Jack Dorsey’s Block Cut Half Its Staff, and He Says Other Tech Firms Will Follow Soon

Gizmodo · Feb 27, 2026 · Collected from RSS

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Block CEO Jack Dorsey announced Thursday that the company will make drastic cuts as “intelligence tools” create a new way to work. He also warned that other companies could make similar changes soon. Dorsey shared his note to employees in a post on X. He wrote that Block, the company behind Square and Cash App, is reducing its headcount to 6,000 from roughly 10,000. That leaves more than 4,000 workers being laid off or asked to enter consultation. Dorsey noted the move had nothing to do with the company’s financial health. In fact, he said gross profit and the customer base are growing. Instead, he argued that the company’s intelligence tools are making it possible to operate with “smaller and flatter teams.” Block is effectively betting AI can replace nearly half its workforce, even though survey after survey has shown that most executives say that significant productivity gains from their AI investments have yet to materialize. Dorsey added that he could have made the cuts gradually over months and years or “be honest about where we are and act on it now.” He said he chose the latter because repeated layoffs erode morale, focus, and trust. The cuts come as many tech companies have slashed their staff in recent years while making similar arguments that they need smaller, faster-moving workforces with less bureaucracy. Just this year, Pinterest, Vimeo, and Amazon have all announced cuts. Amazon alone laid off roughly 16,000 workers in January after cutting 14,000 last October. In a blog post at the time, Amazon Senior Vice President of People Experience and Technology Beth Galetti acknowledged the concerns repeated layoffs can raise, the same point Dorsey alluded to. “Some of you might ask if this is the beginning of a new rhythm – where we announce broad reductions every few months,” wrote Galetti. “That’s not our plan. But just as we always have, every team will continue to evaluate the ownership, speed, and capacity to invent for customers, and make adjustments as appropriate.” Dorsey predicts more companies will soon follow his more blunt approach. “Within the next year, I believe the majority of companies will reach the same conclusion and make similar structural changes,” Dorsey said in a letter to shareholders. “I’d rather get there honestly and on our own terms than be forced into it reactively.” In a separate X post, he later acknowledged that the company overhired after the pandemic, but downplayed its role in Thursday’s layoffs, arguing Block is more efficient now than it was pre-pandemic. Even so, if companies are still readjusting after jumping on the pandemic-era hiring spree, it remains an open question whether the industry will face a similar reversal from this era’s AI cuts. The cuts at Block come just a couple of weeks after OpenAI CEO Sam Altman warned of a coming wave of “AI washing” from companies that blame the emerging technology for layoffs that are entirely unrelated. Of course, CEOs are also suddenly acknowledging that public sentiment is turning hard against AI, with data center construction being a major political sticking point in an election year. So Altman has his own motivations for deflecting blame over job losses.