Block (NYSE: XYZ) shares climbed more than 4% in after-hours trading on Tuesday after the payments company reported second-quarter results that topped Wall Street expectations and raised its full-year profit outlook. Adjusted earnings reached $1.02 per share for the three months ended June 30, easily beating the consensus estimate of 87 cents from analysts polled by London Stock Exchange Group (LSE: LSEG). Revenue came in at $6.62 billion, above the forecast of $6.49 billion.
The company, led by Jack Dorsey, now expects 2026 gross profit of $12.51 billion, implying 21% growth from the previous year, up from the prior target of $12.33 billion (19% growth). The upbeat forecast reflects confidence in sustained consumer spending and continued momentum at Cash App, Block’s consumer financial services platform.
Cash App Drives Growth: Cash App generated a 31% jump in gross profit during the quarter, significantly outpacing the 13% growth at the Square merchant business. User engagement surged: Primary Banking Actives rose 17%, Cash App Commerce Enablement volume increased 17%, and consumer lending originations soared 59%, fueled by Cash App Borrow. Square’s total gross payment volume grew 13% year-over-year, with U.S. GPV up 10%—the fastest domestic pace since Q2 2023—and international GPV rising 28%.
Bitcoin Activity Disclosure: Block provided an early estimate for Cash App’s Bitcoin Ecosystem revenue of $1.8 billion, which primarily reflects the dollar value of bitcoin purchased by customers. The company also expects an $88.5 million accounting loss from revaluing its bitcoin investment using the June 30 closing price, though this non-cash charge only impacts GAAP earnings and does not affect adjusted operating figures. Block emphasized that bitcoin trading can cause significant variability in reported revenue and net income, but historically has a modest impact on gross profit and adjusted operating income.
Efficiency and AI Push: Block has been aggressively cutting costs. In February, it announced plans to eliminate more than 50% of jobs as part of a restructuring that embeds artificial intelligence across operations. CEO Jack Dorsey stated, “Intelligence tools are the next major technology shift, but machine learning is not new to Block.” The second-quarter results gave the company room to continue the overhaul; adjusted operating income margin hit a record 27%, and adjusted diluted earnings per share jumped 65% year-over-year.
The strong quarter and raised guidance extended a solid earnings season for U.S. payment companies, suggesting that transaction volumes remain resilient even as households navigate elevated borrowing costs and economic uncertainty.
