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Jack Dorsey's Block said it plans to cut about 4,000 jobs, reducing its workforce by nearly half, as the company restructures around artificial intelligence and smaller teams. The announcement came with its latest earnings update and triggered a sharp after-hours stock move. Block shares rose more than 20% in extended trading after the company disclosed the cuts and outlined its strategy.
Block described the layoffs as a strategic decision tied to productivity and execution. Chief Executive Officer Jack Dorsey said the company wants to operate with smaller teams and apply AI across more parts of the business. He said Block chose to make the changes in one step rather than through repeated rounds of cuts.
Dorsey also said AI capabilities improved faster than expected in recent months. He told analysts that newer models created a clearer path for using AI in nearly every part of Block’s operations. The company has invested in internal AI tools, including Goose, to improve efficiency and reduce manual work.
Block positioned the restructuring as a proactive move rather than a response to immediate financial stress. The company said it is changing its structure while its core businesses continue to grow. That message formed a key part of the company’s explanation to investors and employees.
Block also detailed support for employees affected by the layoffs. US employees will receive severance pay, six months of healthcare coverage, equity vesting through the end of May, corporate devices, and a US$5,000 transition payment. The company said employees outside the United States will receive similar support based on local policies.
Investors responded quickly after the announcement. Block shares rose sharply in after-hours trading as the market focused on the company’s cost-cutting plan and push for faster execution. The jump came after a long stretch of pressure on the stock, which had fallen notably since early 2025.
Block released the job-cut plan alongside solid 2025 results. The company posted US$10.36 billion in gross profit for the year, a 17% increase from the previous year. It also pointed to stronger fourth-quarter momentum, with gains in gross profit, user activity, and payment volume across its main products.
The company said growth of users on Cash App improved, lending products scaled, and Square gross payment volume accelerated. Chief Financial Officer Amrita Ahuja said Block is taking decisive action from a position of strength and aims to move faster for customers with smaller, highly skilled teams supported by AI tools.
This combination of cost restructuring and growth metrics shaped the positive market response. Investors focused on the possibility that Block can improve margins while maintaining product expansion. At the same time, the scale of the layoffs raised questions about how quickly AI can replace or automate work across large fintech businesses.
Block’s decision comes as more technology and fintech companies connect workforce changes to AI adoption. Executives across the sector have argued that AI can increase productivity and allow companies to do more with fewer employees. This trend has intensified debate over whether companies are cutting jobs because of AI gains, cost discipline, or both.
Block began the restructuring after earlier layoffs and closer investor focus on growth and competition. The company hired rapidly during the pandemic and kept hiring into the recovery.
It later shifted toward tighter staffing as conditions changed. This round is the company’s biggest workforce reset so far.
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