Employees at Block, Inc. (NYSE:SQ), the fintech company led by Jack Dorsey, have been reportedly directed not to discuss board member and rapper Shawn Carter, better known as Jay-Z.
What Happened: Block employees were given “stern warnings” by management against mentioning Jay-Z on internal company forums. The rationale behind this directive is yet to be clarified, reported Fortune, citing three employees.
The directive to avoid mentioning Carter was given last month.
This occurred around the same time when some employees began questioning Carter’s position on Block’s board.
This was due to the rapper’s long-standing friendship with rapper and entrepreneur Sean “Diddy” Combs, who is currently in prison awaiting trial on serious charges.
After issuing the warning about discussing Carter, Dorsey conducted a virtual all-hands meeting, during which he reportedly disabled the option for employees to ask questions anonymously.
Block laid off several employees from music streaming service Tidal’s staff last week, with more cuts anticipated across other Block entities, including Square and CashApp.
Layoffs also took place at Square and TBD, Block’s developer platform, which is now slated for closure, the report noted.
Why It Matters: In 2021, CEO Dorsey’s Block secured a controlling interest in the Tidal, which Carter owned. Dorsey and Carter are reported to have a close personal friendship.
In the same year, Dorsey and Jay-Z launched a Bitcoin-focused non-profit aimed at advancing the cryptocurrency, with an initial focus on Africa and India.
They contributed 500 BTC to support the initiative. At the time, Bitcoin was priced at $47,504, so a $1,000 investment would have bought 0.021 BTC.
The directive against discussing Carter comes at a time when Block is facing significant challenges. The company’s shares took a hit after mixed third-quarter results reported after Thursday’s closing bell.
Block reported quarterly earnings of 88 cents per share, surpassing the analyst consensus of 87 cents.
However, its quarterly revenue totaled $5.97 billion, falling short of the expected $6.24 billion, though it represents an increase from $5.617 billion in sales during the same period last year.
Price Action: Block’s shares closed Friday’s trading down 0.94% at $74.56. In after-hours trading, the stock dropped further, reaching $74 at the time of writing, according to Benzinga Pro.
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Disclaimer: This content was partially produced with the help of Benzinga Neuro and was reviewed and published by Benzinga editors.
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