Block’s Layoffs are a Sign of Times to Come

Recently, Square’s owner Block (NYSE: XYZ) was in the news for the massive layoffs announced at the organization as it adopts AI for its operations. Block firmly believes in the advancements in AI tools that are showing it how to operate more efficiently.

Block’s Financials

Block’s recently reported net revenues for the fourth quarter of the year came in at $6.25 billion, missing the analyst estimates of $6.32 billion. EPS of $0.65 was in line with market estimates.

Block ended the year with revenues relatively flat at $24.2 million compared to $24.1 million reported a year ago. EPS for the period fell from $4.56 to $2.10.

The company did not provide an outlook. Analysts expect it to report revenues of $6.28 billion for the first quarter with an EPS of $0.73 and revenues of $3.4 billion for the year.

Block’s AI Adoption

Block is committed to unlocking AI capabilities that will help its customers become more efficient. As part of that effort, it recently introduced Managerbot, an AI agent embedded in its Square platform that proactively monitors a seller’s business, identifies emerging problems, and proposes actionable solutions. The bot can forecast inventory, schedule employee shifts, and run automated marketing campaigns to drive the ecommerce business. The bot leverages access to the business’ invoicing, inventory, customer management, marketing, payroll, and scheduling tools to arrive at the decisions that need to be taken to drive growth. For now, it still waits for the business’ approval before taking any actions. Block believes that using Managerbot will help provide more value to sellers.

Block’s Layoffs

But the biggest news for Block recently was the announcement that it was laying off almost 40% of its staff, despite the strong financial performance. Co-founder Jack Dorsey believes that this is just a sign of times to come. The company claims that it can leverage a significantly smaller team and AI tools that they are building to “do more and do it better”. Instead of gradually reducing its workforce over the course of the next few quarters, Block wanted to act more decisively, hence the massive lay-off.

The market was pleased with Block’s decision, and the stock soared 26% after the announcement. Based on recent reports, it does not look like Mr. Dorsey will stop with the layoffs soon. In a recent conversation, he mentioned a desire to eliminate the layers in an organization. In his ideal organization, all 6,000 employees will report to him because he believes that AI will make the workload more manageable.

Block’s stock is trading at $66.15 with a market capitalization of $41.2 billion. It hit a 52-week high of $82.504 in July last year. Its stock hit a 52-week low of $44.27 in May last year.

AI-led layoffs are causing a significant escalation in anti-AI sentiment. Earlier this month, a 20-year old youth had published his anti-AI thoughts on a sub-stack, and then he had gone ahead and thrown a Molotov cocktail at Sam Altman’s home in an attempt to harm him. The man has been arrested and is undergoing legal proceedings.

According to a recent report published by Stanford on public sentiment toward AI, the percentage of people globally who are “nervous” about AI-powered products and services grew to 52% in 2025 from 50% a year ago. Within the US, 64% of those who were surveyed were nervous about the technology. The report also estimates that AI will lead to fewer jobs in the next 20 years. The fear of joblessness, coupled with the significant pace of AI’s development is causing the emotional surge. Not only is there a need to see governments take faster, more meaningful actions for UBI, but there is also a need for individuals to look for meaningful alternatives.

As of April 2026, the global tech industry has recorded 78,557 layoffs, with 76.7% occurring in U.S. companies. While giants like Oracle (25,000+), Amazon (16,000), and Block (4,000) lead the charge, a disturbing pattern has emerged.

According to research by Alan Cohen (RationalFX), nearly half of these job losses are now explicitly tied to “AI Restructuring.” However, a deeper analysis suggests that AI is often being used as an “AI-as-an-excuse” narrative to justify aggressive cost-cutting and boost sagging stock prices. Companies like Oracle have automated the termination process itself, firing thousands via 6:00 AM emails—a cold-blooded approach that reflects a total deficit of empathy and human kindness.

The 1Mby1M Perspective: Stop Being the Victim

There is only one permanent solution to this trend of mass layoffs and “AI-driven” displacement: Learn to become an entrepreneur. You don’t have to build a “Unicorn.” You just need to solve a real problem, build a sustainable business, and create your own livelihood. This tsunami of layoffs will continue; paralysis is not a solution. * If you have been laid off: Now is the time to pivot your skills toward a venture you own.

If you still have a job: Now is the perfect time to consider bootstrapping a startup with a paycheck before the next 6:00 AM email arrives.

Take Action Now

• For the Displaced: Equity-Free Accelerator for Laid-Off Techies | 1Mby1M
• For the Part-Time Founder Hedging Against Layoffs: Bootstrap with a Paycheck through 1Mby1M
• Free Mentoring: Join our Free Mentoring Roundtables for Startup Founders to get direct feedback on your idea.
• Rapid Validation: Use the 1Mby1M AI Mentor to stress-test your business model 24/7.

Master the Strategy: Enroll in the Udemy AI Mentor Prompt Course to learn how to use AI to build—not replace—your future.

About 1Mby1M:

One Million by One Million (1Mby1M) is the first global virtual accelerator in the world, founded in 2010 by Silicon Valley serial Entrepreneur Sramana Mitra. It offers a fully online entrepreneurship incubation, acceleration and education resource for solo entrepreneurs and bootstrapped founders working on tech and tech-enabled services ventures.

1Mby1M does not charge equity, offers an AI Mentor available 24/7 in 57 languages, and offers a compelling alternative to Y Combinator and other equity accelerators.

Photo Credit: MichaelWuensch from Pixabay

Disclosure: All investors should make their own assessments based on their own research, informed interpretations, and risk appetite. This article expresses my own opinions based on my own research of product-market fit, channel execution, and other factors. My primary interest is in product strategy. While this may have bearing on stock movements, my writings tend to focus on long-term implications. The information presented is illustrative and educational, but should not be regarded as a complete analysis nor recommendation to buy or sell the securities mentioned herein. I am not a registered investment adviser and I am not receiving compensation for this article.