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Block, Inc. (XYZ)·Q3 2025 Earnings Summary

Executive Summary

  • Q3 2025 delivered strong operational growth but missed Wall Street on revenue and adjusted EPS; gross profit rose 18% YoY to $2.66B, operating income was $409M (15% margin), and adjusted EBITDA was $833M .
  • Versus S&P Global consensus, revenue was $6.115B vs $6.312B estimate (−3.1% miss)* and adjusted EPS was $0.54 vs $0.66 estimate (−18.1% miss); EBITDA (SPGI definition) also missed materially at $498M vs $832M estimate .
  • Guidance increased: FY25 gross profit raised to $10.243B and adjusted operating income to $2.056B; Q4 2025 gross profit guided to $2.755B and AOI to $560M, signaling continued acceleration .
  • Stock-relevant catalysts: Square GPV acceleration to 12% YoY, Cash App gross profit per active up 25% YoY to $94, 58M monthly actives, and ecosystem expansions (Square Bitcoin payments, Grubhub integration) .

What Went Well and What Went Wrong

What Went Well

  • Square GPV growth accelerated to 12% YoY (U.S. +8.9%, International +26% CC), with strength in food & beverage (+17%) and retail (+12%) .
  • Cash App engagement metrics improved: gross profit per monthly transacting active reached $94 (+25% YoY); primary banking actives rose 18% YoY to 8.3M .
  • Management raised FY and Q4 guidance on the back of execution: “We are raising our fourth quarter and full-year guidance to reflect our strong execution” .

What Went Wrong

  • Profitability headwinds from lending expansion: transaction, loan, and consumer receivable losses increased 89% YoY, driven primarily by Cash App Borrow growth (+134% YoY originations) .
  • Elevated sales and marketing spend up 17% YoY (Square go-to-market ramp), compressing adjusted operating margin to 18% from 22% in Q2 .
  • Revenue and adjusted EPS missed consensus (see Estimates Context), likely reflecting bitcoin revenue decline YoY ($1.97B vs $2.43B) and heavier investment pacing .

Financial Results

MetricQ3 2024Q2 2025Q3 2025
Revenue ($USD Millions)5,975.801 6,054.457 6,114.952
Gross Profit ($USD Millions)2,249.685 2,536.530 2,661.570
Operating Income ($USD Millions)323.009 484.293 409.440
Operating Income Margin (% of Gross Profit)14% 19% 15%
Diluted EPS ($USD, GAAP)0.45 0.87 0.74
Adjusted Diluted EPS ($USD, non-GAAP)0.53 0.62 0.54
Adjusted EBITDA ($USD Millions)807.472 891.422 832.662

Segment performance and volume

Segment/VolumeQ3 2024Q3 2025
Cash App Revenue ($USD Millions)3,929.573 3,799.501
Cash App Gross Profit ($USD Millions)1,305.943 1,623.953
Square Revenue ($USD Millions)2,001.737 2,240.846
Square Gross Profit ($USD Millions)932.356 1,017.660
Square GPV ($USD Millions)59,873 67,151

Key KPIs

KPIQ3 2024Q2 2025Q3 2025
Cash App Monthly Transacting Actives (M)57 57 58
Gross Profit per Monthly Transacting Active ($)76 87 94
Inflows per Transacting Active ($)1,255 1,338 1,366
Monetization Rate (%)1.51% 1.62% 1.72%
Cash App Card Monthly Actives (M)25 26 26
BNPL GMV ($USD Billions)9.70 (Q3’25) — 9.11 9.70
BNPL Gross Profit ($USD Millions)299 (Q3’25) — 268 299

Guidance Changes

MetricPeriodPrevious GuidanceCurrent GuidanceChange
Gross Profit ($USD Billions)FY 2025$10.17B (Q2 letter) $10.243B Raised
Adjusted Operating Income ($USD Billions)FY 2025$2.03B (Q2 letter) $2.056B Raised
Gross Profit ($USD Billions)Q4 2025Not provided in Q2; implied acceleration $2.755B Raised/Added
Adjusted Operating Income ($USD Millions)Q4 2025Not provided in Q2; implied margin ~20% $560M Raised/Added

Note: Q1 2025 guidance was $9.96B gross profit and $1.90B AOI, subsequently raised in Q2 and again in Q3 .

