Block Shares Surge 19% After Jack Dorsey Cuts Workforce Nearly In Half

Core Insights - Block, led by Jack Dorsey, announced a significant workforce reduction of over 4,000 employees, nearly halving its workforce, in anticipation of increased efficiency from AI tools [2][3] - The company's shares surged 19.3% in premarket trading, marking the largest intraday gain since February 2022, following the announcement [1][2] Financial Performance - Block reported a 24% year-over-year growth in gross profits, reaching $2.87 billion, driven by a 33% increase in Cash App's gross profit to $1.83 billion [2] Industry Trends - Dorsey highlighted that "intelligence tools" are transforming company operations, allowing smaller teams to achieve more efficiency [3] - A study from MIT indicated that AI could potentially replace 11.7% of the U.S. labor market, equating to approximately $1.2 trillion in wages across various sectors [4] - Concerns about AI replacing jobs have been prevalent, with some companies already reducing their workforce due to AI advancements, such as Klarna, which cut its workforce by 40% [6]