Block, the digital payments company co-founded by Jack Dorsey, is set to trim 40% of its headcount as it leans on AI.
The sweeping reduction will cut the company’s workforce from more than 10,000 employees to just under 6,000.
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In an X post, Dorsey called the move “one of the hardest decisions in the history of our company”.
“We’re already seeing that the intelligence tools we’re creating and using, paired with smaller and flatter teams, are enabling a new way of working which fundamentally changes what it means to build and run a company. and that’s accelerating rapidly,” he said.
Affected employees will receive salary continuation for 20 weeks, plus one additional week for each year of service.
They will also get six months of continued health care coverage, retention of corporate devices, and a $5,000 payment to support their transition.
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By GlobalDataThe CEO emphasised that the layoffs are not driven by financial distress, noting that Block’s profitability is improving and its customer base continues to expand.
He noted that the company chose a single, substantial round of cuts rather than staggered smaller ones, arguing that repeated layoffs are “destructive” to morale and focus.
“A smaller company also gives us the space to grow our business the right way, on our own terms, instead of constantly reacting to market pressures” he said.
Dorsey added that the company conducted a comprehensive review to identify essential roles and personnel for future growth, with decisions “pressure-tested” from multiple perspectives.
Originally established in 2009 as Square, the company rebranded to Block in 2021 to encompass its expanding interests, including blockchain technology.
It operates the peer-to-peer payments app Cash App, the merchant point-of-sale platform Square, and the buy now, pay later service Afterpay.
In a letter to shareholders, Dorsey predicted broader AI-driven workforce changes across the economy.
“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.”
He highlighted specific AI applications already in use at Block, such as tools integrated into the Square dashboard that provide sellers with “real-time insights on menus, staffing, and customer behaviour, with clear recommendations they can act on in seconds,” he wrote.
