Block, formerly Square, announced plans to cut over 4,000 jobs, representing nearly half of its workforce, as part of a strategic overhaul to integrate artificial intelligence across its operations.
CEO Jack Dorsey stated that a smaller team equipped with AI tools can achieve more and better results, suggesting many companies are behind in this realization. This significant workforce reduction is seen as a pivotal moment in the AI era, signaling a shift from AI hype to tangible workforce changes and cost savings.
The company anticipates incurring restructuring charges between $450 million and $500 million. Investors reacted positively, with Block's shares surging 25% in after-hours trading, driven by expectations of improved margins and profitability.
The company also reported strong earnings for the December quarter, with adjusted profit per share at 65 cents and gross profit growth of 24%, largely fueled by its Cash App business.
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