Either way, I think this is how it's gonna be. Regardless of whether AI significantly increases productivity (40%? come on), layoffs will be preemptory. Executives will see the lack of productivity boost as being due to lack of pressure, and imagine engineers are just using the AI to make their own lives easier rather than to work more efficiently. You can't really double output velocity because your users will see it as too much churn, so the only choice is to lay off half the workforce and double the workload for those who stay. "Necessity is the mother of invention." They'll overlook the fact that the work AI tools provide only encompasses 10% of your job even if they're 100% efficient.

>> yes we over-hired during covid because i incorrectly built 2 separate company structures (square & cash app) rather than 1, which we corrected mid 2024. but this misses all the complexity we took on through lending, banking, and BNPL. and that we’re now targeting $2M+ gross profit per person, 4x our pre-covid efficiency, which stayed flat at ~$500k from 2019 until 2024. we have and do run an efficient company... better than most.

https://xcancel.com/jack/status/2027290756793135253

I.E OVER-HIRED

* Severance packages upfront because realistically that's what everyone worries about first.

* Reasoning second. I appreciate the one clean cut vs prolonged bleeding.

* Owning the decision and respecting the people that got you there. Opting for an awkward allhands vs breakup-via-text-message.

* Giving people a chance to say goodbye.

Not gonna go into strategic analysis of this, or Jack's leadership style in general.

But realistically, you can't pen a better (or, well, less bad) layoff announcement.

Yeah, you get 5 months of severance and a bunch of devices and such; but, does this CEO really think these employees will find new work in that time? In this job market?

If the profits are still up and growing, why on earth would you evict 40% of the company, to send them into this job market? Why not … try new industries, play around, try to become the next Mitsubishi or Samsung or General Electric. If you’ve got the manpower and talent, why not play with it and see if anything makes money. In-house startups with stable capital, all that.

This seems … wrong.

We're supposed to believe Jack is a victim of circumstance. He hired all those people, and now he has no choice but to fire them - he wasn't clairvoyant to the future when he hired all those people, or else he'd known he would have had to fire them. But now since he is clairvoyant to the future, he knows he must fire them.

We are all as childrens playthings right now.

Sounds like a false dichotomy. The third option is that he could have kept them around. It would be financially feasible given that "our business is strong. gross profit continues to grow, we continue to serve more and more customers, and profitability is improving.".

But these things happened: 1) Musk has shown that Twitter can operate with 5% (approximately?) of the workforce he inherited; 2) laying off a lot of people was seen as a sign that the company was in trouble, but not now because; 3) artificial intelligence makes point 2) not a semi-desperate move, but a forward-thinking adjustment to current and future technology development.

I've been out of work for almost a year now, after being laid off, and I think it's very unlikely that I'll ever return (not because of my choice but their choice) to work in the tech industry as a W2 employee. Oh well.

In my country, this action would be literally illegal.

Even in countries where it isn’t, it feels highly immoral. “I’m not in any kind of pressure to do this but I’m choosing to shed the people who created my wealth for greater personal gain”.

This is one way of making an all-in bet on AI.

>we're not going to just disappear people from slack and email and pretend they were never here. communication channels will stay open through thursday evening (pacific) so everyone can say goodbye properly, and share whatever you wish. i'll also be hosting a live video session to thank everyone at 3:35pm pacific. i know doing it this way might feel awkward. i'd rather it feel awkward and human than efficient and cold.

Well that's interesting, wonder if we'll actually get a proper accounting of which departments take which cuts.

They grew to 11000

Now they’re going to shrink to 6000

The whiplash from ZIRP days to whatever AI cost restructuring happening today is massive

I hope this gets drilled into the heads of everyone who sells their labor. The company is profitable, and Jack could have kept 4000 people employed with no difference in outcome, instead, he chose this.

>>We're three years into the ChatGPT revolution now and so far the main observable impact on the craft that I care about is that I can build more ambitious things.

>I think you refuse to extrapolate the obvious consequences and have forgotten (if you ever knew) how it's like to be in trenches. You put on the horse blinders of 'easy to build' on the left and 'so much fun' on the right and happily trot on, while the wolves of white collar job automation are closing in for the middle class.

>You believe that we'll all become cyborg centaurs, while the managers believe we'll all become redundant. You think people will care about the sideslop everyone will build, not seeing that 'everyone will build' means 'no one will care'. Worse, means no one will buy (knowledge| skill|creation).

>Indeed we have not tipped over into the abyss, but we're teetering and the wind is picking up. It's not the end times, it's not AGI, it doesn't have to be AGI to wreck great damage on the economy, our craft and, ultimately, our way of life and our minds.

>And the wind is picking up, faster and faster.

[1]https://news.ycombinator.com/item?id=47159008

From what I hear, that's kind of true across the industry. I wonder how things would be different if all these press releases pointed to Temporal as the cause rather than AI. It's kind of weird to think about. (Not that I think Temporal is the reason behind the layoffs either, but just as a thought experiment).

