Block Inc., the financial services firm led by Jack Dorsey, may reduce its workforce by as much as 10% as part of a strategic overhaul, according to a Bloomberg report. This restructuring effort comes during annual performance evaluations, where hundreds of employees have been informed that their roles might be at risk. The company, which had nearly 11,000 employees as of November, is looking to streamline operations and enhance efficiency.
The restructuring aims to create a more cohesive link between Block's peer-to-peer payments service Cash App and its merchant services platform Square. In addition to these changes, Block is also focusing on expanding its newer ventures, such as the Bitcoin mining division Proto and an artificial intelligence initiative known as Goose.
Despite the anticipated layoffs, Block's stock saw a nearly 5% increase last Friday. The company is set to release its quarterly earnings on February 26, with analysts predicting a fourth-quarter profit of $403 million on $6.25 billion in revenue. This follows a third quarter where Block reported a net income of $461.5 million on revenue of $6.11 billion, with gross profit rising by 18% due to significant growth in Cash App and Square.
Bitcoin remains a significant revenue source for Block, having generated approximately $1.97 billion in the third quarter, despite a year-over-year decline from $2.4 billion. As of the end of September, Block held 8,780 BTC valued at over $1 billion, although it recorded a $59 million quarterly valuation loss.
In a move to enhance its payment solutions, Square, a subsidiary of Block, introduced a Bitcoin payment option for merchants last November. This feature allows sellers to accept BTC directly at checkout through Square's point-of-sale systems, with options for Bitcoin-to-Bitcoin transactions and automatic conversion to fiat currency. This development is part of Square's effort to broaden its payment and wallet services, which are utilized by over four million merchants across eight countries.