Jack Dorsey Slashes Block Staff by 40% to Focus on AI

Block, the parent company of Square, Cash App and Afterpay, has announced the layoff of more than 4,000 employees, cutting nearly 40% of its workforce as it pivots sharply toward AI-driven operations. Co-Founder Jack Dorsey said the move reflects a broader shift that most companies will soon be forced to make.

In a letter to shareholders, Dorsey said a “significantly smaller team” equipped with the company’s own intelligence tools can deliver more output at higher quality. “A significantly smaller team, using the tools we’re building, can do more and do it better. And intelligence tool capabilities are compounding faster every week,” he wrote.

The layoffs will reduce Block’s headcount to just under 6,000. Prior to this, the company had expanded to more than 10,000 employees, up from 3,835 at the end of 2019. The rapid growth came during the pandemic, when demand for digital payments and online services surged across the tech sector.

Dorsey said the decision was proactive rather than reactive. “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,” he wrote.

In a separate post on X, he said the cuts were not driven by weakness in the business. “Our business is strong… gross profit continues to grow,” he wrote, adding that he chose not to “cut gradually over months or years.”

Chief Financial Officer Amrita Ahuja reiterated the message in the company’s financial guidance, stating, “We see an opportunity to move faster with smaller, highly talented teams using AI to automate more work.”

Affected employees will receive at least 20 weeks of severance depending on tenure, equity vesting through the end of May, six months of healthcare coverage, corporate devices and an additional $5,000 payment, Dorsey revealed.

Investors responded positively. Block shares rose as much as 24% following the announcement.

The move places Block among a growing list of tech companies trimming headcount as AI tools become more capable. Over the past year, companies including Amazon, Meta, Microsoft and Verizon have announced large-scale job cuts linked to restructuring and automation efforts. 

Many of these firms had significantly expanded their workforces during the pandemic and are now scaling back closer to pre-2020 levels.