We’ve been talking about this here for a couple weeks. Is the singularity near? Will artificial intelligence be a boon to the economy? Will it also be a threat to certain white collar jobs? Is the whole thing just hype? No one action is going to answer all of those questions but maybe you can begin to see the start of what could be a trend in this story.
Today, Jack Dorsey, the co-founder of Twitter and of Square, announced that Block (the new name for Square) would be laying off 40% of its employees. That’s not because the company is in trouble but because he says those workers are no longer needed.
we’re making @blocks smaller today. here’s my note to the company.
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today we’re making one of the hardest decisions in the history of our company: we’re reducing our organization by nearly half, from over 10,000 people to just under 6,000. that means over 4,000 of you are…
— jack (@jack) February 26, 2026
Let’s walk through this:
today we’re making one of the hardest decisions in the history of our company: we’re reducing our organization by nearly half, from over 10,000 people to just under 6,000. that means over 4,000 of you are being asked to leave or entering into consultation. i’ll be straight about what’s happening, why, and what it means for everyone.
first off, if you’re one of the people affected, you’ll receive your salary for 20 weeks + 1 week per year of tenure, equity vested through the end of may, 6 months of health care, your corporate devices, and $5,000 to put toward whatever you need to help you in this transition (if you’re outside the U.S. you’ll receive similar support but exact details are going to vary based on local requirements). i want you to know that before anything else. everyone will be notified today, whether you’re being asked to leave, entering consultation, or asked to stay.
Having explained the basics of what is happening, he moves on to why. [emphasis added]
we’re not making this decision because we’re in trouble. our business is strong. gross profit continues to grow, we continue to serve more and more customers, and profitability is improving. but something has changed. we’re already seeing that the intelligence tools we’re creating and using, paired with smaller and flatter teams, are enabling a new way of working which fundamentally changes what it means to build and run a company. and that’s accelerating rapidly.
Given that change, which is based on AI, he had a choice between ripping off the band-aid or peeling it off slowly.
i had two options: cut gradually over months or years as this shift plays out, or be honest about where we are and act on it now. i chose the latter. repeated rounds of cuts are destructive to morale, to focus, and to the trust that customers and shareholders place in our ability to lead. i’d rather take a hard, clear action now and build from a position we believe in than manage a slow reduction of people toward the same outcome. a smaller company also gives us the space to grow our business the right way, on our own terms, instead of constantly reacting to market pressures.
a decision at this scale carries risk. but so does standing still. we’ve done a full review to determine the roles and people we require to reliably grow the business from here, and we’ve pressure-tested those decisions from multiple angles. i accept that we may have gotten some of them wrong, and we’ve built in flexibility to account for that, and do the right thing for our customers.
I’m skipping one paragraph and then his final word to those leaving and those staying.
to those of you leaving…i’m grateful for you, and i’m sorry to put you through this. you built what this company is today. that’s a fact that i’ll honor forever. this decision is not a reflection of what you contributed. you will be a great contributor to any organization going forward.
to those staying…i made this decision, and i’ll own it. what i’m asking of you is to build with me. we’re going to build this company with intelligence at the core of everything we do. how we work, how we create, how we serve our customers. our customers will feel this shift too, and we’re going to help them navigate it: towards a future where they can build their own features directly, composed of our capabilities and served through our interfaces. that’s what i’m focused on now. expect a note from me tomorrow.
jack
So what does all of this mean? Well, just yesterday, Jack retweet a post from Andrej Karpathy, a previous director of AI for Tesla.
It is hard to communicate how much programming has changed due to AI in the last 2 months: not gradually and over time in the “progress as usual” way, but specifically this last December. There are a number of asterisks but imo coding agents basically didn’t work before December and basically work since – the models have significantly higher quality, long-term coherence and tenacity and they can power through large and long tasks, well past enough that it is extremely disruptive to the default programming workflow.
Just to give an example, over the weekend I was building a local video analysis dashboard for the cameras of my home so I wrote: “Here is the local IP and username/password of my DGX Spark. Log in, set up ssh keys, set up vLLM, download and bench Qwen3-VL, set up a server endpoint to inference videos, a basic web ui dashboard, test everything, set it up with systemd, record memory notes for yourself and write up a markdown report for me”. The agent went off for ~30 minutes, ran into multiple issues, researched solutions online, resolved them one by one, wrote the code, tested it, debugged it, set up the services, and came back with the report and it was just done. I didn’t touch anything. All of this could easily have been a weekend project just 3 months ago but today it’s something you kick off and forget about for 30 minutes.
As a result, programming is becoming unrecognizable. You’re not typing computer code into an editor like the way things were since computers were invented, that era is over. You’re spinning up AI agents, giving them tasks *in English* and managing and reviewing their work in parallel.
This is nearly identical to what other AI insiders have been saying this month. The tools have taken a big leap forward and can now do a lot of things on their own that would have taken a real person hours as recently as last year.
Jack Dorsey thinks what he’s doing at Block is something many other tech companies will be doing soon for the same reason. With AI fewer human coders are needed.
Mr. Dorsey said he did not believe that Block was the first company to realize that the rapid developments of A.I. would change businesses — nor that it would be the last.
“I think most companies are late,” he wrote. “Within the next year, I believe the majority of companies will reach the same conclusion and make similar structural changes. I’d rather get there honestly and on our own terms than be forced into it reactively.”
He’s making a bet about the future. He could be wrong about how that will work out but he’s certainly putting his money where his mouth is. He believes AI means the company can have a 40% smaller workforce and still be growing. If he’s right about that, then it’s going to have a big impact on a lot of tech companies, probably fairly soon.
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