I don’t think people are having a strong enough reaction to the Block news and price action.
If the stock price holds over a number of weeks after this announcement, this is direct feedback from investors incentivizing other companies to do the same. If even just one, or two more companies take similar action, and similar response is received in the stock price, we could see significant changes in the narrative and actions to cut workforce in certain sectors.
AI doomer aside (which I am not as of today), this does seem like a substantial risk to employment IF the stock price of Block holds for a long(ish) period of time.
Curious on others thoughts?
Layoffs Citing AI – Block
byu/HomeMadeToast inwallstreetbets
Posted by HomeMadeToast
40 Comments
It’s literally a failing company using ai as a convenient excuse to lay off dead weight. You’ll see this same playbook a lot until ai hype dies out
On the one hand, I wanna be facetious and say the market has this “priced in”.
The other side of me says….fack, you *may* be onto something here.
I wish AI could come for the housing market instead of the stock market
where the bers at? short this shit into oblivion
it’s a dying company, his message made me laugh so much when his stock is going through the gutter.
corporate greed is at an all time high
It’s AI whitewashing. Their business is clearly having troubles.
investors cheering layoffs as cost-cutting measure is a tale as old as the stock market itself! stocks almost always goes up when a company announces layoffs, its the sad world we live in.
The stock is down by 76% in the last 5 yrs. No, it’s not AI. The company is falling apart.
Didn’t companies already do this all of last year?
High unemployment = increased odds of rate cuts. Death of society, but definitely buying calls.
As anyone who works in a tech company—AI isn’t good enough to lay off 40% of your employees as of now. That’s just insane.
Meanwhile IMF just forecasted more growth and less unemployment… We’re fucked
I wonder who will be the first mover to start taking advantage of this phony AI-as-an-excuse wage suppression tactic
See this is why AI had a bull run.
It was supposed to make workers obsolete, not make obsolete companies lose out to cost efficient alternatives.
Lol, reddit has conditioned you to believe that every decision is based on what a stock might do. I know a few F500 CEO/CFO, they don’t think about the stock price unless they’re giving a report.
I FIRMLY believe that AI is just a scapegoat. They were gonna lay people off anyway. The economy is awful. Downsizing is going to happen. But if we say we’re “modernizing with AI” it might titillate enough shareholders than if we say, “we gotta lay people off because our debt load is too high and we can afford payroll anymore.”
Anthropic said in six months all code will be written by AI but has 50+ Software engineering roles open right now should be everything you need to know.
I was shocked to learn they had over 10,000 employees. I wonder if this is less about AI and more about a struggling company that needs to shed some bloat
This is going to continue to happen as more and more jobs become automated. It is unavoidable and has always been unavoidable. The market is transforming, and good luck picking the winners!
Wait so what were all the layoffs these past few months about?
Thing to remember, AI is an efficiency tool.
You really want more efficiency? You scale your workforce to get even more benefit. It doesn’t replace, it augments the best workers.
So for a company to cut 40% of workforce means there are less people leveraging AI. Sure some positions probably could be downsized thanks to time saving and processes made redundant via AI, not 40%. That’s a gift to the competition.
Not least a bunch of these people WILL go to the competition.
AI is just the excuse IMO
If you could wave a wand and make your employees 40% more efficient, why would you not use that to do 40% more business/rnd/everything and make even more money?
This isn’t an AI layoff. Think about if your company is at huge risk of basically falling behind from AI implementation then a good layoff explanation would be oh yeah we are just integrating ai makes you look a lot better than:
“We realized our company is hugely exposed to other companies replicating our business with AI, and our revenues have been sluggish for the last 5 years”
They’ll cut too deep, laid off talent will pool around new startup companies and use AI effectively to kill their old employers’ companies.
Plenty of fat needs trimming everywhere
It is common to use AI as a way to give a positive spin to layoffs.
More likely reality is they hired too many people relative to their growth opportunity, and they are right-sizing now.
This is classic “SIMPLE JACK” Dorsey overreacting and doing an unhinged pivot to cover his own ineptitude. Look at his track record — no business of his becomes stable. And if there’s one MF who’s gonna jump the gun it’s him..
All we need to do is make the rest of money we will need for the rest of our lives in the next 2-4 years
AI isn’t going to automate 50% of what they’re cutting. In other words, he’s using AI as an excuse to lay off people.
Honestly this is already happening way more than people realize. My cousin works in tech support for a mid-size company and they quietly let go like 30% of their team last quarter, replaced most functions with some AI chatbot system. Stock didn’t even blink, actually went up a bit
The thing is Block being so public about it might actually backfire – when you announce “hey we’re firing people for AI” it makes customers nervous about service quality. Smart companies are doing this quietly, just calling it “restructuring” or whatever. Wall Street loves efficiency but regular people hate the AI replacement narrative
I think we’ll see more of this but companies will get better in hiding the real reasons. The market already rewards cost cutting regardless of how you spin it
Without looking it up tell me what Block does (besides lay people off)
it’s literally a failing company that has horrible leadership and no direction. i was a software engineer there and left last year (voluntarily). they are losing to competition in every space, sr management changes direction every 3-6 months, jack dorsey required everyone in the company to email him every week telling him what they do and then used ai to summarize it…
With deep view inside corporate senior leadership, it is not a risk to employment for skilled people who work hard and seek to better themselves by learning to use new tools.
Those people will be far more productive.
If your plan in life is to “coast”, you are fucked.
Those days are gone.
I agree with many of you. Block is using AI as an excuse after going all in on Block-chain/BTC and failing.
But tomorrow – the sell Software buy Semi’s trade may be back in action. Many are seeing this layoff as a proof of Citrini’s doom fiction.
The stock down 80% in the last 4 years and the market’s reaction to layoffs suggests they had too many employees for quite some time.
– Pre-Covid (2019): 3,835 employees
– Peak (End of 2023): 12,985 employees
– Post-Layoff (2026 Target): Under 6,000 employees
I don’t understand why the stock price goes up on this news. Can someone explain how investors see this and want to put their money in a company that has just had to gut its workforce?
It seems shortsighted
Agreed. Layoffs increased after Elon’s twitter laid off 40% of the workers. When they didn’t notice any service degradation, other companies followed. Sheeeps
I am strongly betting against Block and anything Jack related after this announcement. That’s still the guy who bought Tidal so he could be friends with Jay Z. The implications of what he just did today, for a company which hasn’t been exciting in a very long time, is inexcusable.
I work at a Fortune 100 industrial company. The CEO and CIO talks about AI on social media all day. We use NO AI at all besides Microsoft Copilot, which is a big turd. Then we lay off a ton of people and say it’s because we have increased productivity with AI. Everyone here knows it’s complete bullshit. Bonuses pay out in March and there will be a mass exodus. CEOs are trying to get short term financial gain and sacrifice long term growth. I’ve already sold half of my RSUs and I’m going to exercise my options before June. This AI excuse for layoffs is gonna burn us.