Block cuts 40% of workforce as AI strategy boosts earnings

Block just fired nearly half its employees and Wall Street loved it. The fintech company behind Square and Cash App announced on February 26 that it’s cutting over 4,000 jobs, roughly 40% of its entire workforce, as part of what CEO Jack Dorsey described as an AI-driven operational overhaul. The company’s headcount will shrink from over 10,000 to under 6,000. Block’s stock surged 20-25% in after-hours trading. The numbers behind the bloodbath Block’s Q4 2025 gross profit hit $10.36 billion, a 17% jump year-over-year. Cash App was the standout performer, with its gross profit climbing 33% over the same period. The company raised its 2026 outlook, forecasting gross profit of $12.20 billion, an 18% increase from the prior year. Block also projected adjusted operating income of $3.20 billion and adjusted diluted earnings per share of $3.66. Block expects to absorb between $450 million and $500 million in restructuring charges, with the bulk landing in Q1 2026. Dorsey framed the cuts not as a response to financial trouble but as a strategic bet. Smaller teams armed with AI tools, the argument goes, can outperform bloated departments that were hired during the pandemic-era growth binge. ...