Block layoffs: Jack Dorsey’s firm to let over 4,000 employees go in AI overhaul, shares soar 27%
Prevent layoffs: Jack Dorsey’s Block, the company behind Square, Cash App and Afterpay, is laying off nearly half its staff as part of an overhaul to embrace artificial intelligence in its operations.
More than 4,000 employees will be allowed to deploy “intelligence tools” as part of layoffs at Block, Dorsey, the company’s co-founder, said in a letter to shareholders on Thursday.
Block has been restructuring its business model and staff since 2024 due to the company’s stocks falling behind. Following the announcement, Block shares rose up to 27% in extended trading.
The company has also invested heavily in artificial intelligence to enable efficient operations, including creating its own AI tool called Goose.
The layoffs at the Blok follow ongoing job eliminations that are often tied to annual performance evaluations.
The layoffs at Block are the latest in fintech and the broader tech sector, where companies are eliminating workforces while pointing to artificial intelligence as the catalyst. Companies from Amazon to Salesforce have cited technology as the rationale behind thousands of employee departures.
The layoffs signal how the AI boom is shifting from hype to workforce shifts, fueling long-standing concerns among workers and economists that the technology could eliminate roles while boosting productivity and profits.
Jack Dorsey says most companies will follow
In a statement on Thursday, Block co-founder Jack Dorsey said artificial intelligence is changing the way companies operate and his firm is late to the party.
“Intelligence tools have changed what it means to start and run a company. We’re already seeing this internally. A much smaller team using the tools can do more and better.”
Dorsey stated that more companies will follow suit.
“I don’t think we’re too early to realize this. I think most companies are too late,” he said.
“I believe that within the next year the majority of companies will come to the same conclusion and make similar structural changes. I would rather get to that point honestly and on our own terms than be forced to do so reactively,” Dorsey added.
Block did not provide much detail on how AI technology would make certain roles redundant. Dorsey’s claim is that building AI tools in-house rather than being disrupted by them can sustain a leaner company.
What benefits will employees get?
In a post on X, Jack Dorsey listed a number of benefits that Block’s laid-off employees will receive.
“If you are one of those affected, you will receive $5,000 to put towards your salary for 20 weeks + 1 week per year of assignment, equity earned through the end of May, 6 months of healthcare, corporate devices, and anything else you need to help you through this transition,” he wrote.
However, people outside the US will receive a smaller amount, Dorsey said, adding that the exact details are being worked out and will vary depending on local requirements.
“Everyone will be notified today whether you are being asked to leave, go into consultation, or stay,” he said.
The company said it expects restructuring expenses to be approximately $450 million to $500 million.
