Block (XYZ) Shares Soar 31% Following Mass Workforce Reduction of 4,000

TLDR

Table of Contents

Block (XYZ) is eliminating approximately 4,000 positions, representing nearly 40% of its total workforce, reducing headcount to around 6,000
Jack Dorsey attributes the decision to artificial intelligence productivity improvements, enabling leaner teams to accomplish more
Shares of Block skyrocketed more than 31% to $96.58 in response to the workforce reduction and quarterly results
Fourth quarter 2025 gross profit reached $2.87 billion, representing 24% year-over-year growth; Cash App sales climbed 33%
Impacted workers will receive 20 weeks base pay, additional weeks based on tenure, six months healthcare continuation, and $5,000 personal support

Jack Dorsey’s fintech company Block is eliminating approximately 4,000 positions — representing nearly 40% of its entire employee base.

we're making @blocks smaller today. here's my note to the company.

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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 organization, which reached approximately 13,000 employees at its 2023 peak, will operate with just under 6,000 workers following these reductions. This brings staffing levels close to its 2019 pre-pandemic footprint of roughly 3,835 employees.

Dorsey revealed the restructuring in a public letter posted to X, linking it directly to advancing artificial intelligence tools being deployed throughout 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 swift, decisive action over prolonged cuts spanning months or years, maintaining that successive layoff waves undermine employee morale and organizational trust.

Workers impacted by the cuts will receive compensation including 20 weeks of base salary, an extra week for each year of service, healthcare benefits for six months, company equipment to keep, and $5,000 for personal expenses. Termination notices started being distributed on the same day the announcement was made.

Dorsey forecasts similar moves across the industry. “I don’t think we’re early to this realization. I think most companies are late,” he stated, projecting that the majority of organizations will arrive at similar conclusions within twelve months.

Block’s employee count expanded by 237% from 2019 through 2023, based on Macrotrends figures. This current reduction represents the company’s most substantial workforce cut — significantly larger than the 10% decrease Bloomberg had reported as under consideration earlier this month.

Stock Jumps on Cuts and Strong Earnings

Shares of Block (XYZ) climbed more than 31% to reach $96.58 at the opening bell, rising from the prior closing price of $73.65.

Block, Inc., XYZ

The workforce announcement coincided with the company’s fourth quarter 2025 financial disclosure. Block delivered gross profit of $2.87 billion, marking 24% year-over-year expansion. Cash App recorded 33% year-over-year revenue growth, reaching $1.83 billion.

Investor response was immediate and substantial, although the stock price remains approximately 80% below its pandemic-era high.

Stablecoins Add a Structural Question

While Dorsey’s communication emphasizes AI-driven efficiency, market observers have identified another structural pressure: stablecoin payment infrastructure.

Block developed its primary business around card-based merchant transaction fees, generally ranging from 2% to 3% per transaction. Stablecoin technology can facilitate identical transactions at virtually no cost, creating pressure on that revenue model.

Analysis from Citrini Research highlights that “agentic shopping” — where artificial intelligence systems automatically direct payment flows — may hasten the migration away from traditional card networks altogether.

The GENIUS Act alongside Circle’s public offering have brought stablecoins significantly closer to widespread commercial acceptance, transforming this into a more pressing concern than during Block’s expansion phase.

Not everyone accepts the restructuring as purely 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 latest available financial metrics.

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