m jump in three years must include some significant and growing amount of AI spend; everything else would've contracted (licensing, hardware) stagnated (cloud consumption), or been a singular event (CAPEX purchases) relative to the company's health and headcount.
This is pretty interesting. I'd read your blog if you write a thing about it.
I mean even this blog from Cloudflare reads a little like that.
Rings true because now teams end up building a lot of things that may or may not have alignment to customer/business needs.
The slow part has always been figuring out exactly what the customer/business actually needs, not the coding. Now teams are throwing money at tokens without solving the "who's buying this?" part appropriately and end up just building excess.
All judgement seems to have gone out the window.
At my last job, within our org, the director had 3 staff engineers building the same, but competing AI tool.
At the last all hands other teams announced their own similar AI engineer productivity tools.
I low-key regret now sticking around long enough to get a layoff package.
I suppose you meant 'not' not 'now' yeah?
yeah, my bad. I typo'd on purpose to prove I'm not AI :P :'(
This rings a bell.
Now that you can just throw tokens at it, it seems like actually thinking about what is useful and productive is no longer a practical skill (it still is, just no one in leadership nor product wants to practice discipline any more).
I don't know what to say about it except that it legitimately feels like some folks have just shut off their inquisitiveness and willingness to investigate and think before acting.
Now it's act, waste tokens and time, only to learn that the result of the action was obviously bad from the start because of some real-world human nature that we now no longer stop to try to understand first before applying a technical solution.
They're laying off the people who can't produce a minimum of 2x with AI, and keeping the maximalists with no life outside of work barely keeping up with the 100k LOC a week they're shipping to prod.
Suits have an idea of what the New Model Coder should be, and it's not people who don't burn through 100,000,000 tokens a week.
That makes no sense. If that were really true then they could’ve saved a bundle and did that same thing years ago before AI.
I mean, they do (and did). If you aren't shipping, you'll be out eventually.
The promise of AI gains with fewer people is what's triggering this - before, you needed ~1 coder to do ~1 unit of work. Suits now think you only need 1 coder to do X units of work because LLMs.
So no, they couldn't do the same thing years ago.
They aren’t, go find the comments of people who worked at the company.
This links closely with this article i came across: https://readuncut.com/the-social-contract-is-broken/ how basically corporations are pursuing greed at such high levels.
This is a great article, actually. It does gather many of the empirical data I have seen and felt but were unable to put into word.
this is such a cope take i don't even know what to say. how can people believe in obviously false things like this? like what's the mental model here?
They are laying people off because the cost of financing have gone up. The risk free rate is now almost 5%. For equity financing you'd need to show revenue growth models that allows repayment at that rate plus equity risk premium (which is quite large for new growth companies).
So the CFO makes a model that allows for this and for sufficient ROI they need less people to be more productive. This mechanically forces them to lay people off.
Of course laying people off might actually not improve productivity, but they need this to have chance.
Wishful thinking. It may ease minds for those negatively affected by AI.
I know it's probably automatic because of the similar titles, but hitting the bottom of the layoff announcement only to be recommended that article about hiring 1,111 interns in 2026 is a reaaal bad look
Kind of makes me wonder if the "more than 1,100 employees globally" actually means "1,111" employees. Talk about committing to the bit
All 4 bits
What is an intern in this context? When I hear "intern" I think of a summer internship. Are there other types for software developers?
Not meaningfully, but sometimes 6mo-1y as part of an undergraduate programme to gain industry experience. E.g. I had 6mo in my third year (not at Cloudflare).
> Cloudflare expects second-quarter revenue of $664 million to $665 million,
obviously $2.5e9ish/yr is substantial in absolute terms ... but that's it? They intermediate half the internet and only capture $7m/day?
I think about investing in Cloudflare but that P/E ratio scares me off every time.
Their revenue is growing 30% yoy, so investors are speculating it to pay off in the end.
The more they grow the harder it is to follow such rates.
They don't have a PE ratio. They have never made a profit.
NaN is scary
PE ratio too high!
Sir, that is price/revenue ratio
(jawdrop)
Don’t worry about P/E ratio. If you worry about P/E ratio all the time you would have missed every major tech opportunity for the past decade.
not true.
Businesses tend to choose them because they're cheaper than alternatives.
Oh less than Atlassian. Suprised.
Atlassian has a moat of features despite being expensive. You see nibbles by stuff like Monday.com but never big chunks.
CloudFlare is honestly still iterating to find a moat other than 'really cheap'.
High P/E means a good moat.
(Too high and everyone is looking for a start-up to eradicate your product segment of course).
high P/E means good income growth prospects. a good moat is one way to achieve that, but not the only way.
They are in a great position to generate a lot of value without rising prices, they haven't realized it yet because what they have to do is pretty boring.
Revenue is not profit. They "capture" much less than $7m/day.
I use Cloudflare for a lot of my side projects. It's a pleasure to use, and I manage to stay under the free tier. It does feel like they should be bigger in the cloud space, but I imagine the major players get a lot of revenue from VMs, which is a space Cloudflare has avoided.
My read of this:
Their AI costs have increased 600% but this hasn't translated into actual revenue. Also they are probably projecting AI costs to keep growing. They've done the math and at some point it is going to affect their bottom line.
Reducing or limiting AI usage would be inconceivable given Cloudflare itself has invested on AI and is selling AI services. Instead they've opted for reducing about 20% of their head count.
I don't think so. I think this is a common narrative in Hackernews when layoff news are shared. All the people I talk to in the industry positively confirm a boost in productivity. Its contribution to actual revenue could lag but it is present and confirmed by many.
It has boosted my productivity in my side projects but its nothing I can monetize. Maybe companies have the same problem.
Which public companies that do NOT sell AI have posted that AI has boosted their revenue?
I feel new startups, features and more services coming online would be a good measurement of this amazing productivity boost we're seeing.
Have you noticed a major improvement in every service you pay for ? Like many new features and incredible improvements in user experience and reliability? Because I’ve not really noticed that. Actually, things seem to be offline more than they used to, namely GitHub.
I am definitely more productive at generating lines of code though which definitely gives me the illusion things are mOvInG rEaLly FaSt.
Nah, even insane token costs don't come close to the costs of labor.
Most likely this is just 'AI-washing' - dressing a layoff for economic reasons (such as propping up their shrinking margins) as something more palatable to investors (AI).
Gosh...
The job market is already brutal for many candidates, especially people who aren’t social media personalities and don’t have names like Cloudflare, Meta, Amazon, or Google on their CVs. Some people will end up homeless...
At least having Cloudflare on their resume will likely help many of these people land new opportunities, so I wouldn’t be too worried about their long-term prospects...
What I don’t fully understand is why a company like Cloudflare decides to let experienced people go under the umbrella of “reorganisation.” Couldn’t some of them be given the opportunity to adapt to new priorities or ways of working?
What exactly is so fundamentally difficult in 2026 that someone with years of experience can’t learn?
Of course, large organisations sometimes develop dysfunctional habits. I’m not saying that’s necessarily the case here, but common examples include:
1. Problems that a motivated engineer could solve in minutes instead turn into meetings scheduled a week later, followed by more meetings.
