TLDR
- Block (XYZ) is eliminating approximately 4,000 positions, representing nearly 40% of total staff, reducing headcount to around 6,000
- Jack Dorsey, the company’s CEO, attributed the decision to AI-enabled productivity improvements that allow leaner teams to achieve more
- Shares of Block soared more than 31% to $96.58 in response to the workforce reduction and quarterly financial results
- Fourth quarter 2025 gross profit reached $2.87 billion, marking a 24% increase from the prior year; Cash App revenues climbed 33%
- Departing workers will get 20 weeks of base pay, additional weeks based on tenure, healthcare for six months, and $5,000 for personal expenses
Jack Dorsey’s payment and financial services company Block is eliminating approximately 4,000 positions — representing close to 40% of its entire employee base.
The organization, which reached approximately 13,000 employees at its 2023 peak, will operate with fewer than 6,000 staff members following these reductions. This brings the company back to a size similar to its pre-pandemic footprint of roughly 3,835 employees in 2019.
Dorsey revealed the restructuring through a letter published on X, directly linking the decision to rapid advancements in artificial intelligence tools deployed within the organization.
“We’re already seeing that the intelligence tools we’re creating and using, paired with smaller and flatter teams, are enabling a new way of working,” he stated.
He explained his preference for making decisive cuts immediately rather than stretching reductions across an extended timeline, noting that successive rounds of job eliminations undermine employee confidence and organizational trust.
Departing staff members will be provided with 20 weeks of base compensation, one extra week for each year of service, healthcare benefits extending six months, their company-issued equipment, and a $5,000 payment designated for personal expenses. Employee notifications commenced on the same day the announcement was made public.
Dorsey suggested this represents a broader industry trend. “I don’t think we’re early to this realization. I think most companies are late,” he stated, projecting that the majority of corporations will arrive at similar conclusions within the next year.
Block’s employee count had expanded by 237% from 2019 through 2023, based on Macrotrends data. This workforce reduction represents the most significant cut in company history — substantially larger than the 10% reduction Bloomberg had reported earlier this month.
Stock Jumps on Cuts and Strong Earnings
Shares of Block (XYZ) climbed more than 31% to reach $96.58 at the market opening, compared to the prior closing price of $73.65.
The workforce announcement coincided with the company’s fourth quarter 2025 financial disclosure. Block delivered gross profit totaling $2.87 billion, representing a 24% year-over-year increase. Cash App generated revenues of $1.83 billion, reflecting a 33% gain compared to the same period last year.
Market participants responded enthusiastically, though the stock price remains approximately 80% below its pandemic-era high.
Stablecoins Add a Structural Question
While Dorsey’s communication emphasized AI-driven efficiency improvements, market observers have identified another competitive challenge: stablecoin-powered payment infrastructure.
Block constructed its primary business model around card-based transaction fees, which typically range from 2% to 3% per payment. Stablecoin networks can facilitate identical transactions at minimal cost, creating pressure on traditional fee structures.
Analysis from Citrini Research highlights that “agentic shopping” — autonomous AI systems that independently select payment methods — may hasten the transition away from conventional card networks.
The GENIUS Act along with Circle’s public offering have advanced stablecoins toward widespread commercial acceptance, transforming this into a more pressing concern than it represented during Block’s aggressive hiring period.
Some observers question whether the cuts are entirely strategic. Ben Carlson, director at Ritholtz Wealth Management, commented on X: “Or maybe the stock is down 80% from the highs and they overhired and AI is a convenient excuse.”
Block’s fourth quarter gross profit of $2.87 billion and Cash App’s 33% revenue expansion represent the company’s most current financial performance data available.
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