Jack Dorsey cuts 4,000 jobs at Block, citing AI tools that 'can do more and do it better'

Jack Dorsey's Block cuts nearly half of its staff in AI gamble

Jack Dorsey's Block, the financial tech company that runs Square and the Cash app, is cutting its workforce by "nearly half" and axing more than 4,000 jobs. The company will shrink from more than 10,000 people to less than 6,000, Dorsey says in a post on X. And the reason why? AI. "We're not making this decision because we're in trouble," Dorsey says. "Our business is strong. Gross profit continues to grow, we continue to serve more and more customers, and profitability is improving. But something has changed. We're already seeing that the intelligence tools we're creating and using, paired with smaller and flatter teams, are enabling a new way of working which fundamentally changes what it means to build and run a company. And that's accelerating rapidly."

Block ditches 4,000 staff, because AI can do their jobs

One massive round of firings is apparently better for morale than a drip-drip-drip of death Twitter co-founder Jack Dorsey's financial services company Block has announced it will fire 40 percent of staff - around 4,000 people - because new "intelligence tools" the company is implementing "can do more and do it better." The company announced the sackings in the shareholder letter [PDF] accompanying its Q4 earnings announcement on Thursday. The payments and crypto company reported quarterly revenue of about $6.25 billion - up 3.6 percent year-over-year - and gross profit of around $2.9 billion. The company made $1 billion of gross profit in December 2025 alone. Full-year revenue came in at about $24.2 billion, and gross profit was around $10.36 billion. I believe the majority of companies will reach the same conclusion and make similar changes "2025 was a strong year for us," Dorsey wrote in the shareholder letter, before posing the question, "Why are we changing how we operate going forward?" His answer, spread across the letter and a Xeet, is that AI has already changed the way Block works, so it needs to change its structure. "We're already seeing that the intelligence tools we're creating and using, paired with smaller and flatter teams, are enabling a new way of working which fundamentally changes what it means to build and run a company. and that's accelerating rapidly," he wrote on X. In the shareholder letter, he wrote, "Intelligence tools have changed what it means to build and run a company. We're already seeing it internally. A significantly smaller team, using the tools we're building, can do more and do it better. And intelligence tool capabilities are compounding faster every week." On X, Dorsey said he could have cut jobs "gradually over months or years as this shift plays out, or be honest about where we are and act on it now." He decided to let 4,000 people go all at once because "repeated rounds of cuts are destructive to morale, to focus, and to the trust that customers and shareholders place in our ability to lead." "I'd rather take a hard, clear action now and build from a position we believe in than manage a slow reduction of people toward the same outcome," he wrote, adding his view that "A smaller company also gives us the space to grow our business the right way, on our own terms, instead of constantly reacting to market pressures." Whether Dorsey is blaming AI or not, Block has not served its shareholders well under his leadership over the last five years, with its stock down around 80% from its 2021 peak. But investors liked what they heard on Thursday, as Block's share price jumped about 23 percent in after-hours trading. "To those staying ... I made this decision, and I'll own it," Dorsey wrote on X. "What I'm asking of you is to build with me. We're going to build this company with intelligence at the core of everything we do." He added that Block's actions and new direction will help its customers to navigate change by creating "a future where they can build their own features directly, composed of our capabilities and served through our interfaces." "That's what I'm focused on now," he wrote. "Expect a note from me tomorrow." Before then, Dorsey will host "a live video session to thank everyone," including the approximately 4,000 people losing their livelihoods in a sluggish economy. "I know doing it this way might feel awkward," he wrote. "I'd rather it feel awkward and human than efficient and cold." Because firing 4,000 people so machines can take their jobs would never come across as cold. Dorsey thinks Block won't be the last company to change its operations to meet the AI moment. "I don't think we're early to this realization," he wrote. "I think most companies are late." "Within the next year, I believe the majority of companies will reach the same conclusion and make similar structural changes. I'd rather get there honestly and on our own terms than be forced into it reactively." ®

Block shares soar as Dorsey leans on AI to trim workforce

Feb 27 (Reuters) - Block (XYZ.N), opens new tab shares soared more than 20% in premarket trading on Friday after it announced it would nearly halve its workforce as part of an overhaul to embed artificial intelligence tools across its operations. The layoffs are the most visible signs of how the U.S. fintech industry is navigating the impact of AI, with its CEO, tech billionaire Jack Dorsey, warning that most companies were "late" to realize the emerging technology's potential. "At its core, it's about how some companies may be run going forward - not just doomsday headcount reductions, but also enabling higher ROI investments in growth and FCF," analysts at Evercore ISI wrote, referring to free cash flow. Accelerating AI adoption is helping companies to cut jobs in divisions most exposed to automation. Economists at Goldman Sachs have estimated that AI was responsible for job losses amounting to a 5,000 to 10,000 hit to average monthly job growth in the industries most exposed to it in 2025. Block was one of the companies that aggressively hired during the pandemic as the use of digital payments and online commerce spiked. "In Block's case, this looks like a mix of AI efficiency gains and an overdue clean-up of corporate bloat," said Matt Britzman, an analyst at Hargreaves Lansdown. Its workforce jumped from about 3,800 employees in 2019 to more than 10,000 in 2025 as Block battled increasing pressures from rising competition in its payments and buy-now-pay-later segments. "While the RIF (reduction in force) is large, it does bring Block's headcount back toward pandemic-era levels, making it a standout in gross profit per employee, well ahead of its peers including Visa," JPMorgan analysts said. Reporting by Utkarsh Shetti and Manya Saini in Bengaluru; Editing by Sriraj Kalluvila Our Standards: The Thomson Reuters Trust Principles., opens new tab

Opinion: Block's layoffs might just be the biggest story of a tumultuous week. Here's why

Jack Dorsey, co-founder and chief executive officer of Twitter Inc. and Square Inc., speaks during the Bitcoin 2021 conference in Miami, Florida, U.S., on Friday, June 4, 2021. In a week where the News Gods have given us a cornucopia of stories, it's a fool's game to pick out the biggest one. Was it Trump's extraordinary State of The Union? The phenomenal Nvidia results that failed to answer questions over whether the enormous hyperscaler splurge will result in significant profits further down the line? The rising tensions between Iran and the U.S.? Let me play the fool for a moment, because I think the news from a medium-sized tech payments company might have longer term tremors and be a warning of societal upheaval far greater than other stories of the week. Block, a $33 billion company, surged in extended trading on Thursday after cofounder and CEO Jack Dorsey, best known for cofounding Twitter, told the market he is laying off nearly half his workforce. He wrote to shareholders than 4,000 of the 10,000 were "being asked to leave or entering into consultation" to leave. Again: That is nearly half his workforce! Block CFO Amrita Ahuja said the job cuts would position the company "for our next phase of long term growth." "We are choosing to shift how we operate at a time when our business is accelerating and we see an opportunity to move faster with smaller, highly talented teams using AI to automate more work," Ahuja wrote. Job cuts happen all the time, but what Dorsey had to say should be a wake-up call for everyone. He said he expects other companies to similarly overhaul their workforces as they see more efficiency gains from "intelligence tools." Let that sink in: Dorsey expects other companies to similarly overhaul their workforces as they see more efficiency gains from "intelligence tools." "Within the next year, I believe the majority of companies will reach the same conclusion and make similar structural changes," he wrote. Do the math: 10,000 jobs to just under 6,000 replicated across industries across the nation, across the world. So a new, growth company, not an old economy business, has just said companies will cut huge swathes of their workforces as new intelligence tools become diffuse. I keep getting told on CNBC that AI will create new jobs to replace those being lost. I've been asking the same question for years now. "What are those jobs? Where are the mass of jobs for the millions whose roles are set to be made redundant?" And I hear the same old trope every time - "oh those jobs haven't been created yet."

