Jack Dorsey just cut Block (NYSE:XYZ | XYZ Price Prediction) nearly in half. And he thinks you’re next.
On February 26, 2026, Dorsey announced Block would reduce its workforce from over 10,000 employees to just under 6,000, a cut of more than 40%. The rationale wasn’t financial distress. Block had just delivered Q4 gross profit of $2.87 billion, up 26% year-over-year, with Cash App gross profit up 33%. This was a proactive bet.
Dorsey’s reasoning was blunt:
“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.”
That last sentence is the one that should get every investor’s attention. Dorsey isn’t just explaining a Block-specific decision. He’s making a prediction about the entire tech industry.
“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.”
The catalyst? Something that happened in December of last year, where, in Dorsey’s words, “the models just got an order of magnitude more capable and more intelligent.” Block’s internal tools, including an agentic coding harness called Goose, have already delivered results. Block’s CFO Amrita Ahuja noted a greater than 40% increase in production code shipped per engineer since September.
The market rewarded the move, at least initially. XYZ rallied roughly 14% over the month following the announcement, though shares sit around $64 as of March 11, off the post-earnings highs.
Now look at how other tech giants are threading the same needle differently. Salesforce (NYSE:CRM) CEO Marc Benioff frames his Agentforce platform as workforce augmentation, not replacement. “We are likely the last generation to lead only human teams,” Benioff said, while simultaneously planning to grow his sales headcount. Salesforce closed 3,000 paying Agentforce customers in Q4 alone. The stock, though, tells a harder story: CRM is down nearly 27% year-to-date.
Meta (NASDAQ:META) is taking yet another path, spending its way in. Zuckerberg guided for $115 to $135 billion in 2026 CapEx while simultaneously noting that “projects that used to require big teams now be accomplished by a single very talented person.” Meta is hiring elite AI researchers while flattening everyone else.
Three companies, three strategies: slash and rebuild (Block), augment and redeploy (Salesforce), invest massively and concentrate talent (Meta). Dorsey’s bet is that the first path is the most honest one, and that companies still debating it are burning time they don’t have. Whether he’s right depends on whether AI tools can actually replace organizational depth at scale, not just accelerate the engineers who already know what to build. That answer will define tech investing for the next several years.
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