Jack Dorsey Cuts 40% of Block Staff, Says Company Must Become 'An Intelligence'

Jack Dorsey just fired 40% of Block's workforce. That's roughly 3,700 people gone in one sweep.

According to WIRED's exclusive interview, Dorsey didn't mince words. He told the publication he cut these jobs to rebuild Block "as an intelligence" rather than a traditional company with human workers performing tasks.

The scale stunned observers. Reuters reports this represents one of the largest single-round layoffs in fintech history, especially for a profitable company. Block generated $23.5 billion in revenue last year across Square, Cash App, and other services.

Dorsey's framing goes beyond typical automation talk. He wants Block to function as what he calls "an intelligence" – essentially an AI-driven system that can operate with minimal human intervention.

The Guardian notes this vision involves replacing entire teams with AI systems that can handle customer service, fraud detection, underwriting, and merchant onboarding. Current and former employees told the paper these systems aren't ready for prime time, describing them as "glitchy" and "prone to errors that humans catch."

Bloomberg captured Dorsey's own uncertainty during a follow-up interview. When pressed on whether AI would ultimately create more jobs than it eliminates, he replied: "I honestly don't know. We're building something that's never existed before."

Former Block workers aren't buying the AI narrative. The New York Times published a scathing op-ed from a recently laid-off engineer who claims the cuts had "little to do with AI readiness and everything to do with quarterly earnings."

Multiple employees across different departments told The Guardian that their roles involved complex decision-making and relationship management that AI simply can't replicate. One former risk analyst described spending 60% of their time on nuanced merchant relationships that required reading subtle market signals and building trust over months.

The SF Standard reports that internal Slack messages leaked from remaining employees show widespread panic about job security, with many questioning whether staying at Block means training their AI replacements.

Industry analysts smell something familiar. American Banker points out that Block's stock jumped 12% immediately after the layoff announcement, suggesting investors care more about reduced costs than AI transformation.

Futurism dug deeper, noting that Block's AI systems currently handle only about 15% of customer service queries successfully without human escalation. The publication argues Dorsey's "intelligence" framing is "equal parts vision and convenient excuse for mass layoffs."

Yahoo Finance highlights that Block's operating expenses had ballooned 34% year-over-year, making the cuts financially expedient regardless of AI capabilities. The timing coincides with increased pressure from activist investors who've been pushing for margin improvements.

Competitors are watching closely. Stripe, PayPal, and traditional banks see this as either brilliant positioning or massive risk-taking that could backfire spectacularly.

CNN reports that Stripe quietly accelerated hiring in areas where Block cut staff, particularly in relationship management and complex fraud prevention. PayPal's CEO reportedly told investors they're taking a "more measured approach" to AI integration after seeing the backlash.

The broader fintech sector faces a reckoning. If Dorsey's bet pays off, expect rapid imitation. If it fails, the industry might pull back from aggressive AI deployment. Either way, venture capitalists tell Reuters they're now scrutinizing AI-first pitches with more skepticism.

Dorsey claims the transition will take 18-24 months. During this period, remaining Block employees will train AI systems while gradually taking on more strategic roles.

The company plans to release its first "AI-native" features by Q3 2026, starting with automated merchant onboarding for small businesses. Success or failure here will likely determine whether other tech CEOs follow suit with similarly dramatic cuts.

One thing's certain: 3,700 former Block employees are now competing for jobs in a market that's increasingly skeptical of AI-first companies. Several have already filed a class-action lawsuit alleging the layoffs violated California's WARN act by not providing proper notice.

Dorsey's experiment raises uncomfortable questions about the tech industry's relationship with human labor. When pressed by Bloomberg about whether this represents a broader trend, he deflected: "Every company will face this choice eventually. We're just being honest about it."

The implications extend beyond fintech. If Block succeeds in replacing 40% of its workforce with AI while maintaining growth, expect similar moves across software, finance, and customer service. Thestar argues this could trigger a "domino effect" of automation-driven layoffs throughout 2026.

Yet Dorsey's own uncertainty suggests even he doesn't fully grasp what he's unleashed. In perhaps the most telling moment of the WIRED interview, when asked what advice he'd give other CEOs considering similar moves, he paused for 12 seconds before responding: "Make sure you're ready to live with the consequences."