Fintech company Block lays off 4,000 of its 10,000 staff, citing gains from AI

BANGKOK (AP) -- Shares in the financial technology company Block have soared more than 20% in after-hours trading after its CEO announced it was laying off more than 4,000 of its 10,000 some employees due to its use of artificial intelligence. "The core thesis is simple. Intelligence tools have changed what it means to build and run a company," Jack Dorsey said in a letter to shareholders in Block, the parent company to Square and CashApp. "A significantly smaller team, using the tools we're building, can do more and do it better," he said. Dorsey's comments explicitly naming AI as a key driver behind the move were also posted on X, or Twitter, a company he co-founded. Their assertion that the job cuts will add to Block's profitability and efficiency led investors to jump in and buy, analysts said. Block's shares gained 5% Thursday to $54.53, before it reported its earnings. They shot up to nearly $69 in after-hours trading. The mobile payments services provider reported its fourth quarter gross profit jumped 24% from a year earlier. Layoffs by American companies remain at relatively healthy levels, but the job cuts at Block are the latest among thousands announced in recent months.

Block, the parent of Square and Cash App, is laying off over 4,000 people

Block is the latest business to announce layoffs, with the operator of payment platforms Square and Cash App opting to cut jobs in favor of using more AI tools. The financial tech company, helmed by Twitter founder Jack Dorsey, is slashing its current staff of 10,000 to "just under 6,000." CNBC highlighted a letter Block sent to shareholders announcing the decision to nearly halve its workforce. According to the message from Dorsey: "The core thesis is simple. Intelligence tools have changed what it means to build and run a company. We're already seeing it internally. A significantly smaller team, using the tools we're building, can do more and do it better. And intelligence tool capabilities are compounding faster every week." We learned last year that Block had developed an AI agent called "codename goose" for interacting with LLMs. Leadership is clearly putting high expectations on that project and any other in-house tools to fill the shoes of thousands. "intelligence will be at the core of how the entire company works. How we make decisions, how we build trust and manage risk, how we build products, and how we serve customers," the shareholder letter states. Block also reported its latest financial results today. It finished the 2025 financial year with operating income (profit after expenses) of $1.71 billion. This isn't the first time the fintech company has made deep cuts in its employee count. Layoffs numbering about 1,000 were rumored both in 2024 and 2025.

Jack Dorsey's Block cuts thousands of roles as it embraces AI

Twitter co-founder Jack Dorsey says his technology firm Block is laying off almost half its workforce because artificial intelligence (AI) "fundamentally changes what it means to build and run a company." "Intelligence tools we're creating and using, paired with smaller and flatter teams, are enabling a new way of working," he wrote in a note to staff. The layoffs will mean the headcount at the company - which owns Square, CashApp and Tidal - will fall to less than 6,000 from 10,000. Block has seen several rounds of layoffs since 2024 but this is the first time it has cited AI as the reason for redundancies and marks the latest in a series of major job cuts in the tech industry. At the end of January Amazon laid off 16,000 employees, having already cut 14,000 roles a few months earlier. In a subsequent call discussing financial results, Brian Olsavsky, Amazon's chief financial officer, said the company was looking at cost reductions elsewhere as it ramps up AI spending. Meta, Microsoft and Google have also laid off workers as their focus has shifted to huge investments in AI. Mark Zuckerberg, Meta's co-founder and chief executive, said he is expecting "2026 to be the year that AI dramatically changes the way we work." "We're starting to see projects that used to take big teams now be accomplished by a single, very talented person," Zuckerberg said. Most tech companies today are using AI tools that automatically write the computer code required to operate software or websites, like Claude Code from Anthropic or Codex from OpenAI. Such automation of what has for decades been work done by highly trained people has led to fears that AI will overturn the job market. But some analysts have suggested the immediate threat to jobs has been exaggerated by executives who want to appear ahead of the curve. According to Dorsey, only more change related to AI capabilities is on the way. "I don't think we're early to this realisation," he said Thursday. "I think most companies are late". Block's financial report showed strong demand for its products and services, pushing up profits at the end of last year. The firm also said it will incur up to $500m (£370m) in restructuring costs as it pivots to the new strategy. Its shares rose by more than 20% in extended trading after the announcement. Dorsey is a co-founder and former chief executive of Twitter, the online micro-messaging platform that was later bought by Elon Musk and renamed X.

Jack Dorsey's Block to cut over 4,000 jobs as AI use expands, shares surge

Feb 26 (Reuters) - Block (XYZ.N), opens new tab on Thursday said it will cut over 4,000 jobs, or nearly half its workforce, as advances in AI reshape how it builds and runs its business, sending its shares up 22% in after-hours trading. The layoffs underscore how the AI boom is translating from hype into workforce changes, fueling long-held concerns among workers and economists that the technology could eliminate roles even as it boosts productivity and profits. "Intelligence tools have changed what it means to build and run a company. We're already seeing it internally. A significantly smaller team, using the tools can do more and do it better," CEO Jack Dorsey said in a statement. "I don't think we're early to this realization. I think most companies are late," he added. In a post on social media platform X, Dorsey said Block opted for a single deep round of cuts instead of multiple smaller layoffs over time. He said a smaller company would also give it space to grow the business the right way, instead of constantly reacting to market pressures. Investors have been rewarding companies that show AI-driven cost savings, and the sharp workforce reduction signals the scale at which the technology is starting to translate into lower expenses and higher margins in some industries. The company said it expects to incur roughly $450 million to $500 million in restructuring charges. Block posted an adjusted profit of 65 cents per share in the three months ended December 31, compared with 47 cents a year earlier. Gross profit grew 24% in the quarter, driven by a 33% surge in the Cash App business, which enables peer-to-peer mobile payments. Reporting by Manya Saini in Bengaluru; Editing by Tasim Zahid Our Standards: The Thomson Reuters Trust Principles., opens new tab

Dorsey's radical workforce reset may embolden CEOs

Block's Jack Dorsey did just that Thursday, and Wall Street's standing ovation gives other CEOs permission, or even an incentive, to consider the same thing. What he's saying: Dorsey, an iconoclast who co-founded and once led Twitter, was blunt in announcing via X that Block will say goodbye to 40% of its 10,000-person workforce: * "Something has changed. We're already seeing that the intelligence tools we're creating and using, paired with smaller and flatter teams, are enabling a new way of working which fundamentally changes what it means to build and run a company," he wrote. * "I had two options: cut gradually over months or years as this shift plays out, or be honest about where we are and act on it now. i chose the latter." Zoom in: The fintech's stock rallied as much as 25% on the news, after having been down more than 16% over the past year and 76% over the past five years. * Block's declining stock price put Dorsey under pressure to make changes, although he denied that the layoffs were related to Block's financial performance. The big picture: Wall Street was recently captivated by a viral doomsday report predicting AI would wipe out jobs, although stated reasons for most other AI-related layoffs so far have been much less explicit than what Dorsey did. * Many AI executives and investors insist that the tech will lead to temporary labor dislocations rather than net job loss, echoing the industrial revolution. The bottom line: It's one thing to replace people with machines. It's quite another to prove that it makes business sense.