2. People are becoming so process-oriented or conservative that they reject new approaches by default (Not even trying things out, and I don't mean migrating to a new fancy framework)
3. Engineers losing touch with product thinking and customer impact.
And if the explanation is cost-cutting, it’s fair to ask where companies choose to spend money elsewhere, e.g. unlimited LLM token usage with little accountability, extravagant off-sites, flying thousands of employees to expensive locations, etc.
Finally, why do they keep hundreds of job openings on their careers page? Are those false job descriptions wasting candidates' time?
> Couldn’t some of them be given the opportunity to adapt to new priorities or ways of working?
They could. You should be asking whether they want to or not.
The AI argument doesn't make sense to me for layoffs. If AI is making the company more productive then there's an incredible opportunity to use the existing workforce to tackle the massive backlog of important work. A big layoff only makes sense if there is no more useful work to do or you're killing products.
It's AI but not in the way you think.
AI usage is getting expensive since Anthropic et al are turning the screws, and that money has to come from somewhere. Reducing AI usage is blasphemy of course, so cutting headcount is the only path forward.
Is there no one figuring out ROI on AI spend vs human payroll? I can't make sense of this idea that companies are firing productive employees because they're spending too much money on AI that isn't doing anything for them... they still hope chatbots will be worth it in the future?
> ROI on AI spend
You say that shit like that at the top table and you will be gone within the hour.
The FOMO is real with execs and AI.
I've said that shit at the top table and I'm still there. In fact it started some great conversations to ensure we're doing just that.
It's not that simple.
The marginal gains are inevitably diminishing (since you pick the lucrative options).
There's a practical rate at which work can be done, limited by all sorts of things like organisation friction, how fast customers are willing/able to adopt new features, and how fast you can learn from it.
Arguably AI can improve all of these, but those improvements might not be happening as fast as CloudFlare are able to pump out features.
Further, this is all exacerbated by upper management having to made decisions at the nth derivative. Meanwhile, salary costs you now. You might foresee vast riches in future, but you have to remain solvent and competitive until then.
These all points towards layoffs. There are many factors that point towards keeping employees.
How to decide? No idea. Rightfully no one trusts me to make these!
It's such a bad time to be laid off right now. The competition is ridiculous. I have to compete with like 100k world class employees. Best wishes cloudflare former employees. I hope some of you make new companies and hire other geeks who are on their butts. A lot of us at other companies got the boot with no severance or early stock vestings. It could be worse!
I dislike the title because it doesn't clearly state it's a layoff. "Building for the future" gave me the impression that it's about some major new initiative with a roadmap outlining plans.
It's interesting how every time there's a layoff, the blog post always has a title like "Preparing for what's next" or "An update on our workforce" or "Getting ready for the agentic era"!
They should make it “Good news, everyone” like in Futurama.
Welcome to the corporate world
Two days ago: “Today I've made the difficult decision to reduce the size of Coinbase by ~14%” (layoffs) https://news.ycombinator.com/item?id=48021368
This is what the true definition of "AGI" is.
The title should be something like "Cloudflare reducing workforce by more than 1,100 employees globally".
Yes, and such titles (whose purpose is to not say the thing) fall under "misleading" in https://news.ycombinator.com/newsguidelines.html.
We've changed the title along with the URL - see https://news.ycombinator.com/item?id=48058224.
Maybe I've become cynical and jaded, because when I saw the title I immediately thought to myself "oh, Cloudflare's announcing a layoff."
The corporate speak isn't working if people instantly know what it means!
It's like slurs; an ever-moving target.
Even so, "Daddy needs a new yacht" might sound too insensitive.
> "Building for the future" gave me the impression that it's about some major new initiative...
If you'll believe them, it indeed is:
They're architecting their company for an agentic future? They're reimaginging the definition of a world-class, high-growth company? They're not resting on the workflows that worked yesterday? blegh
What the hell does any of that actually mean? Like in real life words? Because that much corporate bullshit really sounds like it is a cost-cutting exercise.
Yes. We've since changed the top link to a third-party article. We prefer to do this with corporate press releases* - this is probably the #1 exception to HN's "please post the original source" rule (https://news.ycombinator.com/newsguidelines.html). If anyone sees a better third-party article, we can change it again.
(Edit: it's not really an exception because the purpose of a corporate press release is usually to obscure the main story, which means it's misleading, so by HN rules we should change it.)
(Edit 2: I feel like I should add that this isn't specific to Cloudflare! It's literally a generic problem.)
* https://hn.algolia.com/?dateRange=all&page=0&prefix=true&sor...
Thanks for changing this dang, I and all of us really appreciate the work that you do towards hackernews :-D
Have a nice day!
I’ll never forget how when I was at Google, every email with subject line “An update on X” meant X was getting axed. Like, just say so in the subject line…
It got to the point where people were sarcastically posting "An update on <myself>" when sending goodbye emails.
It looks like they are using the "agentic AI era" as an excuse to restructure in order to boost margins. GAAP gross margin dropped ~5 points YoY (76% -> 71%)
Yikes, so incremental margins are in the 50s. I think this says it all.
Whatever the play here they can’t be angling for any external PR or internal morale boost. What if they wrote: “This is a tough economy and we have to tighten our belts.” Maybe that’s naive of me. Bad signal to investors as opposed to insignificant employees and commoners (PR)?
But contrast with this:
> The way we work at Cloudflare has fundamentally changed. We don’t just build and sell AI tools and platforms. We are our own most demanding customer. Cloudflare’s usage of AI has increased by more than 600% in the last three months alone. Employees across the company from engineering to HR to finance to marketing run thousands of AI agent sessions each day to get their work done. That means we have to be intentional in how we architect our company for the agentic AI era in order to supercharge the value we deliver to our customers and to honor our mission to help build a better Internet for everyone, everywhere.
What is this even saying? We use a lot of AI. And not just for other people... for ourselves. This means that: we need to be intentional?
What is a regular, not-investor, person supposed to glean from this? We’ve hit the automation jackpot: some of you will be fired, some of you will get more work for the same pay?[1] Along with shoving your face with euphoric buzzwords “AI era”, “supercharge the value”.
I must surmise that whatever PR and internal morale blow (?) matters so little to them. They are not at all afraid of any backlash from any lowly people.
[1] Again. This paragraph isn’t saying anything beyond that they are using AI and ho-ho things are a-changing. So one has to guess.
Wonder if they used AI to write it. "We don't just [x]. We [y]" strikes again.
Gross margin doesn't include r&d and it looks like a bunch of engineering was laid off too
Yikes, this sucks.
It is ironic that Cloudflare is letting go 1100 of employees, while roughly 6-7 months ago, they were aiming to hire 1111 interns.
Article: https://blog.cloudflare.com/cloudflare-1111-intern-program/
They're still keeping the interns. Feels very much like a 'replacement'.
Am I math-ing right that this creates a 1:4 employee to intern ratio? (5000 x 20% layoffs = 1000 redundancies; 4000 employees and 1000 interns?)
The 1111 interns are spread throughout the year, so this summer there will be about 500 interns among 4000 employees.
"We are our own most demanding customer. Cloudflare’s usage of AI has increased by more than 600% in the last three months alone. Employees across the company from engineering to HR to finance to marketing run thousands of AI agent sessions each day to get their work done. That means we have to be intentional in how we architect our company for the agentic AI era in order to supercharge the value we deliver to our customers and to honor our mission to help build a better Internet for everyone, everywhere." As an English enthusiast, I'm getting very frustrated at how the language is consistently abused in executive communications to write words without saying anything.
