Jack Dorsey’s Block slashes nearly half workforce in AI ‘overhaul’ – Tech Digest

Share

Block – the parent company of Square, Cash App and Tidal – announced on Thursday that it is cutting more than 4,000 jobs.

The reduction, which represents nearly half of the firm’s total workforce, is part of a radical structural overhaul aimed at embedding artificial intelligence across every facet of its operations.

Following the announcement, Block’s shares surged by as much as 25% in after-hours trading. Investors appeared to shrug off the $500 million in expected restructuring charges, instead rewarding CEO Jack Dorsey’s vision of a leaner, high-margin future.

The layoffs bring the company’s headcount down from roughly 10,000 to fewer than 6,000 employees.

In a candid letter to shareholders, Dorsey, the co-founder of Twitter, framed the decision as an inevitable evolution of the modern corporation. “Intelligence tools have changed what it means to build and run a company,” Dorsey stated.

“A significantly smaller team using the tools can do more and do it better.” He further suggested that Block is simply an early adopter of a trend that will soon become universal, adding: “I don’t think we’re early to this realization. I think most companies are late.”

The layoffs at Block represent a pivotal moment in the AI boom, signalling a shift from experimental “hype” to profound changes in the global labour market. While tech giants including Amazon, Google and Meta have also cut thousands of roles recently to pivot toward AI investment, Block is among the first major players to explicitly credit AI automation for such a massive reduction in the workforce.

Analysts at Evercore ISI described the announcement as a “seminal moment,” noting that tools such as OpenAI’s Codex and Anthropic’s Claude Code are now capable of automating complex software engineering tasks that previously required large teams.

This shift was echoed by Meta CEO Mark Zuckerberg, who recently noted that projects once requiring entire departments are now being finished by a single talented person equipped with the right tools.

Despite the workforce reduction, Block’s underlying business remains resilient. The company posted a strong holiday quarter, driven by a 33% surge in Cash App’s gross profit. By cutting costs now, Dorsey argues that Block is securing its future on its “own terms”, rather than being forced into a reactive crisis later.

For latest tech stories go to TechDigest.tv