Block Inc. is scaling back hiring plans and cutting costs this year, possibly shedding even more real estate, Chief Financial Officer Amrita Ahuja told investors.
Block (NYSE: SQ) opted to not renew its lease for offices in San Francisco’s Mid-Market neighborhood that served as its headquarters before pursuing a no-HQ strategy last year.
“We’ve wound down certain real estate locations on the West Coast. I think you’ll see us make more decisions like this in the future,” Ahuja told those attending the Goldman Sachs Communacopia + Technology Conference in San Francisco Wednesday. Other expenses are also on the chopping block.
“We are pulling back on hiring in a much more meaningful way than we had intended in this year and certainly than in prior years,” said Ahuja, who is also Block’s chief operating officer. “We had intended to grow headcount by about 10%. This year, we believe we’ll come in south of that.”
She credited improvements to Block’s performance management tools and greater focus on key businesses for the reduced hiring.
“We are still investing in certain teams, and we’ll pull back in others,” Ahuga said.
“There are a number of different areas across discretionary spend, where we can get more efficient and still continue to invest in our business in ways that drive growth for our customers and therefore for our business,” Ahuja said, citing potential cost savings tied to software, cloud services, professional fees, travel and entertainment and real estate.
“We’ve already identified incremental efficiency opportunities for this quarter and for the year, and you’ll see us do more of that work,” Ahuja said.
Block, parent of Square, Cash App and Afterpay, also reorganized its sales teams to focus on specific industries.
“Historically, our sales team has been a smaller team that is largely generalist based, so an account executive could have been talking to a beauty salon in the morning or restaurant in the afternoon and a bakery in the evening … and would have been expected to know all of the various needs that each of those different sellers would have,” Ahuja said. “What we are doing now is we’ve created both an inbound and outbound sales team, with account execs who are specialized in each of the verticals to be able to go deep.”
| Rank | Prior Rank | Business name/Prior rank |
|---|---|---|
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1 |
2 |
Visa Inc. |
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2 |
1 |
PayPal |
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3 |
3 |
Intuit Inc. |
