Square Inc parent Block to cut nearly half its workforce as Jack Dorsey leans into AI

Block, the parent of square inc products, said it will cut roughly 4, 000 jobs from a 10, 000-strong workforce as CEO Jack Dorsey signaled a strategic shift toward artificial intelligence tools — a move that pushed the company’s shares up by more than 20% after the announcement.

CEO frames layoffs as acceleration toward AI-driven productivity

Dorsey wrote in a letter to shareholders that "intelligence tools have changed what it means to build and run a company, " adding that "a significantly smaller team, using the tools we're building, can do more and do it better. " He warned that intelligence tool capabilities are "compounding faster every week" and said, "Within the next year, I believe the majority of companies will reach the same conclusion and make similar structural changes. "

Numbers: job cuts, finances and restructuring costs

the layoffs will reduce headcount from 10, 000 to less than 6, 000 and that it expects to incur up to $500m (£370m) in restructuring costs as it pivots. Block’s financial report showed strong demand for its products and services, and the company beat expectations in the fourth quarter, reporting $6. 25 billion in total revenue. Shares rose by more than 20% in extended trading after the announcement, and one market update showed shares increased more than 20% in pre-market trading on Friday.

Square Inc brands and earlier cuts

Block owns Square, Cash App and Tidal. Executives said the company has been increasing its reliance on AI for years, with some AI work streams "nearly fully rolled out, others are earlier in their maturity. " The company had already laid off hundreds of workers in early February, and overall the business has seen several rounds of layoffs since 2024.

Wider industry context and employee reactions

The move at Block follows a wave of job cuts across the tech sector tied to AI investments. At the end of January, Amazon cut 16, 000 roles after earlier trimming 14, 000; Brian Olsavsky, Amazon’s chief financial officer, said the company was looking at cost reductions elsewhere as it ramps up AI spending. Meta, Microsoft and Google have also laid off workers while shifting focus to large AI investments. Mark Zuckerberg said he is expecting "2026 to be the year that AI dramatically changes the way we work, " and added, "We're starting to see projects that used to take big teams now be accomplished by a single, very talented person. " Goldman Sachs has warned that accelerating AI adoption could push up unemployment, estimating 5, 000 to 10, 000 monthly net job losses in a recent period, and a November study from the Massachusetts Institute of Technology estimated AI could already replace nearly 12% of the U. S. workforce.

Morale, regulatory caution and operational risk

Employees remaining at the firm have reported rapidly deteriorating morale and new requirements to use generative AI; an employee complaint reviewed by Wired said "morale is probably the worst I've felt in four years" and that "the overarching culture at Block is crumbling. " Dorsey acknowledged the risk of the cuts in his messages, and the company’s most recent 10-K filing warned that the ability to operate with a reduced workforce will depend on the "effectiveness, reliability and adoption of our proactive intelligence and AI tools, " noting these technologies "may not perform as expected, may require more time or expense to implement effectively, may introduce operational or cybersecurity risks or may fail to enhance productivity and maintain operational efficiency. "

Dorsey also framed the decision as a choice between gradual trimming and immediate action, writing that he had two options: cut gradually over months and years, or "be honest about where we are and act on it now. " He added that repeated rounds of cuts are "destructive to morale, to focus and to the trust that customers and shareholders place in our ability to lead. " Dorsey is co‑founder and former chief executive of Twitter, which was later bought by Elon Musk and renamed X.

Block’s CEO said the move is not because the business is in trouble but is driven by AI productivity gains; the company’s executives expect the shift to depend on the rollout and performance of their AI tools. Looking ahead, Dorsey has said he believes most companies will reach a similar conclusion within the next year.