Block Slashes Workforce by 50%
Block, parent of Square and Cash App, has cut nearly half its workforce, citing massive productivity gains from AI. The company's CFO claims its custom LLM, "goose," has automated so many functions over the last 18 months that smaller teams can now deliver the same output. This is being framed as a strategic AI-driven restructuring, not just a cost-cutting measure.
The company's custom AI agent, "goose," is an open-source framework released in January 2025, designed to automate complex software engineering tasks. It functions as an on-machine assistant that can execute shell commands, edit files, and orchestrate multi-step workflows autonomously, integrating with tools like GitHub and various IDEs. Goose is model-agnostic, supporting over 25 LLM providers, including those from Google, Anthropic, and OpenAI, and can even run with local models for privacy. The workforce reduction will shrink Block from over 10,000 employees to just under 6,000, affecting more than 4,000 people. The move is framed as a proactive restructuring at a time of business strength, with Block reporting a 24% year-over-year increase in gross profit for Q4 2025. CEO Jack Dorsey predicts most companies will make similar structural changes within the next year. This decision triggered a significant market reaction, with Block's stock surging over 20% in after-hours trading following the announcement. Investors have seemingly rewarded the aggressive move towards efficiency, with analysts from William Blair noting the market approves of the strategy to become more "focused, nimble, and profitable." The company expects to incur restructuring charges of $450 million to $500 million, primarily for severance. However, there is skepticism about AI being the sole driver for the cuts. Some former employees and analysts suggest the move is a "convenient and flashy new cover for typical corporate downsizing," pointing to organizational bloat as a contributing factor. Cuts to policy and diversity and inclusion teams, in particular, are seen by some as standard cost-saving measures rather than a direct result of AI-driven reinvention.
