Block CEO Jack Dorsey says AI drove layoffs as shares surge
Block's CEO Jack Dorsey told shareholders the company is cutting more than 4, 000 roles as it reconfigures to use artificial intelligence, a shift that sent block's stock sharply higher in premarket trading and after-hours. The move, Dorsey wrote, is meant to let "a significantly smaller team" use new tools to increase efficiency.
Dorsey frames the cuts as an AI-driven reconfiguration
In a letter to shareholders in Block, Jack Dorsey said, "The core thesis is simple. Intelligence tools have changed what it means to build and run a company. " He added, "A significantly smaller team, using the tools we're building, can do more and do it better. " Dorsey also posted the comments on X, or Twitter, a company he co-founded.
Scale of the reductions: more than 4, 000 of 10, 000-plus employees
The company announced it would lay off more than 4, 000 of its 10, 000 plus employees. Dorsey outlined various ways the company will support those laid off, and said terms might differ for employees overseas. It was unclear in the provided context which employees would be laid off where.
Market reaction: shares surged in premarket and after-hours trading
Shares in Block soared more than 20% in premarket trading Friday after Dorsey's announcement. The stock had gained 5% Thursday to $54. 53 before the company reported earnings and then shot up to nearly $69 in after-hours trading. Analysts said the assertion that the job cuts will add to Block's profitability and efficiency prompted investors to buy.
Quarterly results and profitability figures cited
The mobile payments services provider reported its fourth quarter gross profit jumped 24% from a year earlier, a figure the company disclosed alongside its earnings that preceded the after-hours spike. Executives tied the profitability picture to the rationale for the workforce changes.
Broader labor context and outside commentary
Stephen Innes of SPI Asset Management wrote that for years there was debate over whether AI would dent jobs at the margin, and noted Block offers a public case study with its CEO explicitly linking intelligence tools to organizational change. Innes added that other large employers have announced tens of thousands of cuts in recent months and that some have downplayed the AI link; "Block did not, " he said.
Company footprint and industry ripples
Block, founded in 2009 and based in San Francisco, operates in the United States, Canada, parts of Europe, Australia and Japan. The layoffs at block are the latest among thousands announced in recent months as American companies continue to trim workforces; other high-profile firms that have announced cuts include UPS, Amazon, Dow and the Washington Post.
Left: Square CEO Jack Dorsey in 2015 on the floor of the New York Stock Exchange.
