Square Inc: Jack Dorsey's Block to cut 4,000 jobs as it embraces AI

Jack Dorsey's payments and music group Block is cutting 4, 000 roles from a workforce of 10, 000, a move the company says reflects rapid advances in artificial intelligence. The announcement affects brands that include Square, CashApp and Tidal, and the changes will reduce headcount to less than 6, 000 while it pivots toward new intelligence tools; square inc is named among the brands tied to Block's payments business.

Scale of the cuts

The planned reduction of 4, 000 employees represents almost half of Block's 10, 000-strong workforce and will leave headcount below 6, 000. Block has carried out several rounds of layoffs since 2024 and had already cut hundreds of roles in early February. it will incur up to $500m (£370m) in restructuring costs tied to the strategy change.

Leadership and shareholder letters

Jack Dorsey, a co-founder of Twitter and a former chief executive of that company, framed the decision in a letter to shareholders. He wrote that "Intelligence tools have changed what it means to build and run a company" and said: "We're already seeing it internally. A significantly smaller team, using the tools we're building, can do more and do it better. And intelligence tool capabilities are compounding faster every week. "

Dorsey also wrote: "Within the next year, I believe the majority of companies will reach the same conclusion and make similar structural changes. " He said he did not view the move as a sign the business was in trouble, noting the firm's economic performance had been strong.

On the subject of timing, Dorsey wrote that he faced two choices — to trim gradually or to act promptly — and said: "or be honest about where we are and act on it now". He added a warning about repeated rounds of reductions: "Repeated rounds of cuts are destructive to morale, to focus and to the trust that customers and shareholders place in our ability to lead. "

In a separate comment he said: "I don't think we're early to this realisation. I think most companies are late. " Block executives on the firm’s earnings call said the company has been increasing its reliance on AI for years, with some work streams "nearly fully rolled out, others are earlier in their maturity. " Block's financial report showed strong demand for its products and services, pushing up profits at the end of last year, and the firm beat expectations for its fourth quarter with $6. 25 billion in total revenue.

Employee morale and the complaint

Employees who remain at the company signalled rapidly deteriorating morale and said there are requirements to use generative AI. An employee complaint submitted to Dorsey at a recent all-hands meeting said: "morale is probably the worst I've felt in four years" and that "the overarching culture at Block is crumbling. " Dorsey acknowledged the risks tied to the cuts in his message to shareholders.

Industry AI shift and comparisons

Block's move is part of a broader industry trend of job reductions tied to AI investment. At the end of January, Amazon cut 16, 000 positions after having already eliminated 14, 000 roles a few months earlier; 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 cut workers as focus shifted toward large AI investments.

Mark Zuckerberg, Meta's co-founder and chief executive, 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. " Other executives have pointed to similar shifts; Marc Benioff's Salesforce cut about 4, 000 jobs last year, with its CEO saying he "needs less heads" because of AI efficiency.

Analysts and institutions have debated the labour impact of AI. Goldman Sachs noted in February that faster AI adoption could drive up unemployment this year and estimated that the technology had already led to 5, 000 to 10, 000 monthly net job losses last year. A November study from the Massachusetts Institute of Technology found AI could already replace nearly 12% of the US workforce. Most tech firms are using tools that can automatically write code — examples include Claude Code from Anthropic and Codex from OpenAI — a form of automation that has prompted worries about disruption to the job market, though some analysts say the immediate threat may be exaggerated by executives seeking to appear ahead of the curve.

Square Inc and Block brands

Block said the reorganisation will touch its payments and consumer brands, listing Square, CashApp and Tidal. The company noted its shares rose by more than 20% in extended trading after the announcement and increased more than 20% in pre-market trading on Friday, reflecting investor response to the shift. Block framed the cuts as an acceleration of long-standing AI adoption, and reiterated that successful operation with a reduced workforce will depend on the effectiveness, reliability and adoption of its intelligence and AI tools; square inc remains tied to those payment operations within Block's portfolio.

Block will record restructuring charges and move forward with the reduced headcount while the company bets on expanding AI capabilities across its products and services.