Jack Dorsey's Block lays off nearly half of workforce due to AI

Jack Dorsey's Block, a fintech company that owns Square and Cash App, is laying off nearly half of its workforce. Dorsey announced the layoffs on X, citing AI as the main reason behind the move. "Today we're making one of the hardest decisions in the history of our company: we're reducing our organization by nearly half, from over 10,000 people to just under 6,000," he wrote. This Tweet is currently unavailable. It might be loading or has been removed. The layoffs come after a strong quarter for Block, with revenue, profit, and customer base all growing. But Dorsey appears to think that the rise of AI makes this move inevitable, presenting the decision as a choice between doing one sharp cut now, or laying people off slowly over a longer period of time. "I'd rather take a hard, clear action now and build from a position we believe in than manage a slow reduction of people toward the same outcome," he wrote. Employees that are being laid off will get their salary for 20 weeks plus one week per year of tenure, six months of health care, and $5,000 in cash, among other benefits. But how hard will it be for them to find another job? Dorsey's reasoning echoes the sentiment recently shared by several tech leaders, with Anthropic's Boris Cherny claiming that "coding is largely solved" and Elon Musk saying that AI will "replace all jobs." A widely shared "thought exercise" by Citrini recently predicted an economic collapse by 2028 due to AI driving humans out of work. "Something has changed," wrote Dorsey. "We're already seeing that the intelligence tools we're creating and using, paired with smaller and flatter teams, are enabling a new way of working which fundamentally changes what it means to build and run a company. and that's accelerating rapidly." The market reacted positively to the news, with Block's shares rising by nearly 30 percent in extended trading following the announcement.

Jack Dorsey's Block cuts 40% of staff, 4,000+ people -- and yes, it's because of AI efficiencies

Former Twitter co-founder Jack Dorsey's new company Block -- the parent of merchants payment system Square, mobile peer-to-peer payments Cash App, music streamer Tidal, and open source AI agentic system Goose -- is sending shockwaves across the business world tonight after announcing a more than 40% headcount, cutting its workforce by more than 4,000 people out of a prior total of 10,000, despite its latest quarterly earnings statement released today showing $2.87 billion in gross profit up 24% year-over-year. The culprit? Newfound AI efficiencies. As Dorsey put it in a note shared on his own former social network, X: "we're not making this decision because we're in trouble. our business is strong. gross profit continues to grow, we continue to serve more and more customers, and profitability is improving. but something has changed. we're already seeing that the intelligence tools we're creating and using, paired with smaller and flatter teams, are enabling a new way of working which fundamentally changes what it means to build and run a company. and that's accelerating rapidly. i had two options: cut gradually over months or years as this shift plays out, or be honest about where we are and act on it now. i chose the latter. repeated rounds of cuts are destructive to morale, to focus, and to the trust that customers and shareholders place in our ability to lead. i'd rather take a hard, clear action now and build from a position we believe in than manage a slow reduction of people toward the same outcome. a smaller company also gives us the space to grow our business the right way, on our own terms, instead of constantly reacting to market pressures." The core of this reorganization is a pivot toward an "intelligence-native" model. Dorsey argues that a significantly smaller team, leveraging the very tools they are building, can deliver more value than a traditional large-scale organization. Block is re-engineering its entire operational stack to be orchestrated by AI, moving away from human-intensive management hierarchies toward what it calls "agentic AI infrastructure". This includes four primary focus areas: The financial strength cited in the lede is driven by deep engagement in Cash App and Square. Cash App's gross profit grew 33% YoY to $1.83 billion, while Square saw its strongest year on record for new volume added (NVA). Specific product highlights include: Block also exceeded the Rule of 40 -- the industry benchmark where the sum of gross profit growth and adjusted operating income margin exceeds 40% -- for the first time in the fourth quarter. Not everyone was convinced by Dorsey's letter stating that AI efficiencies were the primary driver of the layoffs. As Will Slaughter wrote on X: "In 3 years from December 2019 to December 2022, Block $XYZ more than tripled its headcount from 3,900 to 12,500. Unwinding less than half an insane COVID overhiring binge has much more to do with Jack Dorsey's managerial incompetence than whether AI is going to take your job." Entrepreneur Marcelo P. Lima offered a similar sentiment on X, writing in part: "Everyone will assume Jack Dorsey 'greatest of all time' is doing this because of AI. He's not. Block has been massively bloated for years. Don't forget, Jack was head of Twitter. When Elon took over, he fired 80% of staff within 5 months and the product got better. This was before generative AI and Claude Code." And yet, regardless of how heavily AI factored into these layoffs in particular, the outcome on the wider enterprise landscape may ultimately be the same. With Block's stock price rising more than 24% on the news, the boards and leadership of other public companies will likely be forced to at least entertain the idea of similarly drastic cuts if they believe AI can replace human labor and drive greater organizational efficiencies. As user @khuppy wrote on X: "By Q2, if you aren't firing lots of employees, your board will fire you for being a dinosaur who doesn't implement AI. It's going to happen fast now. Feudalism, here we come..." Clearly, companies across sectors but especially those in tech and services will be re-examining their headcount in light of Block's latest move. Despite the robust financial performance, the human cost is stark. The reduction from over 10,000 to just under 6,000 employees is one of the most drastic in fintech history. Dorsey's internal note, while aimed at transparency, was met with a mix of awe at the technical vision and criticism of the timing. Affected employees are receiving a severance package that includes 20 weeks of salary plus one week per year of tenure, equity vesting through May, and a $5,000 transition fund. Dorsey noted that communication channels would stay open through Thursday evening so the team could say goodbye properly, stating, "i'd rather it feel awkward and human than efficient and cold." For enterprise decision-makers, Block's move represents a fundamental challenge to the "growth at all costs" hiring model that has defined the last decade of tech. Leadership teams should view this not merely as a cost-cutting measure, but as a strategic reset where organizational value is measured by the ratio of output to "intelligence-native" tools rather than total headcount. Executives should begin by auditing their own internal workflows to identify where agentic AI can consolidate roles and flatten management hierarchies before market pressures force a more reactive, less orderly contraction. Even if not leading to as drastic of cuts, hiring slowdowns and freezes, Block's move should likely prompt at least the kind of policy introduced separately by Shopify CEO Tobi Lutke nearly a year ago: "Before asking for more Headcount and resources, teams most demonstrate why they cannot get what they want done using AI." While the community reaction to Block's layoffs highlights the potential for brand damage and morale loss, the 24% surge in Block's stock price suggests that the public market is increasingly rewarding lean, automated efficiency over human-intensive scaling. Decision-makers should evaluate their current "bloat" against the benchmark set by Dorsey: if a company of 6,000 can drive $12.20 billion in gross profit, the standard for organizational efficiency has been permanently raised.

Jack Dorsey lays off 40% of Block, saying AI has changed the game: 'Intelligence tools have changed what it means to build and run a company' | Fortune

Shares in the financial technology company Block soared more than 20% in premarket trading Friday after its CEO announced it was laying off more than 4,000 of its 10,000 plus employees, reconfiguring to capitalize on its use of artificial intelligence. "The core thesis is simple. Intelligence tools have changed what it means to build and run a company," Jack Dorsey said in a letter to shareholders in Block, the parent company to online payment platforms such as Square and Cash App. "A significantly smaller team, using the tools we're building, can do more and do it better," he said. Dorsey's comments explicitly naming AI as a key driver behind the move were also posted on X, or Twitter, a company he co-founded. The assertion that the job cuts will add to Block's profitability and efficiency led investors to jump in and buy, analysts said. Block's shares gained 5% Thursday to $54.53, before it reported its earnings. They shot up to nearly $69 in after-hours trading. The mobile payments services provider reported its fourth quarter gross profit jumped 24% from a year earlier. "For years, we have debated whether AI would dent jobs at the margin. Now we have a public case study in which the CEO explicitly says that intelligence tools have changed what it means to build and run a company," Stephen Innes of SPI Asset Management said in a commentary. "Other large employers have announced tens of thousands of cuts in recent months. Some have downplayed the AI link. Block did not," he said. A global technology company founded in 2009, San Francisco-based Block operates in the United States, Canada, parts of Europe, Australia and Japan. In a post on Twitter, Dorsey outlined various ways the company will support those laid off. For employees overseas, the terms might differ, he said. It was unclear which employees would be laid off where. Layoffs by American companies remain at relatively healthy levels, but the job cuts at Block are the latest among thousands announced in recent months.

