What was really behind Jack Dorsey laying off nearly half of Block’s staff?
Jack Dorsey cited AI as the driving force behind cutting 40% of his company’s employees, but other factors such as a weak crypto market, overstaffing and a declining stock price may also have motivated the move,Last week, the financial technology company Block announced that it would lay off 4,000 of its 10,000 workers,Dorsey, Block’s CEO, said in a letter to shareholders that advances in AI “have changed what it means to build and run a company”,“We’re already seeing it internally,A significantly smaller team, using the tools we’re building, can do more and do it better.
And intelligence tool capabilities are compounding faster every week,” he wrote.He also said that Block’s business remained strong and that these cuts weren’t an austerity measure.Can AI operate 40% of a business? Perhaps, but other specters haunt Dorsey’s company.The CEO, and by extension Block, has gone all-in on crypto for the better part of a decade, rebranding in 2021 from Square to Block to evoke “blockchain”.At the time, Dorsey redirected the business towards blockchain and Bitcoin as well as the successful Cash App.
The company announced in 2024 that it would invest 10% of its gross profit from bitcoin products into bitcoin itself.A company that has focused its business on cryptocurrency may have other reasons than the miracle of AI to trim its staff.Estimates based on Block’s public financial filings peg its bitcoin holdings around 8,500 BTC.Bitcoin has lost nearly a quarter of its value since the beginning of the year, and the broader cryptocurrency market has shown similar lackluster performance.Before Dorsey’s announcement, Block’s stock had declined by some 35% since a peak in October.
The combination of a crypto winter and a weak stock price provides a less futuristic and more tangible rationale for Dorsey’s cuts.With the radical layoff announcement, he did achieve an immediate result: Block’s stock popped by 20%, growth it sustained in the ensuing days.Markets have responded unpredictably to layoff announcements in the tech world in recent months.Just before two recent quarterly earnings calls, in October 2025 and January 2026, Amazon announced the layoffs of 14,000 and 16,000 workers, respectively.After the 2025 call, the e-commerce giant’s share price rose sharply.
Its stock price sank after its January 2026 announcement because Amazon’s costs had risen astronomically due to spending on datacenters, a problem Block does not have.Salesforce cut 4,000 customer support workers last year because the company’s CEO, Marc Benioff, said, “I need less heads” with AI.Months before, he said that AI handles some 30%-50% of the work at Salesforce.The company has only seen its stock price drop in response, as investors see the software sector, of which Block is also a member, as especially vulnerable to disruption.Goldman Sachs found in a November 2025 analysis that companies announcing layoffs underperformed the market.
Businesses that specifically referenced restructuring, often in response to automation and technological advances, lagged even further.A former business lead at Block wrote a lengthy blog post about the overstuffed teams outside of the “bitcoin hardware team” and the company’s “bloated headcount era”, which began in 2020, fueled by nearly nonexistent interest rates in the US.Dorsey has overstaffed companies before.The CEO argued on X that while Block did overhire in the past, that issue was resolved in 2024, and the recent cuts were unrelated.How Block functions after these deep staff cuts will offer insight into what AI is capable of in the absence of human employees.
Bosses across the US are raising their expectations of productivity based on AI’s promise.The pressure is especially high on software engineers, whose work can be done, at least in part, by AI coding models.Startup founders are working themselves into the ground for fear that their rivals are getting more done.So far, though, AI seems to be adding more work than it automates for the majority of workers.A Harvard study of a 200-person technology company published last month found: “AI tools didn’t reduce work, they consistently intensified it.
” Block’s remaining employees may now find themselves in the same situation.
UK motor fuel prices rise since Middle East conflict began, and energy bills could jump 10% in July – business live
Good morning, and welcome to our rolling coverage of business, the financial markets and the world economy.The dust is settling after Rachel Reeves’s spring forecast statement yesterday, which showed that growth will be weaker than hoped this year while unemployment will be higher.While the chancellor claimed the UK could ‘beat the forecasts again’, economists are concerned that the ongoing Middle East crisis will hurt the economy, and household finances, badly.The Resolution Foundation have just released their overnight analysis of the Office for Budget Responsibility’s forecast.The good news? The UK is set for a “decent”, one-off increase in living standards this year, and a bumper rise for lower-income families
War in Middle East ‘could wipe out growth in UK living standards’
The Middle East crisis could trigger an energy price shock that more than wipes out the £300 rise in living standards a typical working-age household could otherwise expect this year, a leading thinktank has warned.The Resolution Foundation said a “decent” one-off increase in average living standards in 2026 and a bumper rise for lower-income households could be reversed by rising oil and gas prices as the Iran conflict disrupts supplies.However, if the recent jump in energy prices persists, the foundation said all the gains could be wiped out.While the effect may not be as large as the increase caused by the Russian invasion of Ukraine, which sent the cost of food, oil and gas soaring, a rise this year in oil and gas prices could add a percentage point to UK inflation and £500 on typical annual energy bills, it said.The UK’s reliance on gas from the Middle East makes it especially vulnerable to an effective blockade of the strait of Hormuz, through which about 20% of the world’s liquid natural gas is transported
Europe’s next-generation fighter jet project may collapse if row continues, says warplane maker
France and Germany’s next-generation fighter jet project could soon be “dead”, one of the two companies tasked with delivering it has warned, amid a worsening corporate rift over who gets to build the aircraft.Dassault Aviation, France’s leading warplane maker, said Airbus’s defence arm – which represents Germany and Spain – needed to cooperate on the €100bn programme otherwise it would collapse.“Airbus doesn’t want to work with Dassault, full stop. I take note. I never said I didn’t want to work with Airbus or with the Germans,” said Éric Trappier, Dassault’s chief executive, via an interpreter while presenting the company’s financial results on Wednesday
Google faces lawsuit after Gemini chatbot allegedly instructed man to kill himself
Last August, Jonathan Gavalas became entirely consumed with his Google Gemini chatbot. The 36-year-old Florida resident had started casually using the artificial intelligence tool earlier that month to help with writing and shopping. Then Google introduced its Gemini Live AI assistant, which included voice-based chats that had the capability to detect people’s emotions and respond in a more human-like way.“Holy shit, this is kind of creepy,” Gavalas told the chatbot the night the feature debuted, according to court documents. “You’re way too real
South Africa v New Zealand: T20 World Cup cricket semi-final – live
7th over: New Zealand 91-0 (Seifert 47, Allen 44) The Powerplay is over; the power play is not. Seifert makes room to belabour Keshav Maharaj’s third ball through extra cover for four.A relatively quiet over, yet New Zealand still scored seven from it. They need 79 from 78 balls and should cruise to victory.6th over: New Zealand 84-0 (Seifert 41, Allen 43) Finn Allen completes an awesome Powerplay by manhandling Corbin Bosch’s first over for 22
Dennis Cometti was erudite, funny and engaging. His witticisms could fill a library
The late Tony Charlton, who called a dozen VFL grand finals and three Olympic Games, said sporting commentators should “produce words like bubbles in champagne”. There have been some sublime sporting commentators in this country. But no one in Australian broadcasting turned words into bubbles like Dennis Cometti. Few could match his repertoire of wit, timing and verve. And few were so professional, so versatile, so fully dedicated to their craft, so capable of meeting the moment
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