As the AI juggernaut bites, Jack Dorsey's 'Block' to cut 4,000 roles

Block chairman Jack Dorsey said the layoffs were not driven by financial distress but by rapid advancements and adoption of AI tools reshaping how the company operates

Twitter co-founder Jack Dorsey on Friday said that his fintech firm Block will lay off around 4,000 employees, reducing its workforce by nearly half, as part of restructuring tied to advances in artificial intelligence (AI).

 

In a message posted on X, Dorsey said: “Today we’re making one of the hardest decisions in the history of our company: 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 enter into consultation”.

 

What triggered the Block layoffs amid rapid AI adoption?

Dorsey said the move was not driven by financial distress but rather the rapid advancements and adoption of AI tools. “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,” he said. However, he added that rapid progress in AI tools had reshaped how the company operates, enabling smaller and flatter teams. 

 

“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,” Dorsey said on a call with analysts, according to Bloomberg.

 

The job cuts follow Block’s earlier rounds of reductions linked to performance reviews. The company has been restructuring since 2024 and investing in internal AI tools, including one known as Goose, to improve efficiency, the report added.

 

Following the announcement, Block’s shares rose as much as 27 per cent in after-hours trading.

 

Amrita Ahuja, chief financial officer (CFO) of Block, told Bloomberg that the company is taking this “bold and decisive” decision from a position of strength. In its shareholder letter, it reported gross profit of $10.36 billion in 2025, up 17 per cent year-on-year (Y-o-Y). Moreover, in the quarter ended on December 31, 2025, it reported an adjusted profit of 65 cents per share, up from 47 cents during the same quarter last year.

 

What severance terms has Block offered laid-off employees?

Detailing the severance terms, Dorsey said employees impacted by the cuts would be paid 20 weeks’ salary, plus an additional week’s pay for each year of service. Their equity would vest through the end of May, and they would receive six months of healthcare coverage. Staff would also be allowed to keep their corporate devices and be given $5,000 to support their transition. For employees outside the United States, similar assistance would be provided, subject to local regulations, he added.