Block, Inc.
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ITEM 1. BUSINESS
Our Purpose
At Block, Inc. (together with its subsidiaries, "Block" or "we"), we are building technology that enables people and businesses to participate more fully in the economy. Our purpose is economic empowerment, helping individuals and businesses manage, move, and grow their money through simple and connected tools.
Our Ecosystems
Block designs and operates connected ecosystems that integrate commerce solutions, financial services, software, hardware, and networks to serve individuals and small businesses, primarily through Cash App's consumer network and Square's business ("seller") network. Our platform integrates payments, banking, lending, and commerce solutions designed to provide secure, reliable, and scalable financial infrastructure. We apply data, automation, and AI to improve the speed, accuracy, and usability of our products.
Our ecosystem strategy connects these capabilities across both sellers and consumers. The ecosystems share common infrastructure for payments processing, risk management, identity, and data, allowing customers to access multiple products across a connected platform. We continue to invest in capabilities that enhance interoperability and efficiency, including embedded financial services, automation, and open protocols such as Bitcoin.
Square Ecosystem
We started Block with the Square ecosystem in February 2009 to enable businesses to accept card payments, a critical capability that had previously been inaccessible to many businesses. As our company grew, we recognized that sellers need a broad set of integrated solutions to operate efficiently and competitively. We saw how we could apply our strength in technology and innovation to help sellers. We have since expanded Square into a comprehensive commerce ecosystem that provides more than 30 distinct products and services to help our sellers start, run, and grow their businesses. We combine commerce solutions, financial services, and bitcoin capabilities to create products and services that are cohesive, fast, self-serve, and elegant. These attributes differentiate Square in a fragmented industry that traditionally forced sellers to stitch together products and services from multiple vendors, and often rely on inefficient non-digital processes and tools. Our ability to add new sellers efficiently, help them grow their business, and cross-sell our products and services has historically contributed to our growth.
Cash App Ecosystem
Cash App provides an ecosystem of financial products and services to help consumers manage their money. Cash App’s mission is to redefine the world’s relationship with money by making it more relatable, instantly available, and universally accessible. While Cash App started with the single ability to send and receive money, it now provides an ecosystem of commerce solutions, financial services, and Bitcoin capabilities focused on helping consumers make their money go further by enabling customers to store, send, receive, spend, invest, buy now, pay later ("BNPL"), borrow, or save their money with Cash App. Similar to our Square ecosystem, we believe the aggregation of these products into one app differentiates Cash App from competitors and provides greater utility for customers, allowing Cash App to build retentive relationships with its customers. Over time, with its bank partners, Cash App is aiming to become one of the top providers of banking services to households in the United States that earn up to $150,000 per year.
TIDAL Ecosystem
TIDAL expands our purpose of economic empowerment to artists. TIDAL is a global platform for musicians and their fans that uses unique content, experiences, and features to bring fans closer to artists and to provide artists with tools to succeed as entrepreneurs. TIDAL offers an extensive catalog of more than 250 million songs and 1,000,000 high-quality videos. TIDAL has a global presence with listeners in more than 60 countries and relationships with nearly 300 labels and distributors.
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Bitcoin Ecosystem
Our bitcoin ecosystem includes our bitcoin hardware projects, which include Bitkey, which is a self-custody bitcoin wallet, Proto, which is a bitcoin mining system, as well as Spiral, an independent team focused on contributing to bitcoin open source work. We believe our bitcoin ecosystem can help address inefficiencies in the current financial system, especially with respect to identity and trust. Through our bitcoin initiatives, we are developing open hardware, self-custody tools, and decentralized technologies that enable individuals to securely own and verify their digital assets, reinforcing user control and trust without reliance on traditional financial intermediaries.
Our Segments and Revenue Categories
Our two reportable segments are Square and Cash App, which reflects our two primary ecosystems and the manner in which the Company's chief operating decision maker ("CODM") reviews and assesses performance. Historically, we reported revenue by category, including transaction-based revenue, subscription and services-based revenue, hardware revenue, and bitcoin revenue. These categories represented the primary sources of revenue within our Square and Cash App ecosystems.
We have realigned our revenue categories to better reflect the evolution of our company. Since our initial public offering, we have grown from a payments-focused platform into a broader ecosystem that includes loan products through financial services and bitcoin-related offerings. These businesses are integral to our operations and illustrate the expanded scope of our company today. As a result, we identified three reportable revenue categories: Commerce Enablement, Financial Solutions, and the Bitcoin Ecosystem.
•Commerce Enablement empowers sellers and consumers to transact across our ecosystems. It primarily includes Square payments, software, and hardware, Cash App Card, Cash App Pay, our BNPL products, and Cash App Business. Commerce Enablement also includes TIDAL streaming and artist tools, which extend our commerce capabilities to creators.
•Financial Solutions provides banking, lending, and money management products for individuals and businesses. This primarily includes Cash App Borrow, Instant Deposit, Interest Income, Paper Money Deposits, ATM, and brokerage services, as well as Square Loans, Savings, Balances, and Square Card. Financial Solutions enables customers to access, manage, and grow their money.
