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Block, Inc. (XYZ)·Q2 2025 Earnings Summary

Executive Summary

  • Q2 2025 delivered strong profitability and execution: gross profit $2.54B (+14% YoY), operating income $484M (19% of gross profit), Adjusted Operating Income $550M (22% margin), Adjusted EBITDA $891M .
  • Topline missed Street: revenue $6.05B vs consensus $6.29B* and Primary EPS $0.62 vs $0.66*; however gross profit outperformed prior guidance ($2.45B guided in Q1) and margins expanded materially .
  • Guidance raised: FY2025 gross profit to $10.17B (from $9.96B), AOI to $2.03B (from $1.90B); Q3 2025 outlook calls for gross profit $2.60B and AOI margin 18% .
  • Catalysts: accelerating Cash App Borrow and BNPL, Square GPV momentum (U.S. +7%, International +25%), product velocity (Cash App Pools, Square AI) and capital allocation (repurchased $692M, upsized $2.2B senior notes) .

What Went Well and What Went Wrong

What Went Well

  • “We’re back on offense” with accelerated shipping velocity (Cash App Pools rolled out four months after development) and raised FY guidance, signaling confidence in H2 growth drivers .
  • Square GPV grew 10% YoY (U.S. +7%, International +25%), with strength in food & beverage (+15%) and the strongest retail GPV growth since Q1 2023 (+10%) .
  • Cash App gross profit +16% YoY; engagement improved: gross profit per monthly transacting active rose to $87 (+15% YoY), monetization rate to 1.62%, and Cash App Card actives reached 26M .

What Went Wrong

  • Revenue and Primary EPS came in below consensus (revenue $6.05B vs $6.29B*; Primary EPS $0.62 vs $0.66*), driven in part by lower bitcoin revenue YoY ($2.14B vs $2.61B) dampening total net revenue .
  • Transaction, loan, and consumer receivable losses rose 53% YoY, reflecting growth in lending volumes, particularly Cash App Borrow—an execution and underwriting area to monitor .
  • Q1 context showed consumer spending softness and product controls that unintentionally disrupted good customers; while refined, this highlights sensitivity to macro and risk systems tuning .

Financial Results

Multi-period performance vs prior quarter and prior year

MetricQ2 2024Q1 2025Q2 2025
Revenue ($USD Billions)$6.156 $5.772 $6.054
GAAP Diluted EPS ($)$0.31 $0.30 $0.87
Adjusted Diluted EPS ($)$0.47 $0.56 $0.62
Operating Income Margin (% of Gross Profit)14% 14% 19%
Net Income Margin (% of Gross Profit)9% 8% 21%
Adjusted EBITDA Margin (%)34% 35% 35%

Actual vs Wall Street estimates (S&P Global)

MetricQ2 2025 ActualQ2 2025 Consensus# of Estimates
Revenue ($USD Billions)$6.054 $6.293*27*
EPS (Primary, $)$0.62 $0.66*31*

Values retrieved from S&P Global.

Segment breakdown

SegmentQ2 2024 Revenue ($USD Millions)Q2 2024 Gross Profit ($USD Millions)Q2 2025 Revenue ($USD Millions)Q2 2025 Gross Profit ($USD Millions)
Cash App$4,128.8 $1,298.9 $3,844.9 $1,500.5
Square$1,979.5 $922.6 $2,166.3 $1,026.8
Total (incl. Corporate & Other)$6,155.6 $2,233.5 $6,054.5 $2,536.5

KPIs

KPIQ2 2024Q1 2025Q2 2025
Square GPV ($USD Billions)$58.37 $54.10 $64.25
Cash App Monthly Transacting Actives (M)57 57 57
Cash App Card Monthly Transacting Actives (M)24 25 26
Inflows per Transacting Active ($)$1,243 $1,355 $1,338
Monetization Rate (%)1.53% 1.49% 1.62%
Gross Profit per Monthly Transacting Active ($)$76 $81 $87
BNPL GMV ($USD Billions)$—$7.89 $9.11
BNPL Gross Profit ($USD Millions)$220 (annualized basis reference) $237 $268

Guidance Changes

MetricPeriodPrevious GuidanceCurrent GuidanceChange
Gross Profit ($)FY 2025$9.96B $10.17B Raised
Adjusted Operating Income ($)FY 2025$1.90B $2.03B Raised
Adjusted Operating Income Margin (%)FY 202519% 20% Raised
Gross Profit ($)Q3 2025“Low double-digit YoY growth” (qualitative) $2.60B; +16% YoY Raised/quantified
Adjusted Operating Income ($)Q3 2025N/A$460M; 18% margin New detail
Non-GAAP Effective Tax RateFY 2025Mid-20% (context from FY24 outlook) Mid-20% (unchanged context) Maintained

Earnings Call Themes & Trends

Note: A full Q2 2025 earnings call transcript was not available in the document set; themes below reflect shareholder letters and outlook commentary.

