Analyst: Block's Shift to AI Strategy Could Benefit Square Business the Most

Odaily Financial technology company Block, after reporting strong earnings and advancing its AI transformation strategy, is seen by analysts as positioning its merchant payment business Square to be the primary beneficiary of this strategic shift.

Earnings reports show that Block achieved an operating profit of $485 million in the fourth quarter, with adjusted operating profit reaching $588 million. Net profit attributable to common shareholders was $116 million, and adjusted EBITDA was $930 million. The company also raised its 2026 gross profit guidance to $12.2 billion, representing approximately 18% year-over-year growth.

Block CEO Jack Dorsey recently announced that the company will reduce its workforce by over 40%, cutting total employees from over 10,000 to under 6,000, to drive a leaner, AI-centric operational model. Analysts believe Block is one of the first fintech companies to fundamentally reassess its employee structure and productivity efficiency.

Furthermore, the company recently increased its Bitcoin holdings by 103 BTC. It now holds approximately 8,883 BTC, valued at around $577 million, ranking fourteenth globally among corporate-level Bitcoin holders.

Dorsey stated that the company rapidly expanded its workforce during the pandemic while establishing separate systems for Square and Cash App, leading to personnel redundancy. Block is currently driving organizational integration and plans to increase gross profit per employee to over $2 million, roughly four times the pre-pandemic level. Analysis suggests that in the context of AI-driven efficiency improvements, the Square business is expected to be the first to achieve scalable profit growth.