Block, the Oakland-based financial technology company, said it will reduce its workforce by roughly 40 percent, trimming staff from more than 10,000 to under 6,000, according to the company announcement and a memo from CEO Jack Dorsey.
Dorsey wrote that intelligence tools have changed what it means to build and run a company and that a significantly smaller team using the tools Block is building can do more and do it better, as reported by Block.
The company said its business remains strong, with gross profit growth and improving profitability, and noted that its share price rose in after-hours trading following the announcement, as reported by Block.
Observers pointed out tensions in the explanation for the cuts, with Wharton associate professor Ethan Mollick saying on LinkedIn that given how new effective AI tools are, it is hard to imagine a firm-wide sudden 50 percent plus efficiency gain that would justify such sweeping cuts, as reported by media coverage.
Reactions Compensation And Broader Industry Signals
Business Insider coverage described the move as a departure from repeated layoff rounds, saying Dorsey prefers a single, large reduction to avoid chronic anxiety and morale damage from piecemeal cuts, and cited management professor Brooks Holtom on layoff fatigue.
The company offered severance that Business Insider reported as 20 weeks of base pay plus one additional week per year of tenure, equity vesting through the end of May, six months of health coverage, continued use of corporate devices, and a $5,000 payment.
Commentary noted possible motives beyond efficiency. Business Insider cited Stanford assistant professor Michael Blank saying CEOs may signal investors they are positioned to adopt changing AI technologies, while others raised the possibility of AI washing, according to media reporting.
Business Insider also linked the announcement to a wider conversation about AI and jobs, referencing a viral report from research firm Citrini that raised fears about AI impact, warnings from Anthropic CEO Dario Amodei and Meta CEO Mark Zuckerberg about white-collar disruption, and projections in the World Economic Forum 2026 Global Risk report about job displacement and creation, as reported by that outlet.
Block nearly doubled headcount between late 2020 and 2025 and its share price has fallen more than 75 percent over the past five years, facts reported in the company memo and media coverage that frame the timing of the cuts.