The implication that is NOT said is that suddenly 20% of people were sitting around without any work to do because AI was making everyone so efficient and productive. This does not, however, seem to be the reality, based on conversations within the company. It appears we have yet another case of economic downturn disguised as increasing velocity.
The bottleneck is never code
Bill and Upwork also have announced layoffs today.
https://www.upwork.com/press/releases/upwork-ceo-hayden-brow...
https://www.bill.com/blog/a-message-to-bill-employees-may-20...
Wow, the way Upwork is handling this seems really bad. They announced the layoffs today, but nobody will know who is being let go until next week! Sheesh.
Executive: "Give me a title for the blog post where I'm laying off a bunch of people".
AI: "Building for the Future".
Executive: "Thank you! I knew it was the right decision".
Clearly if AI were the productivity booster that we're told it is, you'd see hiring into it, not firing. Though I guess on the call Prince did say he expect end '27 to have more employees than for any of '26. Anyway.
I don't think productivity boosters lead to net hiring or firing, but I do think they lead to higher wages.
Building for the future is great!
Except for one small, very tiny, itsy-bitsy problem. We humans are very bad at understand the second and third order effects of events. Really, really bad. First order consequences: "Oh we don't need people anymore".
Do I know the second order effects? Probably not. But at least I know they will be there.
Letting go 1,100 people into a bleak job market. Absolutely awful.
It wouldn't shock me if people formerly in tech have changed careers entirely, seemingly every tech-focused company is laying people off in favour of AI.
Cutting salaries to pay the AI costs for the remaining engineers. Going to be rough as this trickles through the entire economy over the next 10 years.
I know this is cold comfort, but in times like this, it can be a good idea to start your own company. Cloudflare itself was founded in the wake of the GFC (post-2008), when tech was dead as a doornail. The best time to start something is when awesome people to work with are unemployed.
Makes sense to do these things. To realistically make it through this paradigm shift you need to organize into a thing that can exploit it. That inevitably requires eliminating teams that don't fit into the new picture. The severance package seems quite generous. Hope everyone lands on their feet.
It's not that individuals are not useful, or even that their roles are not useful. It's that you have to structure your organization to be able to exploit a coming wave, and existing mechanisms and operations just get in the way. By the time Netflix shut down the DVD business it was making $80 m in revenue and the margins on that business were some 50%. But if you think the writing is on the wall, you're forced to act.
Doesn't mean the people in the DVD-mail-ops sides were bad at what they do. The world had just changed and the business became different.
Okay, so what is Cloudflare's "DVD" equivalent? And what about AI necessitates smaller teams?
"We are reorganizing for the agentic AI era" reads better than "our gross margin is compressing, our SBC is too high, and our growth is decelerating." Both descriptions could be true; only one gets you a flattering blog post.
If you were impacted Magnetic (AI Tax Prep for CPA firms) is hiring senior - staff level engineers in SF https://www.ycombinator.com/companies/magnetic
I interviewed at cloudflare in ~2020 and didn’t get the job - everyone I met during the process seemed really smart and kind though. Would love to work with some of those people
Email me subject “cloudflare” if interested - thomas@ our domain (I am the cofounder)
Prince is claiming they laid off very few SWEs, I know at least an entire team of SWEs.
https://x.com/eastdakota/status/2052560831909433554?s=20
Doubt. The eng teams I know lost 15-25% of their SWEs.
The sre team I was hired onto last month, just lost 2 of ~12.
Cynically: our team hired two (me, senior, and a junior) and then we lost two (staff, guy who had been around since the founding, and a senior+ guy)... I kinda assume they baked in some of the layoff decisions into their past quarter or two of hiring to reduce seniority, and salaries, overall. Really short-sighted.
I was still needing to get some 1:1s scheduled with the guy who'd been here for Forever and knew which closets had all the skeletons stashed away. Can't do that now.
My response to this, as a generally satisfied CloudFlare customer who was excited to try out agentic email, is that it's not a good time to increase the amount of business I do with them.
A few people here have been impacted, so I want to talk about something constructive that could help them. As someone observing industry trends from the outside for a while, my advice to those looking to get hired these days: Build something useful from scratch – on your own –- that you can show off as soon as possible.
The buzzword everyone is looking for is "high-agency." (No, not those agents, but yes, those will help.) Basically employers want someone who will start something from scratch and take it to the finish line by themselves.
The interesting thing about this is, it is by definition not something you can put on your resume; It is something you show, not tell.
Yes, you need to do this even as you go through the absolute hell that is a job search. But trust me, this will a) help get a much better job, and b) help in the long run throughout and beyond your career. This will be the most valuable skill in the future.
You don’t need to use AI, but looking at the timeframes and skills in demand, yes, you very likely want to use AI.
A few other thoughts:
1. Target an area you are very familiar with. This will sharply cut down the time to MVP. This will be a challenge for the more junior folks, who should consider reaching out to senior mentors. Mentors, consider outsourcing a suitable personal project to them.
2. It could be something you are an expert on at work, if your employment contract and IP laws allow. As a bonus, releasing this as open source, or even a competing product if you’re so inclined, will have that intangible bonus of sticking it to your ex-employer.
3. Even if heavily using AI, keep your hands-on skill active. Most companies still do old-school leetcode interviews.
4. Bonus if you do something multi-disciplinary. Sprinkle in a domain you have no background in -- design, writing, sales, marketing, data science, frontend, whatever. You'll definitely need AI for this, and even when you make mistakes, few will harshly judge somebody down on their luck trying to expand their boundaries.
Hope this helps, and all the best!
I understand that your advice comes from the right place. However "High-agency" is the "Full-stack Engineer" of the AI era.
A single salary covering many disparage positions and roles. It's been reworded b/c with AI, apparently you don't even need to be an engineer (or expect to be paid as one) anymore!
Nothing new under the sun.
Hmm, I think "generalist" is the more current term for "Full-Stack Engineer." But that's more about technical skills. "High-agency" is more a combination of personality traits and technical ability.
So in terms of buzzwords it would be something like generalist + self-starter + go-getter + hustler + finisher.
They won't say it, but everyone wants basically a solo founder, except one who (to your point) gets paid as an employee.
Which is why I am saying this is going to be the most important skill. If they don't pay you enough, you could just go be a solo founder for real.
Worst part about the ai era is that so many are convinced they can and need to be on top of it to the extent of losing their core competency while mass producing trash
It’s good stuff but there’s room for a lot of things
Fyi, the CEO claims[0] they fired very few engineers. The prime target were allegedly salespeople
0: https://x.com/eastdakota/status/2052560831909433554
makes sense, their revenue is atrocious
This comment should be higher given how much FUD is in these comments. Hacker News having a meltdown about a bunch of backoffice folks getting laid off while they’re still aggressively hiring SWEs is… something
People who lived through 2001 and 2008 crashes, did it look like this or was it even worse than what's happening these days with so many layoffs?
2008 really wasn't that bad if you were in tech...
