Good day, ladies and gentlemen, and welcome to the Block third quarter 2025 earnings conference call. These forward-looking statements include discussions of our outlook, strategy, and guidance, as well as our long-term targets and goals. Also note that the forward-looking statements, including earnings guidance for 2025 discussed on this call, are based on information available to us and assumptions we believe are reasonable as of today's date. With Rule of 40, we are evaluating the sum of our gross profit growth and adjusted operating income margin.

Gross profit grew 18% year-over-year to $2.66 billion, accelerating from 14% growth last quarter, driven by Cash-up. Adjusted operating income was $480 million, showing strong profitability even in a quarter where we leaned into investments to drive long-term growth. Cash-up's 24% year-over-year gross profit growth in the third quarter accelerated from 16% in the second quarter. Our focus on re-accelerating active growth and increasing network density is working, as we reached 58 million monthly actives in September.

This growth was driven by improvements in experiences across the app, including onboarding, referrals, and core payment flows, reducing friction while boosting engagement and retention. Cash-up's gross profit per monthly transacting active grew 25% year-over-year to $94. Primary banking actives grew 18% year-over-year to 8.3 million, up from 8 million in the second quarter. Turning to Square, gross profit grew 9% year-over-year in the third quarter, and GPV grew 12%, with an acceleration of growth in both the U.S.

What went well
  • Block delivered a strong quarter, with gross profit up 18% year-over-year to $2.66 billion, accelerating from 14% growth the prior quarter.
  • Cash App gross profit grew 24% year-over-year, accelerating from 16% in the second quarter, as monthly actives reached 58 million in September and gross profit per monthly transacting active rose 25% to $94.
  • Cash App Borrow originations grew 134% year-over-year to nearly $22 billion annualized while keeping risk loss below the 3% target and delivering annualized net margins of about 24%.
  • Square gross profit grew 9% and GPV grew 12%, with notable up-market strength as GPV from sellers above $500K grew 20% year-over-year, the strongest rate for those sellers since Q1 2023.
  • Adjusted EBITDA was $833 million and adjusted operating income was $480 million, with the company raising full-year guidance and expecting to approach Rule of 40 heading into 2026.
  • The company repurchased approximately $1.5 billion of stock through September and generated first revenue from its Proto Bitcoin mining business.
What went wrong
  • A decision to increase operational flexibility at a processing partner created an approximately 2.6 percentage point headwind to Square gross profit, which the company expects to lap in Q2 2026.
  • Transaction, loan, and risk loss expense grew 89% year-over-year as the company invested in scaling lending products such as Borrow and post-purchase BNPL.
  • GPV growth slowed slightly toward the end of October, which management attributed primarily to weather.
  • The buy now, pay later business saw isolated impacts from tariffs and de minimis tax exemption changes, though GMV growth remained strong at 17%.

Guidance Changes

MetricPeriodCurrent guidance
Gross profitQ4 2025$2.755 billion (over 19% YoY growth) (raised)
Adjusted operating incomeQ4 2025$560 million (20% margin) (raised)
Gross profitFull year 2025$10.243 billion (more than 15% YoY growth) (raised)
Adjusted operating incomeFull year 2025$2.056 billion (nearly 28% YoY growth) (raised)
Net interest expenseQ4 2025$45 million (new)
Tax rate2025 and long termmid-20% range (new)

Performance Breakdown

MetricYoYNote
Total gross profit +18% Acceleration driven by Cash App, with broad-based contribution across network, banking, commerce, and Bitcoin products.
Cash App Borrow originations +134% Core underwriting model improvements deployed across new and existing states, nationwide expansion via the SFS bank migration, and refined limits for engaged customers.
Square GPV +12% Profitable market share gains in target verticals such as food and beverage, with larger sellers and international markets; U.S. and international both accelerated.
International GPV +26% Particular strength in the telesales channel across global markets.
Transaction, loan, and risk loss expense +89% Investment in scaling lending products, most notably Borrow and the recent launch of post-purchase BNPL.
Afterpay GMV +18% (constant currency) Growth led by post-purchase Afterpay on the Cash App card, with gross profit up 23%.

Earnings Call Themes & Trends

TopicPrevious mentionCurrent periodTrend
Cash App active and engagement growthNetwork density declared a top priority earlier in the yearReached 58 million monthly actives in September with continued acceleration in October, driven by network enhancements, multiplayer money (pools), and teens/familyAccelerating
Cash App Borrow and lendingMajority of Borrow originations shifted to SFS bank last quarterOriginations up 134% with healthy losses and strong second-order engagement lifts across the ecosystemExpanding
Field sales and go-to-market for SquareStarted the year with next to no ramped field repsNow over 100 field reps with sales-led NVA up 28% year to date and expected to exceed 40% in Q4Scaling
AI across the companyStarted Goose about two years ago to automate engineering testsGoose now used across nearly every role, powering Square AI and soon Cash App AI; seen as both a growth driver and cost reducerExpanding
Bitcoin / Proto and Square Bitcoin acceptance—Proto generated first revenue selling mining hardware; Square Bitcoin payments acceptance launching to all sellers the following weekEmerging

Q&A Summary

Where does Cash App network density stand and when might we see an inflection in network growth?
September reached 58 million monthly actives with accelerating year-over-year growth that continued in October; growth comes from new acquisition plus engagement, with focus on network enhancements, multiplayer money (1.5 million pools by end of October), and teens and family (5 million monthly active teens).
How productive are the field sales teams and what is their contribution profile relative to GPV and gross profit?
Field is performing well with healthy paybacks, scaling from near zero ramped reps to over 100; management focuses on maximizing variable profit dollars per head rather than gross profit to GPV ratio, while 70% of NVA still comes from self-onboarding sellers.
Why are Borrow and BNPL good businesses despite investor concern about credit quality?
These products expand credit access to underserved consumers with strong product-market fit; Q3 originations grew 134% with losses below the 3% target and roughly 24% net margins, and Borrow actives show three times higher inflows and retention, powered by Cash App's proprietary credit score.
What is driving Cash App gross profit acceleration beyond the Borrow year-over-year comp?
The ecosystem as a whole, with card GPV up 19%, Cash App Pay GPV up 70%, and growth across banking, commerce, and Bitcoin; management does not view results ex-Borrow, citing Borrow's roughly 30% return on invested capital and strong second-order ecosystem effects.
Given a tricky macro, what visibility informs the Q4 guide and consumer spend?
Guidance is informed by Q3 performance and October trends, both of which were strong; isolated tariff and de minimis impacts appeared in BNPL but did not change the macro read, with Square seeing slightly slower late-October GPV attributed to weather.
Is new Square volume coming from non-cloud sellers or from other cloud providers, and have pricing dynamics changed?
No major payment pricing moves were made; wins come from showing up in more conversations via field sales expansion, the lowest churn since Q2 2023, and win-backs from direct competitors, alongside a simplified three-tier software pricing structure.

More on Block, Inc.

Reported 2025-11-06 · figures from the Block, Inc. Q3 2025 earnings call.

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