Block will reduce its workforce from about 10,000 employees to fewer than 6,000 as artificial intelligence changes how companies are built and operated, according to a letter to shareholders from co founder Jack Dorsey. The restructuring marks the first time the company has explicitly cited AI as the reason for layoffs and comes amid broader job cuts across the technology sector.
AI Driven Restructuring
Dorsey wrote that AI fundamentally changes what it means to build and run a company and said he believes most companies will reach the same conclusion within the next year and make similar structural adjustments. The job reductions represent nearly half of Block’s workforce. The company, which owns Square, CashApp, and Tidal, has conducted several rounds of layoffs since 2024, but this is the first linked directly to AI.
In a later comment on Thursday, Dorsey said he does not think the industry is early in recognising AI’s impact and that many companies are already behind.
Industry Wide Job Cuts And AI Focus
Block’s announcement follows large scale layoffs elsewhere in the sector. At the end of January, Amazon cut 16,000 roles after eliminating 14,000 positions a few months earlier. Amazon chief financial officer Brian Olsavsky said during a financial results call that the company was reviewing costs as it increases AI spending.
Meta, Microsoft, and Google have also reduced headcount while directing significant resources toward AI. Meta co founder and chief executive Mark Zuckerberg said he expects 2026 to be the year AI changes how people work. He said projects that once required large teams can now be completed by a single highly skilled person.
Many technology firms are using AI tools that generate computer code, such as Claude Code from Anthropic and Codex from OpenAI. The automation of coding tasks has prompted concerns about potential job losses, though some analysts have suggested that executives may be overstating immediate risks to appear proactive.
Financial Performance And Costs
Block’s latest financial report showed strong demand for its products and services, which lifted profits at the end of last year. The company said it expects to incur up to $500m, about £370m, in restructuring costs as it shifts to its new strategy. Shares in Block rose more than 20% in extended trading after the announcement.
Dorsey previously co founded and led Twitter, which was later acquired by Elon Musk and renamed X.
Featured image credits: Wikimedia Commons
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