Block CEO Jack Dorsey lays off nearly half his workforce because of AI and predicts most companies will make similar cuts in the next year

Over the past few weeks, the tech industry has been rife with warnings about an AI-driven “jobpocalypse.” AI leader Mustafa Suleyman stated that white-collar roles have one to 18 months left before widespread displacement. A former presidential candidate and CEO agreed.

These warnings have left many professional workers anxious about their job security. Now, Jack Dorsey’s payments company has taken action that validates some of the concerns of AI skeptics who predict doom.

The Block founder revealed on Thursday that the company will cut nearly half its staff—4,000 employees—reducing its workforce from over 10,000 to just under 6,000.

Dorsey was straightforward in a post announcing the cuts, linking the layoffs directly to increased efficiency from the company’s AI use. “We’re already seeing that the intelligent tools we’re developing and using, along with smaller, more streamlined teams, are enabling a new way of working that fundamentally redefines what it means to build and operate a business,” he wrote.

Block’s layoffs represent one of the largest and most prominent AI-driven workforce cuts in S&P 500 history. 

Dorsey added that his company isn’t the only one to reach this conclusion about AI and forecasted that others would follow suit.

“I think most companies are behind. Over the next year, I expect most businesses will come to the same realization and make similar structural adjustments,” he wrote in a post.

Although Dorsey noted part of the layoffs were a response to overhiring during the COVID-19 pandemic, the cuts come amid AI-fueled apocalyptic fears among both workers and investors. Citrini’s Substack post “” painted a 2028 scenario where unemployment exceeds 10% and the S&P 500 crashes.

However, AI-related layoffs might not be what they seem. A January report found that many layoffs CEOs attributed to AI were actually a response to previous overhiring.

Where companies stand with AI implementation

Even so, some experts caution that Block’s layoffs could bring about the reality described in Citrini’s viral post, starting a domino effect of cuts across professional fields.

“While the impact of AI on the job market in 2025 was still unclear, AI capabilities have progressed quickly in recent months,” Anton Korinek, an economist specializing in the economic effects of transformative AI, told . “This could be the start of a new trend where white-collar jobs face more serious threats from AI. Once a few companies begin, competitive pressures may push others to do the same.”

Yet Dorsey’s comments come at a time when most companies are still in the early phases of AI adoption. A study found that most businesses are still testing AI use, with nearly two-thirds not yet scaling the technology. Additionally, a recent National Bureau of Economic Research survey of 6,000 CEOs and executives from firms in the U.S., U.K., Germany, and Australia found that AI has not yet had a significant impact on their operations. 

At the same time, other tech leaders have warned that AI will eventually result in fewer jobs. CEO Andy Jassy stated last year that his company would need a smaller workforce as AI began automating tasks. And CEO Marc Benioff said he “needs fewer people” after cutting 4,000 jobs as AI takes over some work. 

Block’s AI operations have paid off

For Block, using AI has strengthened its operations. “We’re not making this decision because we’re struggling,” Dorsey said in his post. “Our business is robust.” The company reported fourth-quarter gross profit of $2.87 billion, a 24% increase from the previous year.

Dorsey also noted that the company’s customer base is growing and profitability is rising—changes he credits to AI use.

The stock market has responded favorably to the move. Block’s shares rose nearly 18% on Friday as investors wagered on AI-driven productivity improvements.

Dorsey explained that the layoffs are a proactive response to an upcoming trend: “I’d prefer to get ahead on our own terms rather than be forced to react later.”