No idea about 2001, but I've heard it was fairly rough. More recently I've seen people say now it's harder to find work today, I think in part because in 2001 it was mostly tech companies laying off talent, while corporates who were less impacted by the dot-com bubble were still building out their engineering teams.
I agree. It was still ok for most people in tech. Maybe rough for that single year. After that is was nothing but boom times.
I can't speak to 2001.
This feels like something much worse and weirder.
The problem with the 2001 dot com bust was that it came on the heels of the telecoms downturn, so the two biggest (at the time) tech sectors were in trouble simultaneously.
Yes, there was still corporate IT - and some areas like finance were positively booming. But for online retail, media, advertising, etc it was a wasteland for 4-5 years. Plenty of people never found a way back into the industry.
To me, it felt much worse then than it does now (though perhaps the USA is being hit much harder at the moment).
2008 did hit tech but, outside of finance, the shock was over much quicker. The effects on the bricks & mortar economy were more obvious, though, so it got covered more in the media.
I don't remember 2001. But 2008 tech job market was way wayyy better than today.
2008 the global economy came somewhere between hours to days of completely crashing if AIG hadn't been bailed out. Other than Covid, it's only the second time in the past 50 years unemployment hit double-digits, the other time being the early 80s recession in the wake of the 1979 energy crisis, which saw inflation go as high as 13.5% and the prime interest rate hit 21.5%. You're probably only concerned about your own industry, but even now, unemployment is still around the lowest it's been since WWII outside of the past couple of years and the late 50s.
It'll be another 40 years hopefully to get a full lifetime of experience and see how I ultimately feel about this, but right now, my sense is software saw a huge boom in the 2010s, a la aerospace in the 60s and finance in the 90s, and it isn't going to die, but that boom was never going to last forever, either. Being a specialist surgeon was always the only true close to guarantee you'll make half a mil annually with supreme job security. Everything else sees booms, busts, regional disparities, and power laws that make it hard to even talk to each other about it because nobody's experience is universal. Even now, in my particular niche of the industry, I don't know anybody who's been laid off. My own company and our competitors are not exactly drowning in cash (I work largely on commission and it's been a terrible quarter), but we're expanding headcount, not reducing.
Conversely, in the 2010s as software boomed and I did terrifically, basically my entire family is in trades and it was totally different for them. Drastic cyclical instability, projects started but then canceled all over the place, injuries, bankruptcies, drug addiction, prison terms. But that's also in California. I live in Texas and construction here seemingly mostly stayed in the boom state. All the tradesmen I know from here rather than family did much better. We also had roughneck as a lucrative fallback option for anyone that didn't mind living in the middle of nowhere thanks to the fracking and shale booms. Computer geeks from 2006 to 2021 or so also had that kind of easy skill transfer fallback thing thanks to the boom in computational data analytics due to advances in data storage and machine learning technologies.
We might even do well to remember that hyperscalers drowning in ad money for the past 20 years had a practice of intentionally overhiring to hoard talent but not give them anything productive to do, putting them into restrictive NDAs and non-competes largely to prevent them from starting their own companies or working for competitors. If that practice is ending, it floods the labor market, driving down wages, and reduces industry-wide employment metrics, but it's not death of the profession so much as ending a market distortion. Maybe it even supercharges entrepreneurialism, but right now we just seem to see a boom in the "solo indie dev" putting out reams of slop. At some point, people have to actually work together and have a real product vision that solves a problem other than using AI to make dev tools to harness AI for making more dev tools.
2001 affected tech mainly, so a lot of folks went to other industries still hiring. And 2008 affected other industries more than tech, so the inverse.
it was worse
The problem today is we had 10 years of “learn to code” and a a lot of people did. Similar to 2001. 2009 wasn’t really bad for tech since we had a huge shortage of workers in the space. Companies would hire straight out of mid-tier universities. CS departments were desperate for students.
From memory, the only recent layoff where the company was not only profitable, but also growing is this one.
It's not clear if we are at the beginning of a crash or if the everything-bubble still has some pressure to expand. But whatever impression people can report here are about the past, and thus not about any crash.
2001 set tech jobs back a few years. 2008 wasn't nearly as bad for tech because as money got tight, there was an impetus for companies to invest in tech to cut costs. I think a similar thing might be unfolding now with non-tech companies investing in AI to streamline processes.
Obviously AI is just a excuse
It’s not like this is a factory floor where you process something coming in and AI suddenly makes the process more efficient and people are idle. Every team in tech world has infinite backlog, you don’t fire 20% the minute someone manages to close a few tickets.
why not? isn't the implication of your point that companies should just hire infinitely so long as there's work to be done?
Companies never want to reduce productivity unless they need to cut spending or increase profits. In other words, if AI increases productivity that’s a direct win they can use to beat their competitors. You can’t spend money you don’t have, but you want to spend the money you do have as point at there work to do, which there always is.
> unless they need to cut spending or increase profits
yes, so basically always? the situations where companies don't want to do this are very rare.
I understand your broader point that doubling down on productive things is useful. But there's no limiting principle to that idea.
The obvious reality is that businesses are trying to find a sweet spot between expenses and productivity. It's not always the case that slashing spending is worth it. But it's equally naive to act like being able to do more with less shouldn't make you want... less
> Every team in tech world has infinite backlog
I have non-tech friends who struggle to understand this, because they literally clear their entire backlog of work every single day they're at work.
then they basically don't do knowledge work
Some of them yeah, they do jobs involving physical work, but some of them are office works — their jobs/companies are just set up so that they've got a defined set of tasks/responsibilities, and they're able to complete them all every day. (Or some/most days.)
They find the idea of an infinite task queue horrifying.
Many CxO made a decision to spend $$$$ on AI; that's their bet and they're are adamant about it. Money should come from somewhere and layoffs is the easiest way to free some budget in a software company. Was it a good bet only time will tell.
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.
Yeah, I just don't understand the thinking here on HN anymore. (My account is 15 years old)
It was clear to me even before ChatGPT arrived that software was eventually going to go the same way agriculture went. We will simply need fewer people to do the job than before.
I don't buy that AI will completely automate away all software engineering. I think if you're not in the top ~40% skill wise, you're in serious trouble and have a bleak future.
I think we're probably past peak employment for software engineers, but I'd also be surprised if these layoffs were directly related to Cloudflare thinking they can replace their engineering teams with AI agents.
Eh... Are you claiming the dollar inflation is caused by AI?
Or rather, are you claiming it's caused by productivity gains from AI?
With the hiring 1111 interns thing, I think these companies (amazon as well) need to realize this is doing anything but inspiring confidence in those interns. Instead of being excited about going there, more of them would opt to go elsewhere instead of returning full time, or if they do return full time they'd be in fear of being let go next.
When you announce 639m USD revenue for q1 Then lay off a thousand people because you love the smell of your ai farts.
Revenue != profit.
Thousand people cost 60m USD of quarterly _profit_ though (not even revenue)
That’s not how accounting works.
Are you trolling or just trying to avoid saying they didn't make any money and actually lost over $20 million?
Flippant sarcasm that they're pretending this wasn't a financial decision, and was entirely about being ready for the amazing productivity gains of ai they've already seen, expanding across the business.
Yes, their revenue was $639m but their expenses were $702m.
It doesn't matter how much revenue you have if you are spending more than that.
