Jack Dorsey, the co-founder and CEO of the financial conglomerate Block, formerly known as Square, announced the most drastic corporate reduction in the company’s history in a decision that has shocked the fintech industry. Includes several well-known fintech companies, including the popular US mobile payment app Cash App. Dorsey acknowledged that the company will cut its workforce by roughly 50%, or nearly 4,000 people, in a thorough memo to the workplace that was distributed via X.
The CEO claims that the move is a strategic evolution meant to “re-center” the business on a more effective, AI-driven model rather than an indication of financial trouble. After-hours trading saw a 23.5% increase in Block’s share price, which trades under the symbol $XYZ, as investors responded to the prospect of leaner operations with overwhelming optimism.
Businesses are increasingly embracing AI to “do more with less” in the tech and finance sectors, which is reflected in this change. The size of Block’s cuts, though, is really remarkable. Dorsey’s decision to let off over half of the workforce shows a complete commitment to a new and automated era of corporate management, even though many other companies have only made five or ten percent reductions.
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