Jack Dorsey Throws 4,000 People to the “Block," Netflix Keeps Its Wallet Holstered

Hey there Folks,

In tonight’s edition, we’ve got Jack Dorsey channeling Lord Farquaad while promoting Claudebot to “Elite Employee,” investors falling in love with severance math, and Netflix avoiding a $111B nostalgia museum courtesy of Hollywood’s richest nepobaby.

Let’s get started…

-“Some of you may die, but that’s a sacrifice I’m willing to make…” -Jack Dorsey, shortly before sending out a 2-word mass email to employees

Apparently the fastest way to add $10 billion in market cap these days… is to fire half your workforce and whisper “AI” into the earnings call microphone.

Block shares catapulted as much as 24% after the Square-maker announced it’s laying off more than 4,000 employees… nearly HALF its headcount.

And this is just the beginning… Jack Dorsey (yes, the barefoot philosopher king of Twitter lore) told shareholders his main goal is to whittle Block from over 10,000 employees to just under 6,000.

Translation: Claudebot (via iMac Mini), you have been promoted… you are now my elite employee.

According to CFO Amrita Ahuja, the cuts will allow Block “to move faster with smaller, highly talented teams using AI to automate more work.”

Now despite shares being down 76% since 2021, Dorsey insists this isn’t about weakness (sure, Jan). The business is “strong.” Gross profit jumped 24% year-over-year to $2.87 billion. Adjusted EPS landed right in line.

So naturally, Wall Street responded by losing their pants.

Because in 2026, growth + AI + fewer humans = chef’s kiss.

The restructuring will cost roughly $450M to $500M in charges, mostly severance, with the bulk hitting Q1. But investors don’t care. They hear “automation” and suddenly the “stonk only go up” narrative is strong with this one.

And let’s be honest… this is literally everyone’s MO right now. Pinterest. CrowdStrike. Chegg. Amazon. Meta. Microsoft. Verizon.

Any job that doesn’t require a real high-value skill? Getting replaced by a robot.

The message from Silicon Valley is getting louder: If a significantly smaller team can do more using intelligence tools… why wouldn’t you?

Matt Walsh and a few podcasters can rant about humans automating themselves out of relevance (and to be fair, he’s got a point).

But it doesn’t really matter. The train has already left the station and the conductor is an AI bot.

In 2026, Wall Street doesn’t reward companies for hiring talent (unless you’re Zuck). It rewards them for replacing it.

And if any of your friends claim AI is a hoax… maybe send them this.

-Netflix just looked at a $111 billion bar tab… and said, “Yeah, we’re good.”

After months of Hollywood chest-thumping, White House field trips, and fighting against the world’s biggest nepobaby (read: David Ellison)... Netflix officially walked away from its deal for Warner Bros. Discovery.

Why?

It’s actually pretty simple… because Paramount Skydance rolled up with a bigger suitcase of cash.

Earlier this week, Paramount bumped its all-cash offer to $31 per share for the entire WBD empire… studio, HBO, CNN, TNT, the whole cable-TV fossil collection. That topped Netflix’s $27.75 per share bid for just the studio and streaming assets.

And here’s the “holy overpay” insanity of it all… Paramount agreed to pay a $2.8B breakup fee WBD would owe Netflix, slap a $7B termination fee on itself if regulators block the deal, and line up $57.5B in committed debt financing.

Translation: “We’re not bluffing. Here’s the money. And the backup money.”

And despite the Twitter narrative, this wasn’t some buzzer-beater miracle… Netflix had four business days to counter. Ninety-six hours to come back with a higher number.

They didn’t.

Ted Sarandos and Greg Peters essentially said: “Cool company. Love the brands. Not at that price.”

Wall Street loved that grown-up energy. Netflix shares popped 10%. Warner Bros dipped (-1%). Paramount gained 6%.

Every Netflix shareholder exhaled like they just avoided buying a timeshare in 2007.

Ironically, this bidding war had more plot twists than the final season of anything HBO produced.

Ellison (armed with his dad’s yacht money) spent months escalating bids, threatening proxy fights, and turning this into a political photo-op circus. Headlines dropped daily without anything actually happening — to the point I stopped covering it until something real occurred.

That day was today.

But in the end? Discipline won. Netflix reminded everyone this was a “nice-to-have”… not a “must-have.”

They’re already spending $20B this year on content. They’ve got 325+ million subscribers globally. Investors clearly preferred “stick to your lane” over “YOLO $82 billion on Game of Thrones and Batman.”

As for Paramount, the Ellisons now get one of Hollywood’s biggest libraries under one roof. Regulators could still throw a wrench in it.

But for now? Netflix just proved that sometimes the biggest flex in M&A…

Is walking away.

Larry Ellison could never…

The Team at Bullseye Trades