Expenses were more on purpose, they amortized a bunch of hardware depreciation now instead of over 5-7 years with the new tax changes. This is pure greed
It's interesting to me that this is lower on the HN page than the Cloudflare post talking about the CVE handling even though the scoring is higher.
EDIT: Now it's off the main page, because of course it is.
it's about the comments / votes ratio.
To be more specific, it is a heuristic for detecting flamewars and/or controversial topics and it is quite good at that.
why exactly do we want to damp flamewars by comment count? as long as an individual comment fits the rules why do we punish comments in aggregate
Because it's a global optimization problem and HN gets less optimal* when there are flamewars on the frontpage.
Do you have a different approach in mind that we could do instead?
* https://hn.algolia.com/?dateRange=all&page=0&prefix=true&sor...
right but feel like comment count is a poor proxy for flamewar in an age where cheap intelligence to semantically classify discussions is available, so that, as affected me in the past, an author of a post simply enthusiastically engaging with every reply is not punished.
maybe to put it in a way where your values are aligned, i'm a curious person, and i learn a lot from the discussions that happen right on HN rather that only going to the source.. indiscriminate comment count damping takes away/lowers visibility of the most interesting comments that would provoke my curiosity.
one could instead do any sort of basic classifier system ranging from bag of words to running a ModernBERT to rate flamewarness and differentially apply the downrank based on "flamewar score" rather than "really poor proxy to flamewar score"
I don't see how laying people off isn't inherently and always a "cost-cutting exercise." If they had an unlimited budget, they probably wouldn't be laying them off, right?
Maybe it's supposed to mean that it's not... something more specific?
Any other engineers just living life frozen at this point. I am unable to make any life decisions because it seems like I won't have a career in the near future. I am unable to purchase a home to settle down for my family, because dad might not have a job next week. I know I am fortunate to have a job, many don't, but fuck if this career isn't the worse thing ever for my overall health and happiness.
Yeah I'm there with you. I got lucky as a kid with delving into this as a hobby and it turned into a professional career. Thought we could change the world for the better, what we made instead was social media cancer and LLMs that can pretend to make everyone 10x more productive. I loathe it.
As long as it's pretend productivity, things should settle in a decent place. How long that takes, who knows.
I've been out of work since almost a year ago after getting laid off and the same is true for a lot of my coworkers; the job market is absolutely broken in half for a lot of different but related reasons. Thankfully I have significant savings and low costs so I can just coast and do stuff in my own time, but the same hasn't been true for others I know.
Frankly I fully expect people to get even angrier once they become unable to meet the bills and companies still tout the whole AI line.
Absolutely. News like this is so hard to ignore. Nervous as hell to drop big money on things the family needs right now. Grateful to have a job, but life overall was just better in almost every sense before AI became part of our daily vocabulary and layoffs occurring every couple of weeks.
Yes - I was thinking about starting my own business but am staying put instead and saving as much as possible.
now seems like the perfect time to start a business?
If you have savings
I'm sure this is going to happen a lot to big companies, with AI they are all going to find they have too much staff and are not likely to benefit from a higher pace of development. Smaller/Mid size companies on the other hand are likely limited in how much staff they can take on and AI just accelerates their plans (I'm in a company like this).
That's 2 major layoffs this week (Coinbase being the other). Is there an underlying common reason for this? And is it indeed AI-driven productivity as both companies claim?
Employees cost money. The ZIRP free-money era has ended. Companies have been laying off tech people for the last few years.
Also the US economy is collapsing, that probably has some relevance.
You couldn't tell this by looking at the stock market.
Which is the point. There's been a concerted effort by the government to make this the story.
Layoffs and cost of living problems but you must discount the evidence of your eyes and ears and remember it's over 50,000!
The PE ratio of Tesla should tell you everything you need to know about the stock market representing actual economic conditions.
To me, it just means a dollar doesn't buy as much of IBM as it used to.
Stock market is up only because investors bet on AI, if you'll exclude AI and AI supply chain at best it would be stagnant.
Whenever someone brings up ZIRP, especially someone with a username like yours, it's an indicator that they have no clue what they are talking about and like to regurgitate things they read on the internet.
> Also the US economy is collapsing, that probably has some relevance.
Right...wait, what?
>especially someone with a username like yours,
> -- blingbot9 2026
a new level of ad hominem
Zirp ended over 4 years ago, what are you talking about, the us economy is collapsing? What? Care to elaborate on any of this?
Coinbase for sure is driven by declining Bitcoin fundamentals and entry of other big players in the Trump inner circle. The AI narrative is a lie.
Cloudflare was overvalued and missed extreme expectations (down another 12% now).
By this time I wonder which investor still believes the AI excuse.
There's multiple simultaneous narratives: the industry-wide one of slashing well-paid tech talent under the guise of AI productivity boosts, and what's actually going in at each company.
Cloudflare is an outlier because the company doesn't actually make money at present; their past three annual statements show net losses in the tens to hundreds of millions of dollars. Not hemorrhaging cash per se (their cash reserves alone could cover ~9 more years of losses), but still enough to warrant some cutbacks - and AI is the current scapegoat, thus they finger AI and throw folks out the door.
Coinbase's story is different: they're making good money, but their industry is inherently volatile. Again, recent volatility in the crypto markets related to...things...is dragging down long-term prospects for currencies, while ongoing trades are broadly just insiders doing insider things or exiting their positions for liquidity. Still, their share price is down 27% over 5 years and 18% YTD, so they also need to pump their share price so the executives get paid; layoffs are consistently rewarded by the shareholders, thus they axe part of their workforce for the bump and fingerpoint to AI.
Never take what a company says at face value, and always check their balance sheets. What Cloudflare did sucks but could be warranted to some degree; what Coinbase did has no justification whatsoever beyond naked greed.
Its quite filthy but it benefits them all to lay off lots of people to reset the wage rate in the market... Im sure we will see a wave of re-hiring when this stuff starts to blow over but many initially will be at a much lower wage rate.
> Cloudflare is an outlier because the company doesn't actually make money at present; their past three annual statements show net losses in the tens to hundreds of millions of dollars.
Their free cashflow is high; they're choosing not to report a profit. I don't think it's useful/accurate to say they don't make money.
Don't get me wrong, they may be doing a layoff to boost margins or enter GAAP profitability but the company revenue exceeds its operating cost by quite a bit.
See in their latest quarterly report: https://cloudflare.net/news/news-details/2026/Cloudflare-Ann...
> First quarter revenue totaled $639.8 million, representing an increase of 34% year-over-year
So they're growing 34% annually.
> Free cash flow was $84.1 million, or 13% of revenue, compared to $52.9 million, or 11% of revenue, in the first quarter of 2025. Cash, cash equivalents, and available-for-sale securities were $4,163.9 million as of March 31, 2026.
...and they have $84 million free cash flow in one quarter, and it's consistently pretty good cashflow.
And they have $4b of cash or cash equivalents stockpiled. It seems pretty healthy to me.
Is Coinbase that major though? they're always doing lay-offs.
I think there's also a certain permission structure that once one sufficiently large org does a big round of layoffs and doesn't get punished, a bunch of others will run the same playbook. We've seen this before -- back in 2022 when Elon fired like half or more of Twitter and the service didn't immediately implode, it gave other CEOs permission to do massive layoffs in the guise of "efficiency" even though the real reason was ZIRP was over. Now they're claiming it's because of AI when it's really that their margins are eroding because the overall economy is slumping and they need to offset AI spend.
