Block announced a significant workforce reduction, cutting more than 4,000 employees, or nearly half of its global staff. This strategic move, disclosed on Thursday, sent the company’s stock soaring by over 24% in extended trading hours.
In a letter to shareholders, Block’s co-founder and CEO, Jack Dorsey, described the decision as “difficult,” explaining the company is shrinking from over 10,000 employees to under 6,000. “This means that over 4,000 people are being asked to leave or entering into consultation,” Dorsey stated.
Amrita Ahuja, Block’s CFO, emphasized that these workforce adjustments are designed to position the company for “long term growth.” She noted a strategic shift in operations, leveraging artificial intelligence to automate tasks and enable smaller, highly skilled teams to accelerate progress. “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 remarked.
Dorsey anticipates a broader trend across industries, predicting that many companies will follow suit as they realize efficiency gains through AI. “Within the next year, I believe the majority of companies will reach the same conclusion and make similar structural changes,” Dorsey commented. “I’d rather get there honestly and on our own terms than be forced into it reactively.”
This move by Block aligns with recent decisions by other tech firms. Companies such as Pinterest, CrowdStrike, and Chegg have also announced substantial layoffs, explicitly citing the impact of AI in reshaping their operational needs and workforce structures.
Dorsey detailed his rationale on X, formerly Twitter, explaining that he opted for a decisive, immediate reduction rather than a series of gradual layoffs over an extended period. “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 argued.
As of December 31, 2025, Block employed 10,205 individuals globally, according to its latest annual filing. The company unveiled these layoff plans concurrently with its fourth-quarter financial results.
Financially, Block reported adjusted earnings per share of 65 cents on revenue of $6.25 billion, aligning with analyst expectations. Gross profit saw a notable increase of 24% year-over-year, reaching $2.87 billion. For the full fiscal year, the company projects adjusted earnings per share of $3.66, surpassing analyst forecasts of $3.22.
The company anticipates incurring restructuring charges between $450 million and $500 million, primarily for severance packages, employee benefits, and non-cash expenses related to share vesting. Most of these charges are expected to be recognized in the first quarter.
The significant workforce reduction is a clear signal of Block’s strategic pivot towards greater efficiency and agility, driven by the accelerating capabilities of artificial intelligence. This move underscores a growing trend in the tech sector where companies are re-evaluating their operational models in response to technological advancements and market dynamics.
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