Block to cut 40% of workforce, axing over 4,000 jobs for AI shift
Block will cut 40% of its 10,205-strong workforce, eliminating over 4,000 jobs by Q2 FY2026 as AI-driven tools enable smaller, flatter teams, CEO Jack Dorsey said. The company’s gross profit topped $10 billion in 2025 (+17% year-over-year) and its shares jumped 23% in after-hours trading.
1. Layoff Plan Details
Block announced on February 26 that it will reduce its global headcount by 40%, cutting more than 4,000 positions and shrinking its workforce from 10,205 employees to under 6,000 by the end of the second quarter of fiscal year 2026.
2. AI-Driven Rationale
CEO Jack Dorsey explained that advances in artificial intelligence tools paired with smaller, flatter teams create a new operating model, and he expects the majority of companies to implement similar workforce reductions within the next year.
3. Financial and Market Impact
The announcement follows Block’s 2025 gross profit exceeding $10 billion, up 17% year-over-year, and triggered a 23% surge in after-hours trading as investors cheered the potential for improved efficiency and profitability.
4. Employee Terms and Timeline
Impacted employees will receive 20 weeks of salary plus one week per year of tenure, equity vesting through May, six months of healthcare benefits, corporate devices, and a $5,000 transition stipend, with international terms varying by local law.