Jack Dorsey's Block cuts 50% of jobs as it embraces AI and shares jump

Block CEO Jack Dorsey has announced a radical restructuring that will see nearly half of the company's workforce made redundant. Shares surged by 23.5% in after-hours trading. In a move that has sent shockwaves through the fintech sector, Jack Dorsey, the co-founder and CEO of the fintech conglomerate Block, formerly known as Square, has unveiled the most aggressive corporate downsizing in the company's history. Block Inc. comprises several major fintech brands, namely the mobile payment service Cash App, which is widely used in the US. In a detailed note to the company, shared via X, Dorsey confirmed that the organisation will reduce its headcount by approximately 50%, representing almost 4,000 jobs. According to the CEO, the decision is not a sign of financial distress but rather a strategic evolution aimed at "re-centring" the company around a more efficient, AI-driven model. The news had an immediate and profound impact on Wall Street. Block's share price, under the ticker $XYZ, surged by 23.5% in after-hours trading as investors reacted with overwhelming optimism to the prospect of leaner operations. This shift reflects a broader trend within the tech and finance industries, where companies are increasingly using AI to "do more with less". However, the scale of Block's cuts is particularly striking. While many firms have implemented 5 or 10% reductions, Dorsey's decision to axe nearly half the workforce signals a total commitment to a new and automated era of corporate management. The central pillar of Dorsey's new strategy is the integration of generative AI and other automated systems into the core of Block's workflow. According to the note sent to employees, the former Twitter CEO believes that the rapid advancement of AI tools has rendered large, multi-layered corporate structures obsolete. Dorsey argued that "smaller and smarter" teams can now achieve outcomes that previously required hundreds of personnel. "We no longer need the mass of people we once did to maintain our velocity," the Block CEO wrote in the memo highlighting that AI-assisted coding and compliance systems, as well as automated customer support, have significantly reduced the man-hours required to run a global financial platform. By leveraging these technologies, Block intends to maintain its current product output while drastically reducing its overhead costs. Analysts suggest that this could save the company billions of dollars annually, with some estimates putting the potential savings already at $1.2bn (€1bn) this fiscal year. For a company that has long been at the forefront of digital payments and crypto, this AI pivot represents a significant departure from traditional scaling methods. The sheer scale of the layoffs raises the notion that we are perhaps entering the accelerated stage of AI driving people out of work. It is still early days in 2026 and companies are seemingly starting to make substantial restructurings instead of just small and strategic firings. The socio-economic shocks of the AI revolution now appear to be materialising in a very concerning and real way.

Jack Dorsey's Block cuts 4,000 citing AI as the cause

Block opened a new strategic European hub in Dublin late last month. Block is cutting 4,000 jobs - or around 40pc of its global workforce - as, according to company co-founder and chair Jack Dorsey, AI tools and flatter teams are proving more productive. In a lengthy post on X, Dorsey stated that he made the decision to cut jobs after realising how small teams and intelligence tools have enabled a "new way of working" that "fundamentally changes" things. He maintained that the job cuts were not a cost saving measure. "Our business is strong. Gross profit continues to grow...and profitability is improving", he added. He also doubled down on his decision in a letter to the shareholders, stating that a "majority" of companies will reach similar conclusions around smaller teams and make similar structural changes within the next year. As pointed out by major publications, Block has conducted several rounds of layoffs in recent years, but it has never cited AI as a reason for the redundancies before. The company previously laid off Irish employees in 2024 as part of its then plans to cut around 1,000 people across the company globally. The layoffs come after the global fintech giant opened a new Dublin office late last month where it plans to situate 300 of its workers. SiliconRepublic.com has asked Block what impact the layoffs would have on its Irish employees. Block shares rose by more than 24pc following the announcement, which came alongside a pleasant Q4 report boasting a 24pc year-over-year growth in gross profit, marked by a 51pc growth in financial solutions and a 10pc growth in bitcoin ecosystem. As of 2025, Block had 10,205 full-time employees globally, with 2,472 of them working from outside the US. According to Block's US government filings, the layoffs will be completed by the end of Q2 and will cost the company anywhere between $450m and $500m. Block, formerly known as Square until 2021, is the operator behind popular fintech services, including the consumer-focused Cash App and seller-focused Square. Just last month, Amazon announced that it is cutting 16,000 roles across its departments internationally to, according to the company, reduce organisational layers and remove bureaucracy. The company employs more than 6,000 across various sites in Dublin, Cork and Drogheda. RTÉ reported that around 300 Ireland-based jobs would be at risk. Don't miss out on the knowledge you need to succeed. Sign up for the Daily Brief, Silicon Republic's digest of need-to-know sci-tech news. Jack Dorsey, 2018. Image: © Mark Warner via Flickr (CC BY 2.0)

Block rallies after Dorsey slashes 40% of workforce in AI-native reset as earnings top estimates - SiliconANGLE

Block rallies after Dorsey slashes 40% of workforce in AI-native reset as earnings top estimates Shares in Block Inc. surged more than 23% in late trading today after the financial services company announced that it was laying off more than 4,000 people from its approximately 10,000-strong workforce alongside an earnings beat in its fiscal 2025 fourth quarter. For the quarter that ended on Dec. 31, Block reported adjusted earnings per share of 65 cents, up from 47 cents in the same quarter of 2024, on revenue of $6.25 billion, up 3.6% year-over-year. The earnings figure came in ahead of the 64 cents per share expected by analysts, while Block's revenue fell short of an expected $6.29 billion. Block saw growth in two of its three revenue segments, with commerce enablement revenue coming in at $3.05 billion, up 11.1% year-over-year and financial solutions revenue growing 47.9% year-over-year to $1.222 billion. Conversely, the company's bitcoin ecosystem saw revenue decline 19.6% year-over-year to $1.98 billion amid a bear market for cryptocurrencies. The company's gross profit was up 24% year-over-year to $2.87 billion, boosted by a 33% increase in Cash App revenue driven by higher user engagement and conversion and a 12% year-over-year increase in Square gross payment volume. The specific figures were definitely not what investors were paying attention to, however, with Block Chief Executive Officer Jack Dorsey starting the company's Q4 2025 Shareholder Letter with the news of the layoffs. The layoffs are described as a restructuring designed to better align Block's organization with its operating model and long-term strategy, with Dorsey saying the company is reshaping itself around smaller, more focused teams intended to move faster and execute more efficiently, particularly as artificial intelligence becomes more embedded in its product development process. The cuts are framed as a deliberate effort to raise performance standards and reduce organizational complexity. The shareholder letter emphasizes that Block wants to flatten its structure, clarify accountability and concentrate resources around its highest-priority initiatives across Square, Cash App and its broader ecosystem. Dorsey also characterized the move as one focused on making Block a leaner, AI-native organization and that automation and improved tooling allow the company to operate effectively with fewer people. "The core thesis is simple. Intelligence tools have changed what it means to build and run a company. We're already seeing it internally," said Dorsey. "A significantly smaller team, using the tools we're building, can do more and do it better. And intelligence tool capabilities are compounding faster every week." For its fiscal year 2026, Block is forecasting gross profit of $12.2 billion and adjusted earnings per share of $3.66. The latter figure came in ahead of the $3.22 expected by analysts.

