Because of AI: Financial services providers are cutting almost half of all jobs

Dorsey justified the cut with this fundamental change through AI: “A significantly smaller team can do more with the instruments and do it better,” he explained. “I don’t think we’re early to realize this. I think most companies are late.”

Block shares take off

The announcement caused excitement on the stock exchange: Block shares shot up in after-hours trading by 25 percent up. Analysts called the job cuts a “groundbreaking moment” in the AI ​​era. It gives a foretaste of how technology could fundamentally change the corporate world

In a post on the Social-Media-Plattform X Dorsey continued that Block chose to cut jobs in a single, deep round of cuts rather than making multiple waves of layoffs over time. He would rather take the step “honestly and on our own terms” than be forced to do so later.

Up to $500 million in conversion costs

Block expects costs to cost between 450 million and 500 million dollars. Operationally, things went smoothly for the financial service provider in the past quarter. Adjusted earnings per share rose to 65 cents in the three months ended December, compared with 47 cents in the year-earlier period. Gross profit increased by 24 percent. The main reason for this was an increase of 33 percent for the Cash App, through which users can send money.