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Payment technology firm Block, founded by former Twitter exec Jack Dorsey, is cutting almost half its workforce, saying AI is reshaping how the company operates, marking one of the most significant AI-linked job reductions in the tech sector.
The move will reduce headcount to fewer than 6,000 employees from 10,000 across the business, which owns Square, CashApp, and Tidal. The company has conducted several rounds of layoffs since 2024, although this is the first time it has explicitly cited AI as the primary driver.
Jack Dorsey, Block’s Co-Founder, said the shift reflects a broader reassessment of how organizations are built.
"Within the next year, I believe the majority of companies will reach the same conclusion and make similar structural changes," he wrote in a letter to shareholders.
AI and structural workforce change
Dorsey said artificial intelligence "fundamentally changes what it means to build and run a company", and suggested the transformation is already overdue.
"I don't think we're early to this realisation," he said. "I think most companies are late".
The announcement comes as major technology employers intensify investment in AI while trimming roles in other parts of their operations.
At the end of January Amazon laid off 16,000 employees, having already cut 14,000 roles a few months earlier. During a subsequent earnings call, Brian Olsavsky, Amazon’s Chief Financial Officer, said the company was examining further cost reductions as it increases AI spending.
Meta, Microsoft and Google have also reduced headcount as resources shift toward large-scale AI initiatives. Mark Zuckerberg, Meta’s Co-Founder and Chief Executive, said he expects "2026 to be the year that AI dramatically changes the way we work."
"We're starting to see projects that used to take big teams now be accomplished by a single, very talented person," Zuckerberg said.
Automation and the future of tech roles
Many technology companies now deploy AI tools that automatically generate computer code required to operate software or websites, including Claude Code from Anthropic and Codex from OpenAI.
Automation of tasks historically performed by highly trained employees has fueled concern about longer-term labor market disruption. Some analysts argue that the short-term threat to jobs may be overstated, suggesting executives are keen to demonstrate leadership in AI adoption.
Block’s financial report indicated strong demand for its products and services, boosting profits at the end of last year. The company said it expects to incur up to $500m in restructuring costs as it pivots toward its revised strategy.
Following the announcement, Block’s shares rose more than 20% in extended trading.
Dorsey, who co-founded Twitter before it was acquired by Elon Musk and renamed X, says the decision is part of a wider structural reset that he believes other companies will soon follow.
