Jack Dorsey's Brutal AI Strategy Just Paid Off

Welcome back Jack Dorsey's block making some headlines earlier this year when announced it would lay off 40% of its workforce as it leaned into a I now the company's latest report giving us some insight into that transition. Our Mackenzie sagalos has that story morning Mac. Hey good morning, Carl some block shares getting a nice lift this morning up almost 7% now after what you could call CEO Jack Dorsey's vindication print. This is blocks first major test since Dorsey cut nearly half the company's workforce and told investors that I would let them run leaner faster and more efficiently in this quarter gives bulls real evidence that that's a I reset is starting to work block beat on earnings margins came in stronger than expected cash app revenue ahead of the street on strength in credit products and card spend and then full year outlook moved higher which is especially notable for a company that's usually modest on the guide. But Dorsey's larger message after the bell was that this isn't just about a I replacing workers, a flatter more nimble company just moves faster. We really want a flatter organization and that means that more of our people are closer to our customers and closer to decisions and have a lot more agency to take on the work, especially as the tool harnesses are getting more and more mature and more sophisticated that allows us to make much faster decisions. So Dorsey sounding a lot like Amazon CEO Andy Jassy, they're flattening the org chart clearing out layers of middle management and arguing that a I let's block move faster with fewer people and that is important in a market where plenty of companies are using a I to justify leaner workforces in just the last 24 hours, we have cloud flare cutting 20% of staff bill holding slashing up to 30% of its workforce, both of them citing a I adoption and block is now the proof bulls can point to one quarter after it's a I driven cuts automation is translating into better margins and a stronger outlook guys. Now back a stock is beating the S and P on the year to date and the year on year are really interesting, we'll see if other companies pay attention that's a Mackenzie sagal us.