Block, the financial technology company that owns Square, Cash App, and Tidal, announced on Thursday that it would slash its workforce by 40%, citing the growing use of “intelligence tools”.
In a detailed note on the job cuts, co-founder and CEO Jack Dorsey said artificial intelligence (AI) “fundamentally changes what it means to build and run a company,” and added that he believes many other companies are likely to take similar steps in the near future.
In his note, Dorsey said, “We're reducing our organisation by nearly half, from over 10,000 people to just under 6,000. That means over 4,000 of you are being asked to leave or entering into consultation.”
Block has carried out multiple rounds of layoffs since 2024, but this is the first time the company has explicitly cited artificial intelligence as the reason for job cuts, reported BBC. According to The New York Times, the layoffs may be the clearest sign yet of a technology company actively planning to eliminate jobs because of artificial intelligence.
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“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,” said Dorsey, who also co-founded Twitter (now X).
Dorsey said he faced two choices: reduce staff gradually over months or years, or act immediately. “I chose the latter,” he wrote, adding that repeated rounds of layoffs damage morale, focus and trust.
Dorsey also made it clear that the layoffs were not due to weak performance. “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,” he wrote.
He also outlined the compensation and transition support for affected employees. Those leaving will receive 20 weeks of salary plus an additional week per year of tenure, equity vested through the end of May, six months of healthcare coverage, corporate devices and $5,000 to support their transition. Employees outside the US will receive similar support in line with local requirements. “Everyone will be notified today,” he said, whether they are leaving, entering consultation, or staying.
Addressing employees who are leaving, Dorsey wrote, “I'm grateful for you, and I'm sorry to put you through this. You built what this company is today.”
To those staying, he took responsibility for the move. “I made this decision, and I'll own it,” he wrote, asking remaining employees to help build a company with “intelligence at the core of everything we do.”
Here's Dorsey's complete post:
According to Dorsey, more AI-driven changes are still ahead. In his annual letter to Block shareholders, he wrote, “I don't think we're early to this realisation. 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.”
While Dorsey's message is likely to unsettle rank-and-file tech workers worried about their own job security, investors reportedly reacted positively. Block's shares surged more than 26% in after-hours trading following the announcement, according to NYT.
The cuts come as artificial intelligence continues to reshape roles across the technology sector. According to CNN, companies such as Amazon, Meta, Microsoft and Verizon have also carried out sweeping layoffs over the past year that were, at least in part, linked to AI-related shifts.
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