Fintech company Block lays off 4,000 of its 10,000 staff, citing gains from AI

BANGKOK (AP) -- Shares in the financial technology company Block have soared more than 20% in after-hours trading after its CEO announced it was laying off more than 4,000 of its 10,000 some employees due to its use of artificial intelligence. "The core thesis is simple. Intelligence tools have changed what it means to build and run a company," Jack Dorsey said in a letter to shareholders in Block, the parent company to Square and CashApp. "A significantly smaller team, using the tools we're building, can do more and do it better," he said. Dorsey's comments explicitly naming AI as a key driver behind the move were also posted on X, or Twitter, a company he co-founded. Their assertion that the job cuts will add to Block's profitability and efficiency led investors to jump in and buy, analysts said. Block's shares gained 5% Thursday to $54.53, before it reported its earnings. They shot up to nearly $69 in after-hours trading. The mobile payments services provider reported its fourth quarter gross profit jumped 24% from a year earlier. Layoffs by American companies remain at relatively healthy levels, but the job cuts at Block are the latest among thousands announced in recent months. Apart from Block, a number of other high-profile companies have announced layoffs recently, including UPS, Amazon, Dow and the Washington Post.

Jack Dorsey's Block Announces 4,000 Job Cuts in AI Overhaul

Bloomberg reported earlier this month that 10% of Block's workforce could be cut during annual performance reviews as part of a broader overhaul. Jack Dorsey's payments company Block will cut over 4,000 of its staff, with its co-founder pinning the move on the rapid acceleration of AI. "We're already seeing that the intelligence tools we're creating and using, paired with smaller and flatter teams, are enabling a new way of working which fundamentally changes what it means to build and run a company, and that's accelerating rapidly," wrote Dorsey in a letter to the company, which he shared on X. "I had two options: cut gradually over months or years as this shift plays out, or be honest about where we are and act on it now. I chose the latter. Repeated rounds of cuts are destructive to morale, to focus, and to the trust that customers and shareholders place in our ability to lead," he added. Affected staff will still receive their salary for 20 weeks, plus one week per year of tenure, six months of health care, their corporate devices, and $5,000 to help them transition to a new role, said Dorsey. Bloomberg reported earlier this month that 10% of Block's workforce could be eliminated during annual performance reviews, as part of a wider restructuring effort.

Wall Street Is Cheering AI-Driven Layoffs

Want more stock market and economic analysis from Phil Rosen directly in your inbox? Subscribe to Opening Bell Daily's newsletter. Wall Street is excited for Block to move forward with fewer humans and more AI. The Jack Dorsey-led company announced it will cut more than 4,000 employees, or about half its workforce, and investors aggressively piled into the stock on the news. While Block did report solid earnings, the stock soared more than 24 percent after hours largely on account of its restructuring. In an internal memo Dorsey released publicly, he called out "intelligence tools" and "smaller and flatter teams." The layoffs, he said, are the result of him choosing decisive action over gradual attrition. "A decision at this scale carries risk," Dorsey said. "But so does standing still."

Fintech Company Block Lays off 4,000 of Its 10,000 Staff, Citing Gains From AI

BANGKOK (AP) -- Shares in the financial technology company Block have soared more than 20% in after-hours trading after its CEO announced it was laying off more than 4,000 of its 10,000 some employees due to its use of artificial intelligence. "The core thesis is simple. Intelligence tools have changed what it means to build and run a company," Jack Dorsey said in a letter to shareholders in Block, the parent company to Square and CashApp. "A significantly smaller team, using the tools we're building, can do more and do it better," he said. Dorsey's comments explicitly naming AI as a key driver behind the move were also posted on X, or Twitter, a company he co-founded. Their assertion that the job cuts will add to Block's profitability and efficiency led investors to jump in and buy, analysts said. Block's shares gained 5% Thursday to $54.53, before it reported its earnings. They shot up to nearly $69 in after-hours trading. The mobile payments services provider reported its fourth quarter gross profit jumped 24% from a year earlier. Layoffs by American companies remain at relatively healthy levels, but the job cuts at Block are the latest among thousands announced in recent months. Apart from Block, a number of other high-profile companies have announced layoffs recently, including UPS, Amazon, Dow and the Washington Post.

Jack Dorsey sounds layoff alarm after Block slashes 50% staff -- which companies could be next?

Tech layoffs 2026: For thousands of white-collar workers, the future suddenly feels less certain. Jack Dorsey announced that Block, the parent company of Square and Cash App, will cut nearly half of its workforce, reducing its headcount from more than 10,000 employees to just under 6,000. That means more than 4,000 people are losing their jobs, even as Dorsey says the business itself is strong and profits are growing. In a post on X, Dorsey explained that he chose one sweeping round of layoffs rather than multiple smaller cuts over time. Repeated layoffs, he wrote, are "destructive to morale," focus, and trust among customers and shareholders. Instead of stretching the uncertainty over months or years, he said he would rather take "a hard, clear action now" and rebuild from there. The severance packages are described as relatively generous. Affected employees will receive 20 weeks of base pay, plus an additional week for each year they worked at the company, as per a Business Insider report. Their equity will continue vesting through the end of May, they will receive six months of health coverage, be allowed to keep their corporate devices, and get a $5,000 payment. The scale of the cuts stands out in an industry that has often relied on repeated rounds of layoffs. Management experts say those staggered reductions can create "layoff fatigue and chronic anxiety," hurting morale and productivity, as per the Business Insider report. Dorsey framed the decision as part of a broader shift driven by artificial intelligence. He said intelligence tools, combined with smaller and flatter teams, are enabling "a new way of working" that changes what it means to build and run a company. On Block's earnings call, he predicted that within the next year, most companies will reach the same conclusion and make similar structural changes. The announcement comes at a time when fears about AI and white-collar job losses are already rising. A recent scenario from Citrini Research warned that AI could sharply increase unemployment, unsettling investors and circulating widely on social media. Though described as a scenario rather than a prediction, it gained renewed attention after Block's layoffs. Other tech leaders have voiced similar concerns. Dario Amodei has warned of a looming white-collar "bloodbath," and Mark Zuckerberg has said AI is reshaping what individual employees can accomplish. At Klarna, CEO Sebastian Siemiatkowski said the company's workforce has already halved and is expected to shrink further by 2030. Other companies, including Pinterest, CrowdStrike, Chegg, Salesforce, and Ford Motor Company, have also linked layoffs or workforce changes to AI-driven efficiency. Not everyone agrees that AI alone is to blame. Some observers argue that companies may have overhired during boom times and are now adjusting. Also read: Employee leaves stable Big Four job for startup, regrets it after 3 months -- what people told him Policymakers are paying attention. Federal Reserve Chair Jerome Powell said many companies mention AI when announcing hiring freezes or layoffs, though those effects are not yet clearly visible in jobless claims data, as per a USA Today report. The longer-term outlook remains uncertain. The World Economic Forum estimates that 92 million jobs could be displaced by 2030, but also projects that 170 million new roles could be created in the same period. How many jobs is Block cutting? More than 4,000 roles are being eliminated, reducing the workforce to under 6,000 employees. Are other tech leaders worried about AI and jobs? Yes. Several executives have publicly warned about AI reshaping the workforce.

