Block, Inc.

Block reported second-quarter gross profit growth of 25% year over year, adjusted operating income margin of 27%, and adjusted diluted EPS growth of 65% year over year. Square gross profit and GPV both grew 13% year over year, while Cash App gross profit grew 31% year over year; Cash App Commerce Enablement volume grew 17% and Cash App Consumer Lending origination volume grew 59%. For the full year 2026, management now expects gross profit of $12.51 billion, up 21% year over year, adjusted operating income of $3.47 billion, and adjusted diluted EPS growth of 70% year over year. For Q3, Block expects gross profit growth of 18%, adjusted operating income margin of 28%, adjusted diluted EPS growth of 89%, interest expense of $50 million to $55 million, and a mid-20% non-GAAP effective tax rate for both Q3 and the full year.

Jack Dorsey framed the quarter as proof that the post-reorg strategy is working, saying Block is “definitely on track” and pointing to higher shipping velocity as the key proof point. He emphasized that AI tools are helping Block build faster and more cohesively, and that the company is using those tools internally before pushing them out to sellers and Cash App users. He also argued that open-sourcing and building products like Buzz expands learning and contribution rather than limiting monetization.

Amrita Ahuja highlighted broad-based outperformance and record profitability, saying gross profit rose 25% year over year, adjusted diluted EPS rose 65%, and adjusted operating income margin reached 27%. She guided full-year 2026 gross profit to $12.51 billion, adjusted operating income to $3.47 billion, and adjusted diluted EPS growth to 70%, while Q3 guidance calls for 18% gross profit growth and 28% adjusted operating income margin. She also pointed to third-quarter interest expense of $50 million to $55 million, full-year interest expense of $200 million to $210 million, and a mid-20% tax rate; on capital allocation, she said the company plans to keep investing in high-ROI areas such as go-to-market, Neighborhoods, and AI.

Analysts pressed on whether management’s repeated beats reflect conservatism, how Square and Cash App growth should trend in the back half, and how Block plans to manage rising AI and hardware costs. Management said Q3 performance looked consistent with current run rates, but Cash App will face tougher comps, especially from Borrow, even as Square GPV and gross profit continue accelerating. On AI, management said it is model-agnostic, routes workloads intelligently, and uses internal evaluation systems to keep costs in check while preserving developer velocity; on hardware, Thomas Templeton said memory costs are a concern but Block saw the constraint early and has worked to mitigate supply and cost pressure.