Jack Dorsey's Block Inc. began notifying hundreds of employees during annual performance reviews that their roles could be eliminated as the payments firm executes a broader business overhaul.
Up to 10% of the company's workforce faces potential cuts, affecting as many as 1,100 employees from a base of fewer than 11,000 people as of late November.
The restructuring comes ahead of Block's February 26 earnings report, where analysts expect adjusted profit of $403 million on revenue of roughly $6.25 billion for the fourth quarter.
The company is working to integrate Cash App more closely with Square while expanding newer initiatives including Bitcoin (BTC) mining division Proto and AI project Goose.
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Mixed Third Quarter Performance
Block reported third-quarter net income of $461.5 million on $6.11 billion in revenue, with gross profit rising 18% year-over-year driven by 24% Cash App growth and 9% Square growth.
The stock fell after the release as adjusted operating income of $409 million missed consensus estimates of $473 million.
Bitcoin generated $1.97 billion in Q3 revenue, down from $2.4 billion a year earlier but still representing the company's second-largest revenue stream. Block held 8,780 Bitcoin worth over $1 billion by September's end, recording a $59 million quarterly valuation loss.
Centralized exchange trading volumes dropped 9% quarter-over-quarter after October's liquidation event, contributing to the 35% decline in Coinbase shares that Block identified as a drag on its business.
Payment Product Launches
Square launched Bitcoin payments on November 10, allowing merchants to accept cryptocurrency directly at checkout through point-of-sale terminals with zero processing fees through 2026.
The Lightning Network-powered feature reaches more than 4 million sellers across eight countries.
Merchants can process transactions as Bitcoin-to-Bitcoin or automatically convert between Bitcoin and fiat currency. The launch added to earlier tools that let merchants convert a portion of daily card sales into Bitcoin as part of Square's payment ecosystem.
Block shares rose 4.85% Friday to close at $55.97, though the stock remains under pressure from persistent economic uncertainty and intensifying competition in the payments sector.
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