Honestly, If I was one of those being asked to stay, I'll be more worried and stressed because, as one commented on the tweet: to those staying...what I'm asking of you is to build with me and help me replace you too

We're about to see a lot of public SAAS companies do the same and rebrand as "AI" first

Why are companies seeing it purely in terms of "we can work with a smaller team so we must" and not "my existing team can do so much more"?

Owning a decision means you have something at stake if things go wrong. What would happen to Jack if this decision turns out to be wrong? Any consequences?

I reckon this move is related to bitcoin doing poorly. A LOT of their revenue is bitcoin related and I reckon they realized they're going to have an absolute stinker of a Q1 '26 result...

It's nice that the laid off employees are treated better than many other places. Everywhere I worked, laid off employees were instantly cut off from all access. I would say my goodbyes to them later through LinkedIn.

"Thanks to LLMs, each worker can do twice the work they could before. Naturally we are firing half the company because ... business is good and ... too much productivity is bad?"

This has nothing to do with AI. It is just a desperate move from a badly run company.

What I don’t understand is why. There’s a natural churn at each company. Of course it’s not 40%, but probably 4-5% per year, but I doubt the company freezes hiring and they are not pressured to do this.

My goal for this year is to cost Tidal / Block at least 2x of what I pay for it (so if I pay $100, make them pay $200).

Notice growth is still purportedly the priority, but if it was just about growth and AI was a growth driver they wouldn't need to cut half the company, it would just be growing. It's the transformation ritual that matters. That's what gets investor's attention. You cut thousands of jobs and announce its because of AI, congratulations you're a hot new AI company. Now the hiring can start. Faang has the same number of employees as they did before the cuts started.

If they can organize employees to make more money, they will. But they can't and admitted it.

The future rocks

With the changes to the H1B in the US, it seems it's trending to offshoring and a smaller market in general, which is a bummer for US-based people, but even then I'd just like this all settled.

I wonder if this is the beginning of a new wave of layoffs across the industry like we had in 2022.

* Block said Thursday it’s laying off more than 4,000 employees, or about half of its head count.

* Shares of the payment company skyrocketed as much as 24% in extended trading. It was last seen up nearly 18% in Friday’s premarket.

We see more and more people claiming they are so much more productive thanks to coding agents, big tech CEOs driving the use of AI like crazy, pundits anticipating rise of unemployment. Personally, I feel that productivity gains are overrated, but still, I'm pretty worried to lose my job in the near future. I'm saving aggressively.

- the company thrives on long term projects that seem to fizzle out as engineers get frustrated and leave

- there are way too many MBAs and finance people now compared to the early years where building was prioritized.

- jack is only doing part time at Block, early days he was around to chat and work with varying levels of hands on

- they've overhired and over-committed to losing projects, worst of all they've de-prioritized projects that were pretty innovative because traction wasn't there quick enough for them to justify them, e.g. terminal, POS specifically for restaurants, localization for EU

- they operate on docs and in the time of AI, the workforce is inundated with slop

- also, I hate that jack can't be bothered to capitalize anything like it's cool. come on man, you're firing 4000 people, not tweeting memes

Being in a company that has done the gradual cuts, instead of one big cut, I unironically agree. I must have dodged like 15 staff reductions at this point. Company would be in a better state if the decision was taken to go for it big time. Still, it must be hard and shocking - but only once.

In some ways this isn't daring, future looking leadership... it's much more lazy leadership that took a while to adjust to market demands.

I think this is pretty agreeable, spanning layoffs into a monthly/quarterly "Hunger Games" is very damaging to employee morale.

This part really fustrated me

> 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.

> i’m sorry to put you through this.

POV: Dude who has effortlessly fired people before deflects blame for over-hiring in the first place.

I swear people should start blacklisting CEOs and refuse to work under them if they're part of the blacklist.

This is just a piss poor excuse for bad management and short-sighted vision and no accountability.

Or how about your revenue lines are in retail and peer-to-peer finances, primarily for small-to-medium sized businesses and low-to-mid income individuals, primarily in the US market, all of which are struggling from tariffs and economic slowdown in their brackets.

Nah...definitely the AI.

Sounds like the perfect setup to start your own company!

In some cases, you have vast ability to produce and serve, but the buyers are gone.

I don't buy anything this weirdo says.

To be clear I’m not saying it was AI. I just wonder, why come out and say it like that? What’s the incentive vs. other reasons?

Making it seem like there's only going to be one mass layoff round. There will be another one, you can be certain.

2. Will other tech firms consider such large layoffs in the near future?

If AI really improves efficiency and allows the company's employees to produce more, better products faster and thus increase the competitiveness of a company... then why does said company fire (half of!) its staff instead of, well, producing more, better products faster, thus increasing its competitiveness?

Am I naive or is AI a lie when marked as a cause?