Meta's layoff was also last week, much bigger than both.
AI productivity is a lie. It’s AI spending because the revenue hasn’t gone up.
Coinbase lost 40% transaction revenue. The AI thing is just smokescreen
https://finance.yahoo.com/markets/crypto/articles/coinbase-s...
It seems that Bill.com and UpWork, too!
At this point, the thread has over 700+ comments, but if any impacted Cloudflare folks see this and are interested in working on the same shape of problems, Fastly posted our "Who's Hiring?" for May at this link https://news.ycombinator.com/item?id=47975839
Happy to answer any questions, though I only check HN about once a day.
You can lead an american to his firing, but you can't make him unionize.
> The way we work at Cloudflare has fundamentally changed. We don’t just build and sell AI tools and platforms.
Anyone else stumbled over that part? That is not at all how I perceive CF.
Not sure how to feel about this. On one hand, the transparency about the layoff and the severance package for the employees are positive things.
But seeing the intern hiring count the year before basically offsetting the layoff headcount makes me think they've been planning to replace their employees with interns and plug the expertise gap with AI.
Really sorry to see the news about the RIF. My thoughts are with everyone affected.
If you (or someone you know) were impacted and want to stay in the distributed systems or data plane space, we’re doing a lot of work at Kong ($2B valuation API & AI governance company) on high-performance proxies, control planes, and Rust, Golang, etc. (I used to work on Cloudflare's edge proxy project)
Happy to chat about the roles or just the tech stack in general if you want to geek out. Feel free to reach out: datong#konghq.com
Companies like cloudflare operate at a very critical spot as of today. They manage the end points where TLS terminates for most of the internet traffic which means that they have access to all the information flowing through them in clear. When a company is so much motivated by the profits then it would not be too far away when they start selling all this information. With this much centralized control, they can easily turn to abusers instead of being internet gatekeepers for profit. Firing so many people is bound to disrupt the operations, the only question is how much can they can hide/manage.
> When a company is so much motivated by the profits
That is what a company is for.
I think this is the reason why the detailed definition of companies varies, the motivation and regulation on a company varies too. Absent the regulations, financial institutions would have run off with the money by now
You have however many people who you seem to believe have no useful work to do in their current roles. You aren't bleeding money. Is that not the time to invest in new products? To take moonshots?
Is this not admitting that they simply can't come up with any new ideas to invest in? That their intellectual capacity has topped out?
Profitable companies laying people off like this tells me they're done innovating and now it is time to milk the cash cows for all they're worth.
Wow, and I had thought they would be one of the winners in the AI era. A lot of SaaS's can be recreated with an agent and some tokens, but I thought the more infra-y companies would be the beneficiaries. I've vibe coded a few Cloudflare Workers and thought it was a great experience. And Claude knew how to use wrangler to do a lot itself.
layoffs are winning in the short term. investors love them, and if you cut staff but keep revenue that’s profit.
From the announcement it doesn’t seem like they’re losing, just that they’re cutting off their employees winnings.
Isn't the most likely explanation here that they needed to show in their earnings call how their bet on becoming AI infrastructure is leading to high revenue growth expectations, and that isn't happening (yet)?
The stock is currently at -17% in after hours trading.
So you need to do something that's good for your margins to show investors.
TBH I'm surprised people don't see the obvious result of this collective madness:
1. Force every engineer to use agentic AI to the max.
2. Constant anxiety at work due to the threat of job loss and unreasonable expectations from management/business.
3. Engineers start yoloing everything using AI while wasting tokens.
4. Speed goes up in the short term, while quality and expertise degrade little by little, all while bleeding money due to AI usage.
5. One year down the line you have a company full of engineers that don't care and a bunch of slop-bloated, bug-ridden products that the customers don't want, and a massive bill.
6. ceo/cto see the writing on the wall and exit before any blame sticks, receive a nice exit package, find another company to ruin
IDGI. How is a company that owns a bunch of infrastructure you almost have to use to put your service on the internet not more profitable such that they have to do layoffs?
Unlike the other hyperscalers, they don't attempt to wring every last dollar from their customers' wallets.
>Cloudflare expects second-quarter revenue of $664 million to $665 million, just under analysts' estimate of $665.3 million
Is this considered below expectations on wallstreet... enough to merit an 18% stock cut?
Analysts are the worst…
Screw Cloudflare. I went through a bizarre 3+ months hiring process where I would have a disconnected, vague 30 minute interview with someone every couple weeks. Then, suddenly rejected for no real reason given.
Their hiring process is remarkably bad for a company that otherwise is so well run. My most recent experience was them throwing a workday link at me to fill something out before we even had the initial phone screen and the forms/ui was so poorly designed that I stopped responding to them.
Lets not miss the obvious: cloudflare is not profitable. I believe the board is probably telling the management that they need to cut costs.
All this “AI bla bla efficiency bla bla agents bla bla” is a convenient excuse.
Sorry to everyone affected by this. If any infra/platform folks in Europe are looking, Luxonis is hiring a Senior DevOps / Platform Engineer. It’s remote in Europe, focused on cloud infrastructure and internal developer platform work for spatial AI / computer vision products: https://www.luxonis.com/about-us#devops-engineer
Wow, can't say I saw this one coming. Cloudflare has been putting out a lot of strong work lately. What percentage of their workforce is this?
20%
That's massive
Why are they laying off anyone when you got 500 million plus in pure profit. The tax system needs to be reworked to not incentivize layoffs. Major taxes should happen to support the well fair system in order to support people laid off. This is a stupid system we live in.
I feel like they overhired over the years and now they reap what they sow. AI just accelerated their awareness of overhiring. I think if Cloudflare or any other well established software company stopped hiring this year, they would be doing the same as they did last year. At the end even the management will be replaced by AI.
Getting laid off in this job market is absolutely terrifying.
Hope everyone affected land on their feet.
"We are our own most demanding customer. Cloudflare’s usage of AI has increased by more than 600% in the last three months alone. Employees across the company from engineering to HR to finance to marketing run thousands of AI agent sessions each day to get their work done. That means we have to be intentional in how we architect our company for the agentic AI era in order to supercharge the value we deliver to our customers and to honor our mission to help build a better Internet for everyone, everywhere."
So basically, there were too many people burning too many tokens lol
How wonderful that even CEO Matthew Prince and COO Michelle Zatlyn can be replaced by AI. Maybe not today or tomorrow, but the day after tomorrow.
THEN I’ll be happy when management has rendered itself obsolete and becomes unemployed. Because the AI prompts used to replace the CEO and COO are trivial.
So let’s hope for the day after tomorrow!
All the AI stuff is just noise to make it sound better - the real issue is the economic downturn.
If anything, AI makes each employee much more valuable because they can be much more productive and most big companies always have stuff that needs doing and opportunities for growth. So it's a sort of Jevons Paradox[1] situation but where human labour is the resource.
How wonderful that even CEO Matthew Prince and COO Michelle Zatlyn can be replaced by AI. Maybe not today or tomorrow, but the day after tomorrow.
