Update (Feb.27, 1:25 Am UTC): This article has been updated to include more information on Block’s job cuts and earnings results.
Jack Dorsey’s payments company Block is set to cut around 40% of its staff in a major shake-up, a decision the co-founder attributed to the rapid acceleration of AI at the company.
“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 employees will receive 20 weeks of salary, plus one additional week for each year of tenure, six months of health care coverage, their corporate devices and an extra $5,000 for personal needs, Dorsey said. Employees will be notified today if they are losing their jobs or entering consultation.
Bloomberg reported earlier this month that up to 10% of Block’s workforce could be eliminated during annual performance reviews as part of a broader restructuring.
Dorsey said over 10,000 people work at Block, and just under 6,000 will remain after the cuts.
Company employee count grew by 237% in four years
Financial data website Macrotrends estimates that in 2019, Block had roughly 3,835 staff, which grew to a peak of 12,985 by 2023, representing a 237% increase in four years.
Dorsey said the current round of job cuts followed a “full review” and pressure test. In a shareholder letter released Thursday, he predicted that other companies would soon follow suit and reduce headcounts, as “intelligence tools have changed what it means to build and run a company.”
“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,” Dorsey added.
Going forward, Dorsey said Block will prioritize streamlined operations powered by AI automation to accelerate new product output and focus on a model where users can build their own features on the company’s platform.
Related: Jack Dorsey’s Square has just opened up 4M merchants to Bitcoin
Stock price spikes after cuts and earnings results
Block’s stock (XYZ) surged more than 31% to $96.58 at market open, up from its previous close of $73.65, according to Google Finance.
The company also released its Q4 2025 earnings results, reporting a gross profit of $2.87 billion, up 24% year-on-year, while its Cash App recorded a 33% year-on-year increase in revenue to $1.83 billion.
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