Block said Thursday it’s laying off more than 4,000 employees, or about half of its headcount. The stock skyrocketed more than 24% in extended trading.

“Today we shared a difficult decision with our team,” Jack Dorsey, Block’s co-founder and CEO, wrote in a letter to shareholders. “We’re reducing Block by nearly half, from over 10,000 people to just under 6,000, which means that over 4,000 people are being asked to leave or entering into consultation.”

Block CFO Amrita Ahuja said the job cuts will position the company “for our next phase of long term growth.”

“We are choosing to shift how we operate at a time when our business is accelerating and we see an opportunity to move faster with smaller, highly talented teams using AI to automate more work,” Ahuja wrote.

Dorsey said he expects other companies to similarly overhaul their workforces as they see more efficiency gains from “intelligence tools.”

“Within the next year, I believe the majority of companies will reach the same conclusion and make similar structural changes,” Dorsey said. “I’d rather get there honestly and on our own terms than be forced into it reactively.”

In an X post, Dorsey said he was faced with the choice of laying off staffers over several months or years “as this shift plays out,” or to “act on it now.”

“I chose the latter,” Dorsey wrote. “Repeated rounds of cuts are destructive to morale, to focus, and to the trust that customers and shareholders place in our ability to lead.”

The company had 10,205 employees worldwide as of Dec. 31, 2025, according to its annual filing.

Block announced the layoffs in conjunction with its fourth quarter earnings results.

The payments company reported adjusted earnings per share of 65 cents on revenue of $6.25 billion, while analysts estimated 65 cents per share and $6.24 billion, according to LSEG.

For the full year, the company said it sees adjusted earnings per share of $3.66. Analysts anticipated $3.22 per share, according to LSEG.

As a result of the workforce reduction, the company expects to incur charges of approximately $450 million to $500 million, consisting primarily of severance payments, employee benefits, and non-cash expenses related to share vesting, according to a securities filing.

Block expects most of the restructuring charges to be incurred in the first quarter.

Pinterest said Tuesday it plans to lay off less than 15% of its workforce and cut back on office space as the company embraces artificial intelligence.

In a securities filing, Pinterest said it expects the cuts will be complete by the end of its third quarter in late September. Shares of Pinterest closed down more than 9%.

The social media company said it’s “reallocating resources” to AI-focused teams and prioritizing “AI-powered products and capabilities.” It said it’s also reshaping its sales and marketing strategy.

The company said it expects to record pre-tax restructuring charges of about $35 million to $45 million.

Pinterest had more than 4,500 employees globally as of last April, according to its most recent proxy filing.

Pinterest has looked to inject AI throughout its platform to show more personalized and relevant content to users. The company last October released a “Pinterest Assistant” shopping tool.

At the same time, Pinterest has rolled out more automated advertising tools for marketers as it faces increasing competition from TikTok, Meta‘s Facebook and Instagram.

“Our investments in AI and product innovation are paying off,” Pinterest CEO Bill Ready said in November. “We’ve become a leader in visual search and have effectively turned our platform into an AI-powered shopping assistant for 600 million customers.”

Pinterest isn’t the only company downsizing as it invests in AI. AI was cited as the reason for almost 55,000 layoffs in the U.S. last year, according to consulting firm Challenger, Gray & Christmas.

Some experts have questioned whether the technology is the real source of the job reductions, saying some companies could be “AI-washing,” or blaming layoffs on the new technology to cover up cost-cutting efforts or other issues with their businesses.