THEN I’ll be happy when management has rendered itself obsolete and becomes unemployed. Because the AI prompts used to replace the CEO and COO are trivial.
So let’s hope for the day after tomorrow.
Their stock has gone down nearly 20% in early trading today. When layoffs happen, usually it is the opposite, so I imagine Matthew Prince must be annoyed!
I am disappointed by this decision from Cloudflare. I've always felt that massive layoffs are something that companies who are greedy and don't care about their employees do (like Amazon and Meta). Up until now, my impression of Cloudflare has been that they care about their societal impact to an extent and still share old values from how tech companies used to be. Maybe they're starting the downward make-money-at-all-costs spiral that has gripped the rest of tech.
Their valuation is crazy. Trading at $260, with no profit, their price:sales ratio was 36x (extremely high). Now, trading at $195, their price:forward earnings ratio is 130x (extremely high). Unless they crushed earnings and revenue estimates and juiced their forward guidance, Cloudflare stock could have gone anywhere. Also, the stock is trading where it was a month ago.
Why does "the future" in corporate announcements always mean layoffs?
I've been slowly moving all of my stuff over to Cloudflare. This certainly does not inspire confidence to continue down that path.
I find it surprising that the word "incident" doesn't yet show up on this page. Cloudflare had at least two nasty incidents a few months ago. It certainly shook my confidence in the company's ability to run its infrastructure.
20% is a crazy number. This is scary, as someone who works in this industry.
Surprising that the share price took a dip on this. Normally retrenchments are seen as a plus
They want to polish upcoming employees into getting more used to AI tools usage but they don't want keep burning cash on experienced ones. They have to establish more YOY growth. Looks like everybody has to justify in the market why they need AI agents more than employees.
Thats a solid package tbh
Yes I am jealous. I'm on unemployment paying out of pocket for health insurance and my unvested stocks disappeared.
Does anyone know if it will affect emdash (an attempt by cloudflare to build an alternative to wordpress - launched on April first this year)?
> Matthew has personally sent out every offer letter we've extended. It is a practice he has always looked forward to because it represented our growth and the incredible talent joining our mission
Who gives a shit if you treat your staff like this?
I will add cloudflare to the list of companies that I’ll never work for. Shame, because it seemed like an interesting place
It seems the market decided to cut 20% of Cloudflare's market cap today.
wish they would have just moved these people to technical support; cloudflares support is the worst i've ever experienced even under business/enterprise contracts (no replies ever in most cases)
The message to every Cloudflare employee is clear: you'll be there for the company when times are hard. But the company will not be there for you when times are hard.
It does not matter if the way we work has changed, or AI adoption has increased, or aliens show up. This is a demonstrated lack of loyalty that would result in immediate termination of the situation were reversed.
The important take away for everyone else is do you trust Matthew Prince to always take the high road and do what is right, combined with the fact that they man-in-the-middle all of your websites encrypted traffic? What happens when revenues are down and the shareholders demand blood again?
You only have to be there for the company in that you do work for them and they give you money in return. Any tech guys working for them will have received plenty of money. I feel sorry for the non-tech people though (HR, recruiters, etc.).
This announcement is bullshit though. Banging on about transparency and then not even trying to give a reason. They didn't even try to say it's because of AI! They just say "AI is important. We're laying off 1000 people." Wtf.
This is literally every public company you just described. Companies do not have loyalty to their employees.
Surprised that this isn't part of a "journey"…
Discussion thread on /r/Cloudflare: https://www.reddit.com/r/CloudFlare/s/47qJtr2yEx
> Cloudflare’s usage of AI has increased by more than 600% in the last three months alone.
So did your outages...
titling "Building for the Future" the announcement of a mass lay-off is disgusting and makes me sick to be honest
is this really the future we want to build?
The future, for those who have the capital. The rest may die, shareholders don't care.
Then we must build our own future. One where we deny the capitalists access to their own automated killer robot armies.
>Then we must build our own future.
Sure. How many of those hated capitalists have started with exactly same thought?
People should stop drop this naive act.
I don’t think I’m the naive one if you think those “hated capitalists” had the intention of building a bright future for the collective us.
> if you think ... had the intention of building a bright future for the collective us.
Never said or implied such thing.
You shot off a one-sentence rejoinder about capitalists building a future. What does it mean? Not worth your time to explain, but worth your time to nuh-huh about your autor intent after the fact.
https://blog.cloudflare.com/building-for-the-future/
"We are our own most demanding customer. Cloudflare’s usage of AI has increased by more than 600% in the last three months alone. Employees across the company from engineering to HR to finance to marketing run thousands of AI agent sessions each day to get their work done. That means we have to be intentional in how we architect our company for the agentic AI era in order to supercharge the value we deliver to our customers and to honor our mission to help build a better Internet for everyone, everywhere."
So basically, there just were too many people using too many tokens LOL
"Enshitification" is not a new concept. A business should always be willing to make their product cheaper, even at the cost of quality, until the customers start turning away. Of course you need to be able to catch that moment early enough so that you don't lose too much market share to competition. But that will give you increased profits. The same with increasing prices.
On a side note, I'm curious as to how "600% increase in AI usage" is measured. Are their agentic workflows' bills skyrocketed 600% in the last 3 months? That would be in line with what other people using agents are seeing (costs are way higher than they expect/used to be). In that case, that would mean that LLM/agents are no longer necessarily cheaper than human labor, no?
Labor market data this week came out stronger than expected, even as large layoffs in IT continue to happen and IT job market continues to be very slow.
Oof. I guess cloudflare is also gonna have an uptime monitor like Claude now.
Can the disgruntled ex-employees contribute to the Puppeteer Stealth plugin? ;)
well at least they're getting some decent severance, still sucks, especially in this market.
Sure, but at least agents can now buy domains!
you can earn and spent but you'll never get enough here too i live in msk, russia and working full time job and yes,married have children
This seems kind of a critical point in time. I consider Cloudflare to be one of the more serious engineering organizations based on the quality of the products. Assuming they are not lying, them cutting 20% workforce citing AI signals there is actual teeth to this AI optimism.
On the other hand "only" 20% for the foreseeable feature is good news? It means there is ceiling to productivity that AI offers.
Or perhaps I am giving Matthew Prince too much credit here, and this is just an opportunistic cost cutting measure.
Optimism?
They make it quite clear that these layoffs are in response to adapting to using AI at the company:
> The way we work at Cloudflare has fundamentally changed. We don’t just build and sell AI tools and platforms. We are our own most demanding customer. Cloudflare’s usage of AI has increased by more than 600% in the last three months alone. Employees across the company from engineering to HR to finance to marketing run thousands of AI agent sessions each day to get their work done. That means we have to be intentional in how we architect our company for the agentic AI era in order to supercharge the value we deliver to our customers and to honor our mission to help build a better Internet for everyone, everywhere.
The rest is hand-wringing about the emotional weight of the decision and what employees can expect from the process.
What remains to be seen is whether relying so heavily on AI will have similar outcomes to what we've seen from Microsoft and others. Which is to say, is now the time to stop using Cloudflare?
Another thought I had:
Companies are starting to realize they have a very captive consumer base. The consumers can't just move. They're collecting money.
It'll take a LONG time for a new competitor to pop up, for them to build out and start to steal customers.