Balaji Srinivasan Says Block Firings Will Send 'Shockwaves,' Angel Investor Says Jack Dorsey Is Signalling Everyone -- xAI Makes Moves On Talent - Block (NYSE:XYZ)

On Thursday, Elon Musk's xAI began recruiting shortly after Block Inc. (NYSE:XYZ) announced it would cut nearly half its workforce in a sweeping efficiency push tied to artificial intelligence. Block Cuts 4,000 Jobs In AI Efficiency Overhaul Block said it is reducing headcount from more than 10,000 employees to just under 6,000, eliminating over 4,000 roles as part of what CEO Jack Dorsey described as a difficult but necessary restructuring. "Today we shared a difficult decision with our team," Dorsey wrote in a letter to shareholders. The company said affected employees will receive 20 weeks of pay, six months of health coverage and vested equity. Investors Call It A Turning Point For AI And Tech Jobs Following the announcement, Gene Munster, managing partner at Deepwater Asset Management, said the move underscores how quickly AI is reshaping corporate strategy. "AI's impact just hit a new gear," Munster said, adding that the industry remains early in the transition. "We're in the second inning." Silicon Valley investor Balaji Srinivasan characterized the announcement as a signal moment for the tech sector. "This is the first AI cut. And it will send shockwaves," Srinivasan wrote on X. He urged workers to adopt AI tools and boost productivity, warning that companies that fail to adapt risk falling behind competitors embracing automation and agent-driven workflows. "There will be overcorrection. But the fundamental technical innovation is real. And you need to either disrupt yourself or get disrupted," he stated. xAI Signals Hiring Push Amid Layoffs Shortly after the announcement, a talent executive from xAI posted on X, inviting affected Block employees to apply, writing that "X Money is hiring." Musk touted the idea of a cryptocurrency-enabled "everything app" tied to X Money last year, though the company has yet to provide any substantive updates or formal launch details. Price Action: Shares of Block, Inc. surged 23.52% in after-hours trading to $67.36 after climbing 4.99% during the regular session, according to Benzinga Pro. XYZ continues to trade in a negative trend across the short, medium and long term, accompanied by a weak Momentum ranking, according to Benzinga's Edge Stock Rankings. Disclaimer: This content was partially produced with the help of AI tools and was reviewed and published by Benzinga editors. Photo: Sergei Elagin via Shutterstock Market News and Data brought to you by Benzinga APIs To add Benzinga News as your preferred source on Google, click here.

Jack Dorsey fires 4,000 from Block, but shares jump 20%. Does the stock market prefer AI over humans?

Shares of Block jumped over 20% after Jack Dorsey announced strong Q4 profits and plans to cut 4,000 jobs, citing rising AI-driven efficiency. Markets rewarded the structural cost reset, highlighting how investors increasingly favour productivity gains from artificial intelligence over workforce size, despite concerns around social and organisational impact. The parent of Square and Cash App's fourth-quarter gross profit rose 24% year-on-year, reflecting strong demand for its payments products and services. Block expects to incur about $450 million to $500 million in restructuring charges tied to the layoffs. In a letter to shareholders, Chief Executive Jack Dorsey said intelligence tools have changed what it means to build and run a company, adding that a significantly smaller team, using the tools we're building, can do more and do it better. He argued that most companies are late in recognising how AI can reshape operating models. The reaction in the stock market raises a broader question about whether the market does not care about the human cost. Historically, markets are not designed to price social impact directly. Stock prices usually reflect the expected future earnings and cash flows predictability. If investors believe job cuts will structurally lower costs, lift margins and accelerate productivity, especially when paired with strong revenue or profit growth, they typically reward the stock. This is exactly what happened in this case. Investors saw many positives in the announcement that shook the tech world and beyond. First, gross profit growth of high double-digits suggested the core payments business remained resilient. Further, Dorsey signalled that layoffs are a structural cost reset, not a temporary trimming. And finally, the tech world and with it investors are slowly coming to terms that a pivot to AI is inevitable, and the costs, whether it be humans or otherwise, will be there. Dorsey's unusually direct attribution of layoffs to AI may also have sharpened the narrative. Stephen Innes of SPI Asset Management, while speaking to Reuters, described the move as a "public case study" of a CEO stating that intelligence tools have altered what it means to run a company. While many firms have announced layoffs in recent months, few have so openly connected them to AI-driven productivity gains. Also read: Global funds make $2.1 billion comeback on D-Street as earnings outlook improves For investors, cost-cutting is often viewed through the lens of operating leverage. If a company can maintain or grow revenue with a smaller workforce, margins expand. Higher margins increase earnings per share, even after accounting for one-time restructuring charges. In discounted cash flow terms, that improves the present value of future profits. There is also a broader macro narrative at play. Markets are increasingly pricing in a world where AI enhances productivity across sectors. Companies that proactively restructure around AI are often perceived as better positioned than those that delay. That does not mean social consequences are irrelevant. Layoffs can dampen morale, reduce institutional knowledge and carry reputational risk. Over time, if productivity gains fail to materialise or innovation suffers, the market can reverse its view. But in the short term, especially during earnings season, stronger profit growth combined with credible cost discipline tends to dominate investor thinking. Also read: Doomsday or deep value: India's IT stocks at crossroads after 20% crash Block, founded in 2009 and headquartered in San Francisco, operates across the United States, Canada, parts of Europe, Australia and Japan. The company said it will provide support to affected employees, though details vary by geography. (Disclaimer: Recommendations, suggestions, views and opinions given by the experts are their own. These do not represent the views of Economic Times) (You can now subscribe to our ETMarkets WhatsApp channel)

Block Slashes Staff and Eyes AI as Primary Banking Actives Jump 22% to 9.3M | PYMNTS.com

