Block Rises 8% on Cash App Profit Surge and Raised Guidance

Block Inc., led by Jack Dorsey, has raised its full-year gross profit forecast following a stronger-than-expected second-quarter performance, driven primarily by the growth of its Cash App lending services and stable payment volumes. The company now anticipates gross profit of $9.96 billion for 2025, up from previous estimates, and the news has sent its shares surging 8% in after-market trading on Thursday in New York [1].

Cash App, the company’s peer-to-peer payment and banking platform, contributed significantly to the improved outlook, reporting $1.50 billion in gross profit for the quarter—a 16% year-over-year increase—surpassing analysts’ expectations of $1.42 billion [2]. The platform’s short-term lending service, Borrow, was highlighted as a key driver, performing better than anticipated and contributing to higher transaction volumes. Card spending also supported its "buy now, pay later" features, which continue to attract both users and merchants [3].

Block’s merchant-focused division, Square, also posted strong results, with gross payment volume (GPV) rising 10% year-over-year to $64.25 billion. Although this fell slightly short of the $66.33 billion forecast, the performance was noted as solid in the context of a challenging macroeconomic environment and subdued consumer spending [1]. Square’s gross profit increased by 11% compared to the same period last year, driven by higher transaction volumes and the growing adoption of value-added services such as the BNPL offering [2].

Operational efficiency is increasingly becoming a focus for Block, with AI tools deployed across product development, fraud detection, and personalized merchant services. These initiatives are expected to reduce costs and boost margins, with CFO Amrita Ahuja stating that revenue growth in the second half of the year does not rely on increasing the active user base [3].

Despite these gains, Block reported an adjusted net profit of $385 million for the second quarter, or 62 cents per share, below the 65 cents forecast by analysts. However, revenue of $6.82 billion matched expectations, and the company’s recent inclusion in the S&P 500 has bolstered investor confidence [1].

CEO Jack Dorsey emphasized the continued focus on Bitcoin, describing it as a unique asset with qualities that no stablecoin can replicate. While he acknowledged the potential for stablecoins in remittances, he reiterated that Block remains committed to making Bitcoin a widely used digital currency [2].

The company’s updated guidance and strong performance in its core platforms have reassured investors that Block is moving toward a more predictable and profitable growth model, particularly following past volatility tied to crypto exposure and user acquisition costs [3].

Source: [1] Block shares gain after strong gross profit growth despite ... (https://ng.investing.com/news/earnings/block-shares-gain-after-strong-gross-profit-growth-despite-eps-miss-2051240)

[2] Earnings live: Eli Lilly stock slides, Pinterest sells off, Expedia ... (https://finance.yahoo.com/news/live/earnings-live-eli-lilly-stock-slides-pinterest-sells-off-expedia-and-block-gain-after-hours-205302959.html)

[3] Block shares jump 8% as cash app fuels higher profit forecast (https://www.cryptopolitan.com/)