The "Mad Money" host would go from questioning how Dorsey could run two companies at once to calling him a "part-time CEO," arguing that he should focus on running one company, not two.
"And you know what? I was dead wrong," Cramer said Monday. "Jack Dorsey has been doing a dynamite job at both companies. And because I'm a big believer in accountability, I've gotta tell you: Dorsey deserves a lot more credit than he's been getting."
In a sweeping mea culpa, Cramer admitted that Dorsey has pulled off running two separate, complicated companies at the same time: Twitter, a sprawling social media play, and Square, a tech company trying to disrupt old-line payment systems.
He pointed to their stocks. Just since the start of 2018, shares of Twitter have run 72 percent and shares of Square have gained 77 percent.
But the turnaround stories are even more interesting, Cramer said. Twitter, for one, has gone from a troll-filled website wrought with controversial and hurtful statements to a cleaner, less hateful platform that doubles as the president's sounding board.
"The most objectionable comments now get buried, with the really vile stuff hidden behind a disclaimer," Cramer said, adding that Dorsey also made a point of purging Twitter of millions of fake accounts.
"He did it. He cleaned up the platform. At the same time, Twitter finally figured out monetization, something that many social media companies have struggled with," he continued. "Put it all together, along with some aggressive cost cuts, and Twitter's profitability has improved dramatically. The margins are so much better it's staggering."
While Square has a much more straightforward growth story, Cramer commended its transition from a card-reading device manufacturer to a multifaceted payment services player.
"They even lend money to their clients — why not?" he said. "The payments space has gotten pretty crowded and cutthroat, which is one reason this move into lending was such a good idea. Basically, Square gives its small business clients cash advances in exchange for a flat-rate percentage of their daily credit card sales. This is now a huge growth driver for the company."
Cramer also applauded Dorsey for hiring Goldman Sachs alum Sarah Friar to be Square's chief financial officer, arguing that her work has created serious value for Square's shareholders.
"The lesson here? Not every great CEO needs to be a micro-manager," Cramer said. "As long as your chief executive is making the right big-picture decisions and hiring a good management team, that's what counts."
Lastly, the "Mad Money" host offered Dorsey two pieces of advice.
First, he suggested creating a paid service on Twitter, saying that businesses using the platform as a promotional tool would gladly pay up for some of its extensions like TweetDeck.
"But here's the bottom line on this incredible situation: despite all the doubters, including yours truly, Jack Dorsey has done an amazing job of running both Twitter and Square at the same time," Cramer concluded.
"While I'd be wary of buying either stock at these elevated levels, Dorsey deserves a lot of credit for their monster moves, and even though we were early in getting behind Square and managed to get behind Twitter after talking to [former COO] Anthony Noto, we never apologized to Dorsey for dissing the great work he's done. Congratulations, Jack, on a job well done."
Disclosure: Cramer's charitable trust owns shares of Goldman Sachs.