Jack Dorsey's Block lays off over 900 employees
What's the story
Jack Dorsey, co-founder and CEO of fintech giant Block, has laid off 931 employees, nearly 8% of its workforce. The news was revealed in a leaked email to TechCrunch, where Dorsey said the company would be "making some org changes, including eliminating roles and beginning the consultation process in countries where required." This follows a previous round of layoffs in January 2024 when it cut around 1,000 jobs.
Categorization
Layoffs categorized into 3 groups
In his email, Dorsey detailed the layoffs under three broad categories. The first category includes cutting 391 employees for "strategy" reasons. The second and largest group includes 460 employees being let go for "performance" reasons. These are the people who received a "below" rating on Block's internal performance tracking metrics or were trending toward it.
Management adjustments
Dorsey addresses management changes
The last group impacted by the layoffs includes 80 managers. Dorsey said these roles are being cut to simplify Block's hierarchy to "innercore+4." This means his direct reports and four levels of direct reports after that. He also confirmed that 193 managers would be moved to individual contributor roles as part of this restructuring effort.
Denial
Dorsey denies financial motives behind layoffs
Dorsey clarified in his email that the layoffs were neither driven by financial constraints nor an intention to replace employees with AI. He said these decisions were made due to evolving strategic needs while "raising the bar and acting faster on performance." This clarification was important as it dispelled any misconceptions about the reasons behind these significant job cuts at Block.
Job closures
Block to close 748 open roles
Dorsey also announced that Block would be closing 748 open roles at the company, except for those that have progressed to an offer stage, critical operations roles, and key leadership roles among others. The decision is part of the company's strategy to focus on its core business areas and streamline its operations further.