Dorsey predicts mass AI-driven layoffs across tech industry

"Intelligence tools have changed what it means to build and run a company. We're already seeing it internally. A significantly smaller team, using the tools we're building, can do more and do it better. And intelligence tool capabilities are compounding faster every single week. I don't think we're early to this realization. I think most companies are late."

"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."

"Block's CFO Amrita Ahuja noted a greater than 40% increase in production code shipped per engineer since September."

Jack Dorsey announced Block would reduce its workforce from over 10,000 to under 6,000 employees in February 2026, despite strong financial performance with Q4 gross profit up 26% year-over-year. This proactive restructuring stems from AI intelligence tools fundamentally changing how companies operate. Dorsey believes a significantly smaller team using advanced AI tools can accomplish more efficiently. He predicts most companies will reach similar conclusions within a year, as AI capabilities compound rapidly. Block's internal tools, including an agentic coding system called Goose, have already demonstrated results, with production code shipped per engineer increasing over 40% since September. The market initially responded positively, with shares rallying 14% following the announcement.

Read at 24/7 Wall St.