In a letter to shareholders, Dorsey said the decision reflects a shift in how companies are built and managed, News.Az reports, citing AP.
“The core thesis is simple. Intelligence tools have changed what it means to build and run a company,” he wrote. “A significantly smaller team, using the tools we’re building, can do more and do it better.”
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Block is the parent company of Square and Cash App. Dorsey also shared his comments on X, the social media platform he co-founded.
Analysts said investors responded positively to the company’s assertion that the workforce reduction would improve profitability and operational efficiency. Prior to the earnings release, Block’s shares had gained 5% during regular trading on Thursday, closing at $54.53. Following the announcement, the stock climbed to nearly $69 in after-hours trading.
The mobile payments provider also reported a 24% year-over-year increase in fourth-quarter gross profit, adding momentum to the rally.
While overall layoffs across U.S. companies remain at relatively moderate levels, Block’s job cuts add to a wave of reductions announced in recent months. Other major firms that have recently disclosed layoffs include UPS, Amazon, Dow, and The Washington Post.
