Jack Dorsey, the CEO of Block Inc. (NYSE:SQ), has announced a fresh wave of layoffs at the music streaming service Tidal, which Block owns.

What Happened: Dorsey informed Tidal employees on Wednesday that the company will undergo another significant round of layoffs, reported Fortune. The CEO stated that Tidal needs to function "like a startup again," necessitating a much smaller team across the organization.

"So we're going to part ways with a number of folks on our team," Dorsey wrote in the note. "We're going to lead with engineering and design, and remove the product management and product marketing functions entirely. We're reducing the size of our design team and foundational roles supporting TIDAL, and we will consider reducing engineering over the next few weeks as we have more clarity around leadership going forward."

Tidal did not immediately respond to Benzinga's request for comment.

Why It Matters: Block acquired a majority stake in Tidal for approximately $300 million in 2021. The music streaming service, founded by Jay-Z, has struggled to compete with platforms like Spotify and Apple Music.

Earlier in October, Cathie Wood's Ark Invest sold off a significant amount of shares in Block, despite the company's recent positive second-quarter results. This move by Wood, a prominent investor, raised concerns about the future of Block.

However, Block has been making strategic moves in the cryptocurrency space. In August, Dorsey expressed optimism about the potential of the Bitcoin (CRYPTO: BTC) mining chip market, terming it a "massive opportunity" for the company.

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This story was generated using Benzinga Neuro and edited by Kaustubh Bagalkote