By completing this form, you agree to receive marketing communications from PYMNTS and to the sharing of your information with our sponsor, if applicable, in accordance with our Privacy Policy and Terms and Conditions. As the company culls its workforce from more than 10,000 employees to just under 6,000, Block also used the call to point to accelerating growth in its banking ecosystem, in terms of active users, transactions and Cash App at the center of that ecosystem. Investors cheered the news, sending the stock up 24% in after-hours trading on Thursday. Chief Executive Officer Jack Dorsey framed the move as structural and strategic. "The core thesis is simple. Intelligence tools have changed what it means to build and run a company," he said on the earnings call, adding, "I don't think we're early to this realization. I think that most companies are late." He added that "a significantly smaller team using the tools we're building can do more and do it better. And intelligence tool capabilities are compounding faster every single week." He stated on the call that the company is moving toward an operating model in which intelligence is embedded across product development, risk management and customer interfaces. "Intelligence will be at the core of how the entire company works," Dorsey said. Dorsey said Block has already seen internal gains in productivity. "We've seen engineering work that would have taken weeks to complete be done by a small team in a fraction of the time," he told analysts, pointing to agentic coding tools and improvements in model capabilities. Chief Financial Officer Amrita Ahuja reinforced that message, noting that developer velocity has increased more than 40% since September as AI tools have been adopted across engineering teams. Externally, the intelligence strategy is showing up in Square AI, MoneyBot within Cash App, and what management calls "manager bot" for sellers. In Cash App, more than 70% of actives who used MoneyBot in testing selected a proactive prompt about their finances to get started, according to the shareholder letter that accompanied results. The stated goal is to move from reactive interfaces to proactive intelligence that anticipates user needs across payments, lending and commerce. The restructuring announcement arrived alongside a quarter that exceeded guidance. Block generated $2.87 billion in gross profit in the fourth quarter, up 24% year over year. Adjusted operating income rose 46% to $588 million. Cash App remained the primary growth engine. Monthly transacting actives reached 59 million. Primary Banking Actives, which represent customers who receive direct deposit or meet minimum spending thresholds, grew 22% year over year to 9.3 million in December, up from 8.3 million in September. Management has emphasized that these customers generate nearly 10 times the gross profit of peer-to-peer-only users. Consumer lending expanded sharply. Cash App consumer lending origination volume rose 69% year over year to $18.5 billion in the quarter. Commerce Enablement volume within Cash App reached $54.7 billion, up 17%, while inflows per transacting active increased 12% year over year to $1,410. Square, while growing at a slower pace, showed steady momentum. Gross payment volume increased 10% year over year to $65 billion. Food and beverage sellers were a bright spot, with GPV in that vertical up 16% year over year. Management continues to position Cash App as a banking alternative for what it calls "modern earners." The company estimates an addressable market of approximately 125 million people across independent earners, hourly workers and teens, per the company's letter. Primary banking growth is central to that strategy. Ahuja said the company expects to compound gains in its banking ecosystem while scaling Cash App Green, its status program tailored to customers with multiple income streams. The lending engine, built on what Block calls Cash App Score, integrates repayment history with near real-time inflow and spending data to support underwriting decisions. Management raised its 2026 outlook. Block now expects gross profit of $12.2 billion, reflecting 18% year over year growth. Ahuja said adjusted operating income margins are expected to expand each quarter through the year, with just under 60% of the full-year adjusted operating income forecast to be delivered in the second half. "We're in a place where a lot of what we've been working on is coming together," Dorsey said, adding that he wants Block to be "ahead of the market" in applying intelligence across financial services.

Jack Dorsey Says AI Models' Progress, Push Toward Functionalization Spurred Block's Mega Job Cuts - Stock Surges 23% After-Hours - Block (NYSE:XYZ)

Block, Inc. (NYSE:XYZ) CEO Jack Dorsey said Thursday that advancements in artificial intelligence models and efforts to streamline operations drove the company's choice to lay off nearly half its workforce. Push Toward 'Functionalization During the company's fourth-quarter earnings call, Dorsey was probed about the timing and rationale behind the neary 40% workforce reduction. "We have been working very hard to functionalize the company. That's a big part of what gives us more confidence in making this move," he responded. Dorsey said that Block effectively houses two separate companies -- likely referring to Square and Cash App -- with independent corporate structures, but with a lot of "duplication." "As we functionalized, it allowed us to act more like one company and recognize where there are common capabilities and common foundation, and we're still doing a lot of that work, but I have the confidence that we're in a place that we can move much faster there," the top executive said. AI Opened Up New Possibilities, Says Dorsey Dorsey further pointed out that AI models became "an order of magnitude" more capable and intelligent. This breakthrough, he said, has opened up new possibilities for applying AI to most of the organization, enabling accelerated product delivery. Block Fires 4,000 Employees In 'Hardest Decision' The justification comes after Block reduced its headcount by nearly half, from over 10,000 people to just under 6,000. Dorsey described the decision as one of the "hardest" in the company's history. The affected employees would receive 20+ weeks of salary, vested equity, six months of health coverage and $5,000 transition cash. In other news, Block reported earnings of 65 cents per share for the fourth quarter, in line with the Street estimate, while revenue missed expectations. Price Action: Block shares surged 23.52% in after-hours trading after closing 4.99% higher at $54.53 during Thursday's regular trading session, according to data from Benzinga Pro. Year-to-date, the stock has tumbled 16.22%. The stock exhibited weaker price trends in short, medium, and long terms, though its Growth score remained high, according to Benzinga's Edge Rankings. Photo Courtesy: Frederic Legrand - COMEO on Shutterstock.com Market News and Data brought to you by Benzinga APIs To add Benzinga News as your preferred source on Google, click here.

Block shares surge 25% as ex-Twitter CEO Jack Dorsey lays off 4,000 employees due to AI; here's why

Block Inc. is reducing its workforce by 4,000 employees. CEO Jack Dorsey believes artificial intelligence tools will enable a smaller team to perform better. This strategic move aims to make Block a more valuable, intelligence-native company. The company's financial fundamentals remain strong, with gross profit and customer base expanding. This decision is proactive, anticipating broader industry shifts driven by AI. Shares of Block Inc. surged around 25% in after-hours trading after CEO Jack Dorsey on Thursday announced that the company will lay off 4,000 employees, saying a smaller team equipped with artificial intelligence tools can "do more and do it better". Dorsey, formerly the CEO of Twitter (now renamed X by Elon Musk), said in a letter to shareholders that these intelligence tools have changed what it means to build and run a company, with their capabilities compounding faster every week. "I don't think we're early to this realization. I think most companies are late. Within the next year, I believe the majority of companies will reach the same conclusion and make similar structural changes. I'd rather get there honestly and on our own terms than be forced into it reactively," he said. Dorsey said the move is not just about efficiency, noting that Block serves millions of customers who will also experience the economic effects of the same technological shift. Intelligence will be at the core of how the entire company operates going forward, he said, adding that it will shape how teams make decisions, build trust, manage risk, develop products and serve customers. "We believe Block will be significantly more valuable as a smaller, faster, intelligence-native company. Everything we do from here is in service of that," he said. The executive, however, said the decision was not driven by business weakness, noting that the company's fundamentals remain strong, with gross profit rising, its customer base expanding and profitability improving. He added that the company could have reduced its workforce gradually over months or years but wanted to avoid repeated rounds of layoffs, which he described as "destructive to morale, to focus, and to the trust that customers and shareholders place in our ability to lead". "I'd rather take a hard, clear action now and build from a position we believe in than manage a slow reduction of people toward the same outcome. A smaller company also gives us the space to grow our business the right way, on our own terms, instead of constantly reacting to market pressures," he added. The announcement came as Block reported a 24% year-on-year (YoY) rise in gross profit to $2.87 billion and a 20% adjusted operating income margin in Q4 FY25. "We are now expecting gross profit growth of 18% year over year for 2026 and adjusted operating income of $3.20 billion, or a 26% margin," the company said. The AI-driven layoffs come amid broader concerns about disruption in the tech sector, which has weighed on software stocks globally. Back home, IT stocks have fallen by as much as 20% on Dalal Street so far this month. (With inputs from agencies) (Disclaimer: Recommendations, suggestions, views and opinions given by the experts are their own. These do not represent the views of The Economic Times) (You can now subscribe to our ETMarkets WhatsApp channel)

Fintech company Block lays off 4,000 of its 10,000 staff, citing gains from AI

BANGKOK (AP) -- Shares in the financial technology company Block soared more than 20 per cent in premarket trading Friday after its CEO announced it was laying off more than 4,000 of its 10,000 plus employees, reconfiguring to capitalize on its use of artificial intelligence. "The core thesis is simple. Intelligence tools have changed what it means to build and run a company," Jack Dorsey said in a letter to shareholders in Block, the parent company to online payment platforms such as Square and Cash App. "A significantly smaller team, using the tools we're building, can do more and do it better," he said. Dorsey's comments explicitly naming AI as a key driver behind the move were also posted on X, or Twitter, a company he co-founded. The assertion that the job cuts will add to Block's profitability and efficiency led investors to jump in and buy, analysts said. Block's shares gained 5% Thursday to $54.53, before it reported its earnings. They shot up to nearly $69 in after-hours trading. The mobile payments services provider reported its fourth quarter gross profit jumped 24 per cent from a year earlier. "For years, we have debated whether AI would dent jobs at the margin. Now we have a public case study in which the CEO explicitly says that intelligence tools have changed what it means to build and run a company," Stephen Innes of SPI Asset Management said in a commentary. "Other large employers have announced tens of thousands of cuts in recent months. Some have downplayed the AI link. Block did not," he said. A global technology company founded in 2009, San Francisco-based Block operates in the United States, Canada, parts of Europe, Australia and Japan. In a post on Twitter, Dorsey outlined various ways the company will support those laid off. For employees overseas, the terms might differ, he said. It was unclear which employees would be laid off where. Layoffs by American companies remain at relatively healthy levels, but the job cuts at Block are the latest among thousands announced in recent months. A number of other high-profile companies have announced layoffs recently, including UPS, Amazon, Dow and the Washington Post.

