AI ate 1,100 Cloudflare jobs

The pink slips have AI on them. Cloudflare’s 1,100 layoffs — roughly 20% of staff — landed the same day Q1 revenue hit a record $639.8M, up 34% YoY. Cloudflare’s own AI usage jumped more than 600% in three months, and every R&D merge request now gets a first-pass AI review agent. CEO Matthew Prince called the cuts structural, not cost-cutting, and is paying base salaries through end of 2026. Record revenue and mass layoffs just stopped being a contradiction.

Capital is moving the same direction the labor is. Nvidia’s $40B equity push in 2026 funnels $30B into a single OpenAI deal, up to $3.2B into Corning, and up to $2.1B into IREN, on top of dozens of venture rounds layered on 67 from 2025. Analyst Matthew Bryson flagged the circular-investment problem out loud, and one customer absorbing roughly three-quarters of Nvidia’s strategic equity makes it harder to ignore. The financier’s book and the customer book are now the same book.

Policy is racing to catch up. The Trump-Xi AI talks on May 14-15 in Beijing would be the first AI-specific US-China engagement under this administration, with Treasury Secretary Scott Bessent leading the US side and Beijing yet to name its counterpart. The proposed agenda covers erratic model behavior, autonomous military systems, and AI attacks by non-state actors — the next step beyond the Biden-era 2024 Geneva dialogue, which produced limited results. Six days out, two governments are trying to write rules for a labor and capital reshuffle already underway.