What happened
Fintech company Block, parent of Square and Cash App, announced cutting over 4,000 jobs, approximately 40% of its 10,205 global workforce, by the end of Q2 fiscal year 2026. CEO Jack Dorsey attributed the reduction to AI tools enabling "smaller and flatter teams" and a "new way of working," despite the company's 17% gross profit increase to over $10 billion in 2025. Block's stock surged 23% in after-hours trading following the announcement.
Why it matters
Workforce planning for technology companies faces immediate, large-scale disruption from AI integration. Procurement teams must evaluate the total cost of ownership for AI tools, considering potential headcount reductions as a direct metric of efficiency gains. This follows Amazon's January announcement of 16,000 layoffs, also linked to efforts to remove organisational layers.
Subscribe for Weekly Updates
Stay ahead with our weekly AI and tech briefings, delivered every Tuesday.
