Cloudflare's CEO laid off more than 20% of his staff despite 30%-plus revenue growth, then published a Wall Street Journal op-ed explaining why.
The same week, ClickUp's CEO cut 22% of his workforce while calling the business "the strongest it's ever been." Both pointed to the same reason: AI is rewriting which roles a company needs.
Cloudflare CEO Matthew Prince last week published a Wall Street Journal op-ed explaining why he laid off more than 20% of his workforce earlier this month, even as Cloudflare posted more than 30% revenue growth and strong free cash flow. Prince said he had not found another example in US business history of a public company growing more than 30% laying off more than 20% of its workforce, but predicted "what we did is likely going to become the norm over the next year."
To make the case, Prince reached back to Peter Drucker's 1954 management classic The Practice of Management. Drucker, basically the most influential management thinker of the 20th century, splits every business into three kinds of roles: builders who create the product, sellers who sell it, and measurers, which Prince defines as everyone else — finance, auditing, legal, compliance, middle management, operations. AI, Prince argues, is not coming for builders or sellers. It is coming for measurers.
The vast majority of the people Cloudflare let go were measurers. The company cut middle managers across the organization, trimmed its marketing team, and consolidated back-office finance and operations. In the announcement, Prince noted that Cloudflare's own internal AI usage had grown more than 600% in just three months. Meanwhile, the company has a record number of open positions and just received roughly a million applicants for just a 1,000+ paid summer internships, all of them in builder or seller roles.
The same week, ClickUp founder and CEO Zeb Evans announced a 22% headcount reduction at a company he described as "the strongest it's ever been." His post racked up millions of views in hours.
SmarterX founder and CEO Paul Roetzer broke down what both moves signal, and why he thinks the era of vague "AI may affect jobs" speculation is over on Episode 216 of The Artificial Intelligence Show.
20%+ - Cloudflare's workforce cut
30%+ - Cloudflare's revenue growth in the same period
600% - Growth in Cloudflare's internal AI usage in three months
22% - ClickUp's headcount cut while calling the business its strongest ever
~1 million - Applicants for Cloudflare's 1,111 paid summer internships, all builder or seller roles
No More Excuses: AI Is the Reason for CutsFor the last year, most AI-driven layoffs have been hidden behind softer language: restructuring, repositioning, efficiency reviews, return-to-office attrition. Cloudflare and ClickUp just removed the euphemism.
The "pandemic over-hiring" excuse is done. "The people who are stuck on this 'we're just solving for over-hiring during the pandemic' are going to need to find a new talking point," says Roetzer. "Because that is not what any of this is."
Cloudflare didn't make these cuts because the business is struggling. It's growing 30%-plus. ClickUp didn't make them in a downturn. Its CEO called the company stronger than ever. Both leaders explicitly said the cut wasn't about cost. Clickup's Evans said most of the savings will flow back into the people who stay, including new million-dollar salary bands for employees who deliver outsized AI-driven impact. These are healthy companies reorganizing around what they think the next era of work actually looks like.
The new framing is "be AI forward or don't have a job." That's Roetzer's read, and he's been saying a version of it for a while. This week he said it plainly.
"Every company I talk to right now is looking for the AI forward professionals in their current staff, and the ones who aren't won't be there in a year," says Roetzer. "You will not find a company three years from now that isn't using AI because they will be out of business."
AI cuts both ways on the same person. One of the sharpest takes on the Cloudflare and ClickUp news came from Yext founder Howard Lerman, who pointed out that everyone fixates on AI turning a 10x engineer into a 100x engineer, but the inverse is just as real. Said Lerman in an X post: "AI amplifies the negative impacts of poor performers."
Roetzer emphasizes that and adds:
."You are either AI forward or you don't have a job."
—Paul Roetzer, founder and CEO of SmarterX, Episode 216 of The Artificial Intelligence Show
That's the part of the AI productivity story that doesn't get said. The same tools that make great employees more valuable make weak ones more visible.
The honest message inside Prince's op-ed and Evans's announcement is that businesses are going to keep getting rebuilt around AI faster than most workforces are ready for. The "measurers" Drucker described 70 years ago are exactly the roles AI can now do tirelessly, 24 hours a day, with a level of objective detail no human can match. That doesn't mean those people are doomed, but it does mean the old version of those jobs is fading fast.
The pattern for individual professionals is the one Roetzer has been pushing for years: become the person who uses AI to do the measuring, instead of the person who is being measured against it. The pattern for leaders is harder. Cloudflare paired its cuts with a severance package that included full base pay through the end of 2026, extended healthcare, and accelerated equity vesting. ClickUp paired its cuts with million-dollar salary bands for the people who stay. Neither approach makes layoffs feel good. But both lean toward treating AI restructuring as a fundamental reshape of the company, not a quiet quarterly cost cut.
More CEOs will follow Prince's lead and put the AI rationale in writing. Cloudflare's 600% internal usage stat, ClickUp's 22% cut with a viral X post, and Prince's published op-ed all served as templates. Other public-company CEOs are watching, and the next round of restructuring announcements will start naming AI directly instead of dancing around it.
The "100x organization" framing is going to spread fast. Evans's framework — builders, agent managers, front-liners — and the idea of paying outsized traditional salary bands for outsized AI-driven output is the kind of language that gets picked up by other founders in a matter of weeks. Whether or not other companies can afford to do this, the framing of "we're rebuilding the org for AI" is now a CEO talking point with two real templates behind it.
In the opening letter to the 2026 State of AI for Business Report, Roetzer wrote that "the quiet part is being said out loud," which means AI-driven layoffs have moved from off-the-record acknowledgments into public announcements. Cloudflare and ClickUp this past week are the latest evidence. The data behind the letter goes further: 71% of the 2,100-plus professionals surveyed expect AI to eliminate more jobs than it creates over the next three years, while just 20% say they are personally concerned about AI's impact on their own role.
That gap is the part every leader and individual contributor should be paying attention to. The full report breaks down where organizations actually stand on adoption, governance, training, and the workforce equation, with cross-cut analysis by role, function, and company size. Read the full report →