Jack Dorsey's Block to slash 4,000 jobs -- nearly half of...

Block on Thursday said it will cut over 4,000 jobs -- nearly half its workforce -- as part of an overhaul to embed artificial intelligence across its operations, sending shares of the payments firm up 25% in after-hours trading. The layoffs signal how the AI boom is translating from hype into workforce changes, fueling long-held concerns among workers and economists that the technology could eliminate roles even as it boosts productivity and profits. "Intelligence tools have changed what it means to build and run a company. We're already seeing it internally. A significantly smaller team using the tools can do more and do it better," CEO Jack Dorsey said in a statement. "I don't think we're early to this realization. I think most companies are late," he added. In a post on social media platform X, Dorsey said Block opted for a single deep round of cuts instead of multiple smaller layoffs over time. He said a smaller company would also give it space to grow the business the right way, instead of constantly reacting to market pressures. Investors have been rewarding companies that show AI-driven cost savings, and the sharp workforce reduction signals the scale at which the technology is starting to translate into lower expenses and higher margins in some industries. The layoffs represent "a seminal moment" in the AI era, offering a glimpse into how the technology may fundamentally reshape the corporate world, analysts at Evercore ISI wrote in a note. The company said it expects to incur roughly $450 million to $500 million in restructuring charges. Dorsey said he expects a majority of companies to reach the same conclusion Block did and make similar structural changes. "I'd rather get there honestly and on our own terms than be forced into it reactively." Analysts at Truist said the stock was likely surging on hopes of better-than-expected 2026 margins as a result of the workforce reduction. Block posted an adjusted profit of 65 cents per share in the three months ended December 31, compared with 47 cents a year earlier. Gross profit grew 24% in the quarter, driven by a 33% surge in the Cash App business, which enables peer-to-peer mobile payments. Block said it believes it can sustain Cash App's strong gross profit growth and continue accelerating Square's gross payment volume over the next three years. For the first quarter, Block forecast gross profit would rise 22% from a year earlier to $2.80 billion. It also slightly raised its 2026 gross profit growth forecast to 18% from a preliminary view of 17%, while saying it continues to take a "prudent approach" towards both its quarterly and full-year outlook. The results come as consumer spending remains resilient despite elevated interest rates, sustaining transaction volumes across the payments sector. The results cap a broadly upbeat holiday-quarter reporting season for the payments sector, with Visa and Mastercard also posting solid results.

Jack Dorsey's Block to cut nearly half its workforce in AI overhaul, shares surge - The Economic Times

The layoffs signal how the AI boom is translating from hype into workforce changes, fueling ⁠long-held concerns ⁠among workers and economists that the technology could eliminate roles even as it boosts productivity and profits.Block on Thursday said it will cut over 4,000 jobs, nearly half its workforce, as part of an overhaul to embed artificial intelligence across its operations, sending shares of the payments firm up 25% in after-hours trading. The layoffs signal how the AI boom is translating from hype into workforce changes, fueling ⁠long-held concerns ⁠among workers and economists that the technology could eliminate roles even as it boosts productivity and profits. "Intelligence tools have changed what it means to build and run a company. We're already seeing it internally. A significantly smaller team using the tools can do more and do it better," CEO Jack Dorsey said in a statement. "I don't think we're early to this realization. I think most companies are late," he added. AI-driven overhaul In a post on social media platform X, Dorsey said Block opted for a single deep round of cuts instead of multiple smaller layoffs over time. He said a smaller ⁠company would also give it space to grow the business the right way, instead of constantly reacting to market pressures. Investors have been rewarding companies that show AI-driven cost savings, and the sharp workforce reduction signals the scale ⁠at which the technology is starting to translate into lower expenses and higher margins in some industries. The layoffs represent "a seminal moment" in the AI era, offering a glimpse into how the technology may fundamentally reshape the corporate world, analysts at Evercore ISI wrote in a note. The company said it expects to incur roughly $450 million to $500 million in restructuring charges. Dorsey said he expects a majority of companies to reach the same conclusion Block did and make similar structural changes. "I'd rather get there honestly and on our own terms than be forced into it reactively." Analysts at Truist said the stock was likely surging on hopes of better-than-expected 2026 margins as a result of the workforce reduction. Earnings momentum Block posted an adjusted profit of 65 cents per share in the three months ended December 31, compared with 47 cents a year earlier. Gross profit grew 24% in the quarter, driven by ⁠a 33% surge in the Cash App business, which enables peer-to-peer mobile payments. Block said it believes it can sustain Cash App's strong gross profit growth and continue accelerating Square's gross payment volume over the next three years. For the first quarter, Block forecast gross profit would rise 22% from a year earlier to $2.80 billion. It also slightly raised its 2026 gross profit growth forecast to 18% from a preliminary view of 17%, while saying it continues to take a "prudent approach" towards both its quarterly and full-year outlook. The results come as consumer spending remains resilient despite elevated interest rates, sustaining transaction volumes across the payments sector. The results cap a broadly upbeat holiday-quarter reporting season for the payments sector, with Visa and Mastercard also posting solid results.

Jack Dorsey's Block to cut over 4,000 jobs as AI use expands, shares surge

Feb 26 (Reuters) - Block on Thursday said it will cut over 4,000 jobs, or nearly half its workforce, as advances in AI reshape how it builds and runs its business, sending its shares up 22% in after-hours trading. The layoffs underscore how the AI boom is translating from hype into workforce changes, fueling long-held concerns among workers and economists that the technology could eliminate roles even as it boosts productivity and profits. "Intelligence tools have changed what it means to build and run a company. We're already seeing it internally. A significantly smaller team, using the tools can do more and do it better," CEO Jack Dorsey said in a statement. "I don't think we're early to this realization. I think most companies are late," he added. In a post on social media platform X, Dorsey said Block opted for a single deep round of cuts instead of multiple smaller layoffs over time. He said a smaller company would also give it space to grow the business the right way, instead of constantly reacting to market pressures. Investors have been rewarding companies that show AI-driven cost savings, and the sharp workforce reduction signals the scale at which the technology is starting to translate into lower expenses and higher margins in some industries. The company said it expects to incur roughly $450 million to $500 million in restructuring charges. Block posted an adjusted profit of 65 cents per share in the three months ended December 31, compared with 47 cents a year earlier. Gross profit grew 24% in the quarter, driven by a 33% surge in the Cash App business, which enables peer-to-peer mobile payments. (Reporting by Manya Saini in Bengaluru; Editing by Tasim Zahid)