Earnings Call Themes & Trends

TopicPrevious Mentions (Q1 2025)Previous Mentions (Q2 2025)Current Period (Q3 2025)Trend
AI/Technology initiativesCompany-wide agentic systems (goose/MCP) to accelerate shipping; aim for “personal CFO/COO” interfaces by year-end Square AI launched; seller insights via conversational interface; initial adoption and feature expansion Expanded AI voice ordering, Order Guide procurement tool, local data insights; Square AI answering hundreds of thousands of seller questions Accelerating
Cash App Borrow & LendingFDIC approval to originate nationwide; plan to expand Borrow and evolve terms to increase limits and unit economics Borrow originations +95% YoY (annualized), scaling banking engagement; AOI margin expansion Borrow originations +134% YoY; annualized net margins 24% with stable risk loss; primary banking actives +18% YoY Scaling with disciplined risk
Square go-to-marketBuilding field sales, partnerships; broaden ISO channels; upmarket wins Increased field/telesales, strong ROI; Live Nation Canada, mid-market acceleration 90 field sales reps; brand campaign; simplified pricing; continued upmarket wins (Katz’s Deli, Purdys) Expanding/investing
Ecosystem connectivityLinking Cash App with sellers (Cash Local); teen engagement strategy Cash App Pay growth 2x; adding merchants; Afterpay Media Network launches Neighborhoods on Cash App; network rewards; 1% in-app processing rate supported by inflows; Square Bitcoin rollout Deepening connectivity
Macro, tariffs/regulatoryMore cautious macro stance in guidance; risk/regulatory considerations highlighted Continued mindful macro backdrop; safe harbor reiterations Safe harbor reiterations; bitcoin services availability limits (NY, outside U.S.) Neutral/cautious

Management Commentary

  • “We had another strong quarter delivering for our customers with high quality and high velocity.” (Shareholder Letter, Q3 2025) .
  • “Our vertically integrated platform allows us to move quickly, and we believe it gives us unique advantages in launching AI tools for sellers.” .
  • “We are raising our fourth quarter and full-year guidance to reflect our strong execution.” .
  • “We believe we are the only company that can serve every seller in every neighborhood around the world.” .

Q&A Highlights

  • The Q3 2025 earnings call transcript was not available in our document set; no Q&A highlights could be reviewed .

Estimates Context

MetricConsensus (S&P Global)ActualSurprise (%)
Revenue ($USD Millions)6,311.882*6,114.952 −3.1%*
Primary EPS (Adjusted Diluted) ($)0.6593*0.54 −18.1%*
EBITDA ($USD Millions)832.422*498.402*−40.2%*
Adjusted EBITDA ($USD Millions)—832.662 —

Values retrieved from S&P Global. The company’s Adjusted EBITDA ($833M) is non-GAAP and not directly comparable to SPGI-defined EBITDA; consensus comparisons above use SPGI definitions.

Where estimates may need to adjust:

  • Upward revisions likely to FY25 gross profit and AOI given raised guidance and Q4 acceleration outlook .
  • Near-term EPS/EBITDA consensus may require recalibration for higher credit loss provisioning and increased go-to-market investments, offset by Square GPV strength and Cash App engagement improvements .

Key Takeaways for Investors

  • Execution strong with GPV and engagement tailwinds; Square GPV +12% YoY and Cash App gross profit per active +25% YoY should sustain topline momentum into Q4 .
  • Profitability trade-offs: Borrow scaling and marketing ramp are accretive to ecosystem depth but increase loss provisioning and compress near-term margins; watch AOI margin trajectory vs guidance .
  • Guidance raised twice year-to-date; Q4 targets indicate >19% YoY gross profit growth and 20% AOI margin—credible acceleration setup .
  • Ecosystem expansions (Square Bitcoin, Grubhub integration) enhance seller value and consumer connectivity; potential multiple catalysts for narrative and adoption .
  • Estimate dispersion likely to widen on definitional differences (EBITDA vs Adjusted EBITDA) and lending dynamics; anchor comparisons to defined non-GAAP metrics where management guides .
  • Near-term trading: Negative surprise vs consensus on revenue/EPS may weigh initially; however, the guidance raise and clear Q4 acceleration path are supportive as estimates reset .
  • Medium-term thesis: Vertically integrated platform, AI leverage, and banked consumer base create durable growth optionality across Square and Cash App with improving operating leverage as investments normalize .