Equally the cost for customers themselves to move is very high.
So in the meantime these large companies realize that by slowing down development they're not actually losing anything.
first slowly, then all at once.
Why is Matthew Prince not fired? They missed EPS and AI could write (or perhaps did write) this entirely meaningless announcement.
What they'll do instead is double down and start another 100 useless AI initiatives that no one wants.
Someone who knows the product deeply and has grown it into what it is today will always stay valuable.
AI can replace people at a low level because they are seen as a cost. While people at the top are better connected.
CEOs travel a lot, probably subscribing to 100 mastermind groups where CEOs of other companies also hang out, playing dozens of mind games and strategising all the time.
Such people are hard to replace. The average employee's role is finite, and they aren't taking much risk; therefore, it's trivial to get rid of them.
I was with you until the talk about risk.
Low level employees are always taking far bigger risks in relative terms, the worse position a CEO will be in if all of his "risk" hits him is that they'll have to become a regular low level employee.
just finance things. nothing to see here...
The day I switched to cloudflare for my domains... one of the best days in my life.
Saving Cost for the Future.
Is the job market bad?
They should have fired 11 people more and match their public DNS resolver 1.1.1.1
I’m finding this a little difficult to square. If things are radically changing within the company and they’re rearchitecting how the company works, wouldn’t they start with a transition period? Letting 1k people go, many of whom will be important parts of the organization, while simultaneously making radical changes in light of a radical rate of change over the last few months, seems very high risk.
Taking everything at face value, does anyone have thoughts on why this change makes sense now vs. in 6 months? Are they ripping the bandaid off or… due to the size of the org?
what does this mean for https://blog.cloudflare.com/cloudflares-commitment-to-free/
TLDR:
free users make Cloudflare’s network smarter
free users create massive scale
some free users eventually become enterprise customers
and the huge traffic volume lowers Cloudflare’s own infrastructure costs.
Shameless title.
Some of this is probably from all the companies they've acquihired, rather than genuine AI improvements.
For example, you probably don't need the extra finance person from the start-up you brought on.
Nice project. The interface feels clean and fast.
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.
-24% now
What the hell!? Cloudflare is absolutely killing it and now they're laying people off! I know some good people there with deep expertise and I hope they're not affected.
My 100% completely personal opinion.
It is not that AI is the contributing factor.
Cloudflare is transforming into yet another surveillance company.
I always see this "Cloudflare ensures you are not a bot" soon may change to "Cloudflare ensures you have a digital ID"
They will not need so many people for this and there will not exist competition to bring better products when people are fired massively and are crippled by financial problems.
AI for me is an excuse. Not the main issue.
It is a strategic transformation to ensure dominant position by killing off competition. Afterall employees are always viewed as threat.
"AI will not replace you, it will just supercharge your existing capabilities."
"lol jk it will totally replace you, bye"
I would think cloudflare would benefit from all the vibe-coded apps as it is an easy target to deploy these on.
Did they find the vibecoding secret sauce?
A message devoid of any meaning. Like wtf does agentic era prep mean? Is their AI spend too high? Are they not profitable?
Also just once, I wish one of these CEOs would give themselves a slap on the wrist and take a pay cut
I suspect that companies anticipate that AI prices are going to go way, way up, and they're going all-in on the current "cheap" credits before then.
I interviewed there over a month ago and they ghosted me after 3 good rounds. I dodged a bullet it seems.
I interviewed, they didn't want to allow remote, requiring me to immovable move to Dallas. The rest of the team was in 5 other cities.
I'd have to move to sit in an office to jump on a Zoom.
...
i will never work for one of these mega big tech companies. making tons of $$$ then fire you. have a nice day.
"You either die the heroic startup, or you live to become the MBA'd villain"
They also reported Q1 revenue up 34% YoY. https://www.techmeme.com/260507/p43 https://www.bloomberg.com/news/articles/2026-05-07/cloudflar...
Cloudflare's stock price has been disconnected from reality for a while.. the only one that's wilder is Palantir which at least has revenue growth numbers that are very impressive.. meanwhile Cloudflare's enterprise value vs next 12 months revenue and revenue growth just don't justify this completely out of whack market valuation. I feel bad that the company has to try and sustainably justify that. It's incredible to watch the velocity of their launches. But I suppose the reality is most of them are just not selling
Didn’t they just recently say they were hiring a huge number of interns because of AI?
The interns are training their replacements. Efficient.
The hollowing out of another iconic American brand begins.
https://polymarket.com/event/another-critical-cloudflare-inc...
AI is so ineffective that compagnies that use it cannot pay their workers ! Poor guys tech bros.
Cloudflare has achieved "AGI" internally.
How about the company just up and dies?
I am getting fucking sick and tired of a “service” that behaves so much like hostile malware and spyware that it gratuitously trips the protections I have added to my browsers and refuses to let me proceed.
Cloudflare is the CP of the Internet: almost no-one wants it, yet it persists like maggots eating the eyes of children.
> That means we have to be intentional in how we architect our company for the agentic AI era in order to supercharge the value we deliver to our customers and to honor our mission to help build a better Internet for everyone, everywhere.
What a load of crap..
"I have decided to sacrifice some of you for shareholder value, but that is something I am willing to do"
That's not good, Cloudflare. Shame on you.
“pour encourager les autres.”
> Cloudflare’s usage of AI has increased by more than 600% in the last three months alone.
It seems only costs increased. If productivity had increased along with the AI costs they wouldn't need to layoff.
Of couse, this is all bullshit. Making a vague gesture at AI makes it sound like the layoffs are positive.
Truth is this is simply cost cutting. Either due to overhiring in the past, or bracing for the likely economic downturn.
>It seems only costs increased. If productivity had increased along with the AI costs they wouldn't need to layoff.
Thing is average employee skill level is low. And entirely replaced by something like GPT 5.5
People have egos and people have "phases" in life. A 10x person isn't productive for all years of their life.
They've periods of high performance, periods of low performance, depression, etc.
Above all, communication overhead is the biggest bottleneck in product development and information withholding and asymmetry.
This makes AI far better because it can simply write all its findings to a file, which you can revisit later.
disappointing
hey now i am from msk,russia and i work as an aenginner, married
I'm not sure why they think I have the time to read all of that.
Who are you?
20% of the workforce is currently being utilised for testing purposes by various companies. (just like we deploy Canary to 10% traffic for test)
In reality, approximately 5-10% of the workforce is equipped with AI technology and can now autonomously manage the entire company.
I am pretty sure CEOs can already see it! Companies create a great deal about the revenue per employee.
Downvoting my statement will not alter the situation, Claude and GPT-5.5 have the potential to replace most system administrators, DevOps engineers, copywriters, support personnel, and other roles.
I have observed this phenomenon in private product companies in India, where I serve as a consultant to multiple companies. I have noticed that 5-10% of the workforce is sufficient to ensure the continued performance of products, with reduced communication overhead, faster updates, and improved reliability.
I also have several side projects that encompass a wide range of responsibilities, so I am not merely a passive executive role.
In India, it has become increasingly challenging to secure jobs in the DevOps, system administration, and frontend domains.
In my opinion, a backend engineer’s job is the most difficult to replace at present, particularly if that engineer possesses a deep understanding of market and product dynamics.