Block cuts nearly half its workforce in sweeping AI overhaul
Block on Thursday announced it will cut nearly half of its workforce as the company moves to embed artificial intelligence across its operations. The decision makes block's pivot to AI immediate and affects more than 4, 000 jobs, with wide-ranging severance and stock implications for employees.
Scope of cuts: from more than 10, 000 to just under 6, 000
CEO Jack Dorsey said the company will reduce its headcount "by nearly half, from over 10, 000 people to just under 6, 000, " a change that "means over 4, 000 of you are being asked to leave or entering into consultation. " He described the move as "one of the hardest decisions in the history of our company, " and said he chose a single round of large cuts rather than a series of smaller reductions to give the company room to grow as it adapts to the AI era.
Severance package and transition support for affected employees
Dorsey outlined the benefits for employees leaving the company: 20 weeks of salary plus one week per year of tenure, equity vesting through the end of May, six months of healthcare, corporate devices and a $5, 000 payment to help with the transition. Those measures are intended to aid the "over 4, 000" workers impacted by the reductions.
How Dorsey framed the change and the role of intelligence tools
In a series of posts on a social platform he previously led when it had a different name, Dorsey said he is not cutting jobs because the company is in trouble but because a smaller workforce "gives us the space to grow our business the right way, on our own terms, instead of constantly reacting to market pressures. " He added 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. "
Dorsey also said Block will be built with "intelligence at the core of everything we do. how we work, how we create, how we serve our customers. " He acknowledged a structural error during the pandemic, writing that the company "over-hired during covid because i incorrectly built 2 separate company structures (square & cash app) rather than 1, which we corrected mid 2024. but this misses all the complexity we took on through lending, banking, and BNPL. "
Market reaction and stock movement after the announcement
Block shares surged after the announcement, rising 17% during Friday morning trading. The stock was up 22% over the prior week, though it remained down by more than 2% year to date. Dorsey said the layoffs will give block a better route to growth as the company reshapes around artificial intelligence.
The restructuring, the severance terms, the company-wide headcount reduction from "over 10, 000" to "just under 6, 000, " and the explicit tally of "over 4, 000" impacted roles were all set out in Dorsey' s public posts announcing the changes.
