Block, the parent company of Square, Afterpay, CashApp and Tiday, recently announced plans to implement major workforce-rending restructuring moves. The decision involves laying off nearly 1,000 employees, alongside adjustments in managerial roles and a halt on open job positions. The motivation behind the reorganization is to give Block’s various businesses more focus and to enhance operational execution, with the long-term goal of raising its stock price.
The company’s revenue and profit growth has frozen during the past year, adding to a tough fiscal environment. Just this year alone, Block’s stock has fallen by 29%. Despite these challenges, the company is not targeting specific financial metrics or looking to replace jobs with AI through this restructuring. Rather, it’s about building the company’s strategic muscle.
Surge has grown Block’s workforce—prior to these layoffs, there were over 12,000 people working for Block—with over 930 employees at Block impacted by the upcoming layoffs. Further, over 200 managers will be moving into non-classified positions. In an effort to increase efficiency, nearly 800 current vacancies will be eliminated. These changes are aligned with a larger, company-wide initiative to stay within the company’s headcount cap, while maximizing operational efficiency.
Block runs an array of payment platforms. These are all part of payment services company Square, which owns Afterpay, the money transfer app CashApp and the music streaming service Tidal. Even with such a diverse and rich portfolio, the company still wants to focus their resources more and drive their stock price up with this structural change.