Block Cuts Nearly Half Its Workforce in AI-Native Shift, Shares Surge More Than 22% After Hours

Fintech company Block has been pursuing an AI-first strategy alongside workforce reductions and a redesign of internal workflows, aiming to sustain product development with smaller teams. The overhaul is significant because it moves generative AI beyond an optional coding aid and into the core of day-to-day engineering, offering a closely watched test of whether AI can deliver measurable productivity gains and lower operating costs across a large technology company.

Nearly six months into the initiative, Block is beginning to see results from the organizational shift. Chief Executive Officer Jack Dorsey said Buzz, the company’s internal AI agent collaboration platform, enables small teams to accelerate software development and move products forward more quickly. AI now participates in almost every production code change at Block, indicating that the technology has become deeply embedded in its engineering process and supporting the company’s case for broader operational efficiency.

Block, formerly the payments company Square, operates businesses spanning Cash App, merchant services and Bitcoin. Chief Executive Jack Dorsey has advocated using AI to reshape corporate infrastructure and is working with Sequoia to build an AI-centered organization aimed at reducing management layers and accelerating decision-making and product development.

Block recently announced it would cut about 4,000 employees, or roughly 40% of its workforce, but did not disclose the related restructuring costs or an exact effective date. Dorsey said the company would become “smaller, faster and more focused,” and expects AI to take over some middle-management and coordination work.