TLDR
- Block (XYZ) is cutting around 4,000 jobs, nearly 40% of its workforce, leaving roughly 6,000 employees
- CEO Jack Dorsey cited AI-driven productivity gains as the reason, saying smaller teams can now do more
- Block’s stock surged over 31% to $96.58 following the announcement and Q4 earnings release
- Q4 2025 gross profit came in at $2.87 billion, up 24% year-on-year; Cash App revenue rose 33%
- Affected employees will receive 20 weeks of salary, plus one week per year of tenure, six months of healthcare, and $5,000 for personal needs
Jack Dorsey’s Block is cutting around 4,000 jobs — nearly 40% of its total workforce.
we're making @blocks smaller today. here's my note to the company.
####
today we're making one of the hardest decisions in the history of our company: we're reducing our organization by nearly half, from over 10,000 people to just under 6,000. that means over 4,000 of you are…
— jack (@jack) February 26, 2026
The company, which peaked at roughly 13,000 employees in 2023, will be left with just under 6,000 staff after the cuts. That takes it close to its pre-pandemic size of around 3,835 in 2019.
Dorsey announced the move in a letter shared on X, attributing it directly to accelerating AI capabilities inside the company.
“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 wrote.
He said he chose to act decisively rather than draw out cuts over months or years, arguing that repeated rounds of layoffs damage morale and erode trust.
Employees affected will receive 20 weeks of base salary, one additional week per year of tenure, six months of healthcare coverage, their corporate devices, and a $5,000 personal needs payment. Notifications began going out the same day as the announcement.
Dorsey predicted other companies will follow. “I don’t think we’re early to this realization. I think most companies are late,” he wrote, adding that the majority of companies will reach the same conclusion within a year.
Block’s headcount had grown 237% between 2019 and 2023, according to Macrotrends data. This latest cut is the deepest the company has made — far steeper than the 10% reduction that had been previously flagged by Bloomberg earlier this month.
Stock Jumps on Cuts and Strong Earnings
Block’s stock (XYZ) jumped more than 31% to $96.58 at market open, up from a previous close of $73.65.
The move came alongside the release of Q4 2025 earnings results. Block reported gross profit of $2.87 billion, up 24% year-on-year. Cash App posted a 33% year-on-year revenue increase, hitting $1.83 billion.
The market reaction was sharp, though the stock still sits roughly 80% below its pandemic-era peak.
Stablecoins Add a Structural Question
While Dorsey’s letter focuses on AI efficiency, analysts have pointed to another pressure: stablecoin-based payment rails.
Block built its core business on card-based merchant fees, typically 2% to 3% per transaction. Stablecoins can process the same transactions at near-zero cost, which squeezes that fee model.
Research from Citrini Research notes that “agentic shopping” — where AI tools autonomously route payments — could accelerate the shift away from card networks entirely.
The GENIUS Act and Circle’s IPO have moved stablecoins closer to mainstream adoption, making this a more immediate concern than it was during Block’s hiring boom.
Not everyone is convinced the cuts are purely strategic. Ben Carlson, director at Ritholtz Wealth Management, posted on X: “Or maybe the stock is down 80% from the highs and they overhired and AI is a convenient excuse.”
Block’s Q4 gross profit of $2.87 billion and Cash App’s 33% revenue growth remain the most recent figures on record.
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