In a dramatic corporate announcement, thousands of employees at major payment platform Block are facing imminent redundancy after CEO Jack Dorsey declared a sweeping downsizing initiative driven by artificial intelligence acceleration. The company, which is the US-based parent of Afterpay and Square, will reduce its global workforce from over 10,000 to under 6,000 employees, representing a cut of approximately 4,000 positions.
Sudden Announcement and Global Impact
Jack Dorsey, founder and former CEO of X, revealed the restructuring plans through a lengthy social media post on Friday, describing it as "one of the hardest decisions in the history of our company." The announcement came with minimal warning, with affected employees expected to receive notification within 24 hours. Block employs just over 1,000 Australian staff through its operations, though the company has not specified which regions or departments will bear the brunt of the reductions.
AI-Driven Restructuring Rather Than Financial Necessity
In a notable departure from typical corporate downsizing narratives, Dorsey explicitly stated that the cuts were not prompted by financial troubles. "We're not making this decision because we're in trouble," he wrote. "Our business is strong. Gross profit continues to grow, we continue to serve more and more customers, and profitability is improving."
Instead, Dorsey attributed the dramatic workforce reduction to accelerating artificial intelligence adoption. "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 which fundamentally changes what it means to build and run a company," he explained. "And that's accelerating rapidly."
Comprehensive Severance Package Details
Employees affected by the cuts will receive substantial support during their transition. According to Dorsey's announcement, departing staff will receive:
- Salary for 20 weeks
- Additional week of pay per year of tenure
- Equity vested through the end of May
- Six months of healthcare coverage
- Retention of corporate devices
- US$5,000 transition assistance payment
Dorsey noted that international employees would receive "similar support" with variations based on local requirements. The CEO defended the sudden, comprehensive approach to downsizing, arguing that more gradual, repeated rounds of cuts would be "destructive to morale."
Uncertainty Surrounding Afterpay Operations
Particular uncertainty surrounds the future of Afterpay, the payment platform originally founded in Sydney with current headquarters in Melbourne's CBD. Block has not clarified whether Afterpay will experience significant job reductions as part of the broader restructuring. The company also declined to elaborate on how different regions or business units would be affected by the workforce reductions.
Broader Tech Industry Trend
The Block announcement follows similar workforce reductions across the technology sector driven by artificial intelligence adoption. Just days earlier, WiseTech CEO Zubin Appoo revealed an "AI transformation program" that would eliminate approximately 2,000 positions through "phased headcount reduction, initially in product and development and customer service, by up to 50 percent."
Financial institutions are also implementing similar strategies, with Commonwealth Bank announcing plans to lay off 300 Australian employees despite recording a $5 billion profit just weeks prior. These developments suggest a broader industry trend where companies are restructuring workforces in response to rapidly evolving AI capabilities rather than traditional financial pressures.
Block, which began as Square manufacturing tap-and-pay terminals for phones and bank card transactions, has grown into a global financial technology powerhouse. The company's decision to implement such substantial workforce reductions while maintaining strong financial performance highlights the transformative impact artificial intelligence is having on corporate structures and employment patterns across multiple industries.
