UPDATE: Payments giant Block has just announced a dramatic restructuring, slashing 4,000 jobs, nearly half of its workforce, as it pivots to an AI-centric business model. This urgent move will reduce its headcount from over 10,000 employees to just under 6,000, with layoffs effective immediately or subject to consultation.
In a message shared on CEO Jack Dorsey’s X account, Block confirmed that this decision is not driven by financial strain but rather a strategic shift prompted by advancements in AI technology. The company maintains that its gross profit is still growing, and profitability is on the rise. However, they emphasize that the evolving landscape of artificial intelligence necessitates a leaner team structure.
“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,” the internal note stated. “That fundamentally changes what it means to build and run a company.”
Affected employees will receive robust severance packages, including 20 weeks’ salary, one week for each year of service, equity vested through the end of May, six months of healthcare, and $5,000 in transition support. This support underscores the company’s recognition of the impact such a significant reduction in workforce represents.
Despite Block’s claims of strong business performance, the scale of these cuts raises alarm over the implications of AI on employment. In the UK, unemployment has recently risen to 5.2 percent, with businesses slowing hiring due to the rapid adoption of automation. Research from Helm reveals that a third of Britain’s scale-up founders anticipate AI-driven job cuts within the next year, while 58 percent are already pausing or reducing recruitment efforts as AI technologies advance.
The urgency of Block’s decision reflects a broader trend, with reports indicating that over 30,000 tech roles have been eliminated globally since the beginning of 2026, even as many companies continue to report strong revenues.
Block’s overhaul aims to embed AI into “everything we do – how we work, how we create, how we serve our customers.” This clear admission from a major tech player highlights the pressing reality of AI as a direct driver of significant job losses across various sectors.
As this situation unfolds, the impact on employees and the job market at large cannot be understated. The decision to act decisively now rather than executing smaller rounds of layoffs is aimed at preserving morale and rebuilding trust within the organization. The message to staff articulated that repeated cuts would be detrimental, advocating for a “hard, clear action now” to reposition the company around AI at its core.
Observers will be watching closely as other companies may follow suit, signaling a potential seismic shift in the tech industry’s approach to workforce management in an AI-driven future. Stay tuned for further updates on this developing story.