TopicPrevious Mentions (Q4 2024 and Q1 2025)Current Period (Q2 2025)Trend
AI/Technology initiativesIntroduced “codename goose” agent; plan to automate workflows and integrate into consumer/seller interfaces; seasonal product release cadence Launched Square AI in Dashboard to deliver data-driven insights; continued emphasis on agentic systems Expanding deployment
Product performance (Cash App)Afterpay integrated with Cash App Card; plans to expand Borrow; brand campaigns to drive inflows Rolled out Pools; Cash App Pay volume doubled YoY; growing Cash App Card actives; BNPL GMV +17% YoY Accelerating engagement
Regional trends (Square)Q1: U.S. GPV +5.6%, International +15% (CC +21%) Q2: U.S. GPV +7%, International +25% (CC +24%) Broad-based acceleration
Regulatory/legalResolved CFPB and most state matters; ongoing NYDFS dialog Safe harbor notes; bitcoin payments not anticipated for NY sellers initially Stabilizing with constraints
Macro/tariffsMore cautious macro stance in Q1 guidance “Mindful of dynamic macro backdrop” in FY/Q3 outlook Cautious
R&D execution/shipping velocity>100 Square product launches (May 13 event); functional org to ship faster Pools moved from prototype to pilot in 4 months; Tap to Pay for Cash App Business Speeding up

Management Commentary

  • “We’re back on offense…Cash App gross profit grew 16% year over year…our shipping velocity has accelerated and I’m confident in our ability to sustain strong growth at scale.” — Shareholder Letter .
  • “In the second quarter, Square GPV grew 10% year over year…we observed notable strength in food and beverage and retail.” — Shareholder Letter .
  • “We are raising our guidance…now expect $10.17 billion in gross profit for 2025…Adjusted Operating Income of $2.03 billion, or 20% margin.” — Shareholder Letter .
  • “In the second quarter, Cash App’s gross profit per monthly transacting active grew 15% year over year to $87…we drove Borrow and BNPL attach rates higher while expanding Cash App Card actives to 26 million.” — Shareholder Letter .
  • “In the second quarter, we launched Square AI…powered by Square data, this tool…helps sellers work smarter and faster.” — Shareholder Letter .

Q&A Highlights

  • A full Q2 2025 earnings call transcript was not available in the document set. Management hosted the webcast at 2:00 p.m. PT on August 7; a replay is available on the IR site .
  • Guidance clarifications and H2 drivers were addressed in the shareholder letter (Borrow, BNPL, Square GPV initiatives, Proto chip deliveries) .

Estimates Context

  • Revenue and EPS missed Street: revenue $6.05B vs $6.29B* and Primary EPS $0.62 vs $0.66*; total net revenue was pressured by lower bitcoin revenue YoY ($2.14B vs $2.61B) even as gross profit rose 14% YoY .
  • Gross profit outperformed the Q1 guide ($2.45B guided vs $2.54B actual), with AOI margin expansion (22% vs 20% in Q1) signaling operating leverage .
    Values retrieved from S&P Global.

Key Takeaways for Investors

  • Guidance raise and margin expansion are key near‑term positives; FY2025 gross profit increased to $10.17B and AOI to $2.03B with Q3 gross profit guided to $2.60B and 18% AOI margin .
  • Square momentum is broad-based and accelerating (U.S. +7%, International +25%, food & beverage +15%, retail strongest since Q1 2023), supporting GPV and mix improvements .
  • Cash App engagement and monetization improving (gross profit/active $87, monetization 1.62%, Card actives 26M), with BNPL GMV +17% YoY and Borrow expansion expected to be a meaningful H2 growth driver .
  • Watch credit performance: transaction/loan/consumer receivable losses +53% YoY as lending scales; underwriting discipline and risk loss trends are critical for sustainable Borrow economics .
  • Capital allocation and balance sheet actions: $692M repurchases in Q2 with $1.5B remaining authorization; upsized $2.2B senior notes provide flexibility for debt management and investments .
  • Index inclusion may broaden investor base and liquidity: “Block set to join the S&P 500” effective July 23, 2025 .
  • Tactical implication: Despite a top-line miss vs estimates, strong gross profit beat and raised guide shift focus to H2 acceleration; near-term stock moves likely hinge on confidence in Borrow-led growth and Square upmarket execution .