Why is it that us employees are gaslighted with the FOMO of "if you don't adopt AI to produce more, then you'll be replaced by employees who do", and why do these executives don't feel "if you fire half of your employees for whatever reason, you'll be outcompeted by companies who... simply didn't?"

No, fuck the investors. Fuck the entities causing these decisions to be more common. Extra-fuck the ever-more-obvious push for profit over literally anything else, including ethics, morals, and humanity. If you're an investor causing this shit to happen, fuck you.

Somehow this makes me feel that this org is already dead, and that this is just gonna accelerate it.

holy moly

World class software tinkerer, but no business running a public company.

Called it. This will be for every single software company. Maybe all companies.

More information: getclera.com/block It's 100% free for Talents. If you refer a talent we place into a new job, you get 1000 USD.

More information: getclera.com/block

Its 100% free

Imo companies cannot fucking help themselves but continue to grow. Meta is already back above 2021 headcount, after cutting 20k employees in 2022. Managers want to Senior Managers want to be Directors want to be VPs. The best way to do that is to grow "scope" aka people under you. And since Jack wants to be Elon and Elon wants to be God, they will happily buy that story...

Assuming the premise of profitability and a sound business then this sounds like a failure of product if anything. It just doesn't follow for me that when you see more productive teams the immediate answer is that you need less people. Especially for silicon valley types this seems antithetical to scaling.

Thinking of it in two ways

- Yes you could (in theory but I still argue not 100%) cut workforce and have a smaller # of people do the work that everyone else was doing

Or

- You could keep your people, who are ostensibly more productive with AI, and get even more work done

Why would you ever choose the first?

For some reason he deliberately avoids using the word 'artificial' here.

Would the top comments have been questioning it, telling the CEO what he should have done instead, worrying about how hard it would be for those people in today's economy?

The overarching risk, imo, is America turning against tech and its leaders / billionaires. I think this is slowly happening. And why not, if the People decide that tech is not bringing good things to our modern society anymore, that should be respected.

We built something amazing. You built it, technically. But now the real builders are smaller teams, intelligence tools, and whatever abstraction survives the next earnings call.

For the parade of mickey-mouse tech companies solving nothing and shipping products nobody asked for, the takeaway is simple: labor has become a narrative liability.

The whole thing reads like aestheticized detachment. A founder persuading himself, in pretentious all-lowercase, that mass layoffs are a principled design choice instead of the predictable invoice for years of vibe-driven growth theater. These seig-heiling, chest thumping technofascist founders are so cliche and nauseating, fucking Peter Thiel / Musk lord of the rings bunch of nerds.

Hard to imagine a better reminder of why walking away from tech back in 2023 for me felt like oxygen. I guess I consider it a luxury to read headlines like this and scoff at it from a safe distance. Dogshit industry.

Oh boy, I've heard that one before. They're in trouble.

The company is going through a hard time, and we need to let people go. So how do we explain it in a way that isn't gonna scare investors away?

Do we admit that we overhired, or that we're running out of money, or that we couldnt find the right markets? No, we don't. Instead, we explain the layoffs as AI.

This way, investors will think we are innovating, and may not think to look deeper to see the actual issues.

Time will tell. As of today, there are strong indications this statement stands on weak knees. Copium is a term I recently heard in that context, and it fits.

my mentor was on the chopping block too.

block btw now makes most of its money on bitcoin transactions not software

Any layoff that blames AI and doesn't address the fact that the company is saying it would prefer to make less, they are lying.

Rational actors should be pushing to grow when others are fearful. See: https://en.wikipedia.org/wiki/Jevons_paradox

Come on now, it's not going to be the only round.

But, otherwise, I'm onboard with the principle.

Lack of caps really grinds on you by the end.

Anyway not unexpected.

From New Yorker profile: “His goal… is… by making information freer, he hopes to make the world fairer, kinder, and nicer.”

Where he also writes, “I definitely feel the most fundamental issue is economic equality.”

But hey, the stock is up 25%!

EDIT: I guess if it comes with 300% raise I'd pause for a bit to think about it, but otherwise absolutely not.

Software developer in general are probably looking for some fucked up situation here.

Why are billionaires so allergic to using capital letters at the start of sentences? You're laying people off, it just shows how little you actually care about the detail.

"i'll own it" doesn't mean ANYTHING. You've kept your job, your money, your security. You haven't owned anything because your decision doesn't make you accountable to anyone.

Additionally, not a single person is being "asked to leave". Every single one of those people is being _told_ to leave, and given no choice about it.

Language matters, and this entire post shows how little they care.

They're cutting 40% (edit: the post actually says "nearly half") of the workforce (4k out of 10k). That's huge.

The severance is 20 weeks of pay + 1 week per year of tenure, stock vesting through May, 6 months of healthcare, their corporate devices, and $5k cash.

Once again, this is "AGI" in it's most direct and absolute version with zero fluff.

I unfortunately predicted more layoffs will occur back in 2025 [0] and I see only but acceleration on this.

[0] https://news.ycombinator.com/item?id=46307549