Block, the company led by Jack Dorsey, cut its workforce from more than 10,000 employees to under 6,000 on Thursday, releasing the move alongside fourth-quarter 2025 results. The company reported 24% gross profit growth to $2.87 billion, while Cash App posted 33% year-over-year gross profit growth. After the announcement, Block shares rose more than 20% in after-hours trading, adding nearly $6 billion in market value.
Dorsey ties smaller headcount to AI-driven efficiency
In his shareholder letter, Dorsey said intelligence tools have changed what it means to build and run a company, adding that a significantly smaller team using the tools Block is building can do more and do it better. That framing placed AI at the center of the restructuring story. Investors saw margin and profit momentum. Critics saw a company cutting deeply while presenting automation as the explanation.
The market reaction was immediate, but the reasoning behind the layoffs was challenged almost as quickly.
Critics say the cuts look more like a reversal of past overhiring
Will Slaughter pointed to Block’s rapid expansion from 3,900 employees in 2019 to 12,500 in 2022. His argument was blunt: the current reduction appears tied less to AI replacing jobs and more to unwinding an aggressive pandemic-era hiring spree.
Dorsey acknowledged that history directly. He said Block did overhire during COVID because he incorrectly built two separate company structures, Square and Cash App, instead of one. He also said the company is now targeting more than $2 million in gross profit per employee, which he described as 4x pre-COVID efficiency.
Another flashpoint came from spending. Bull Theory highlighted that Block spent $68 million on a single company event in September 2025, a cost recorded in earnings under higher general and administrative expenses. The comparison circulated widely: roughly the annual payroll for 200 employees at $340,000 each. Social media mockery added to the backlash, including a viral fake layoff post from satirist Alex Cohen.
Cash App’s Bitcoin business is now the key watchpoint
For crypto users, the larger issue is what this means for Cash App. Block operates one of the biggest retail Bitcoin platforms in the U.S., with millions of users buying, selling, and holding BTC through the app. The company also runs Bitkey, a self-custody Bitcoin wallet, and Proto, its Bitcoin mining hardware division.
Cash App generated $1.83 billion in gross profit last quarter, up 33% from a year earlier, making it Block’s dominant profit engine. The source material says 40% fewer employees are now managing that infrastructure. That leaves crypto markets watching whether a leaner Block can push its Bitcoin strategy faster, or whether reduced staffing will make that business harder to maintain.