•Bitcoin Ecosystem encompasses our consumer and business bitcoin products, including bitcoin buy/sell functionality in Cash App, Square Bitcoin, Proto, and Bitkey. This ecosystem reflects our efforts to make bitcoin accessible, secure, and integrated into everyday financial activity through the development of open financial infrastructure.
These revenue categories reflect how we see our business today. Each revenue category represents a distinct driver of growth and profitability within our business and is supported by shared infrastructure, including our automation and artificial intelligence platform. Together, these revenue categories generated $10.4 billion in gross profit in 2025.
Our Customers
Our Square Sellers
Square sellers represent a diverse range of industries (including services, food-related, and retail businesses) and sizes, ranging from sole proprietors to multinational businesses. Square sellers span geographies, including the United States, Canada, Japan, Australia, the United Kingdom, Ireland, France, and Spain. We have also increasingly served mid-market sellers, which we define as sellers that generate more than $500,000 in annualized Square Gross Payment Volume (“Square GPV”), due to our ability to offer more flexible and complex solutions than traditional alternatives, as well as a growing product suite. For the years ended December 31, 2025, 2024, and 2023, none of our customers accounted for greater than 5% of Square GPV. We define Square GPV as the total dollar amount of all card and bank payments processed by sellers using Square, net of refunds.
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In the year ended December 31, 2025, more than 4.5 million sellers used the Square ecosystem to make 5.9 billion individual sales transactions totaling $250 billion of Square GPV. These sales transactions originated from more than 800 million payment cards, across more than 300 million buyer profiles.
The charts below show the percentage mix of our Square GPV by seller industry and seller size for the year ended December 31, 2025:
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Our Cash App Customers
As of December 2025, Cash App had 59 million monthly transacting actives across the United States. In 2025, Cash App was the number one finance app on Google Play and number three finance app on iOS based on downloads in the United States. Cash App has a diverse mix of customers and, in the United States, had monthly transacting actives in each of the 50 states and nearly every county as of December 2025.
In 2025, Cash App transacting actives brought $316 billion in inflows into Cash App. In the fourth quarter of 2025, our Cash App monthly transacting actives brought in an average of $1,410 of inflows during the quarter. A transacting active is a Cash App account that has at least one financial transaction using any product or service within Cash App during the specified period. Examples of transactions include sending or receiving a peer-to-peer payment, transferring money into or out of Cash App, making a purchase using Cash App Card, earning a dividend on a stock investment, and paying back a loan, among others. Certain of these accounts may share an alias identifier with one or more other transacting active accounts. This could represent, among other things, one customer with multiple accounts or multiple customers sharing one alias identifier (for example, families).
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Our Products and Services
Square
Our Square ecosystem consists of more than 30 distinct commerce enablement and financial services products. Our products are designed to be self-serve and intuitive to make initial setup and new employee training fast and easy, although we also offer full-service setup and support. Our products are also flexible enough to serve the needs of both small, single location and large, complex multi-location sellers. Our products are integrated to create a seamless experience and enable a holistic view of sales, customers, employees, and finances. We supplement these first party capabilities with our open developer platform that enables integrations with third-party applications. We monetize these products primarily through our Commerce Enablement solutions, including payment processing, software, and hardware as well as through Financial Solutions, such as lending and banking services.
Our pricing and packaging model is intended to enhance product discovery, support increased software adoption and retention, and reflect our continued focus on maintaining simple and transparent pricing practices.
Strategic Priorities: Our focus for Square is reflected in three core pillars: Commerce, Automation, and Networks.
•Commerce: Square seeks to simplify selling for businesses of varying sizes by offering software, hardware, payments, and financial solutions delivered through a vertically integrated platform. These solutions are intended to support key seller workflows, including point-of-sale, ordering, inventory, staffing, and business management.
•Automation: We are focused on enabling growth by leveraging AI to increase productivity and outcomes for our sales and marketing, customer service, and engineering efforts, in addition to building features that help sellers grow their businesses. We aim to enhance seller efficiency by automating operational and financial tasks. Square’s AI-enabled tools are designed to reduce manual work, support sellers' decision-making, and enable sellers to manage their operations and finances more effectively, and give them time back.
•Networks: Our strategy includes strengthening local commerce ecosystems by enabling deeper connections among sellers, their customers, staff, and other sellers, and by leveraging Cash App’s network of monthly transacting actives to expand seller reach and support ecosystem engagement.
Commerce Enablement
Square's commerce enablement products include our payments, software, and hardware products, which together provide an integrated operating system for local commerce. These products enable sellers to accept payments, manage orders and inventory, engage customers, and operate their businesses across a range of industries and geographies.
•Square Payments capabilities enable sellers to accept card-present and card-not-present payments across in-person, online, mobile, and invoice-based channels. Square acts as both the merchant of record and payment service provider, settling funds with sellers and managing associated payment-related risk. Square generates payment processing fees on each completed transaction, which represent a significant component of Commerce Enablement revenue. As merchant of record, Square maintains contractual relationships with acquiring processors, card networks, and other providers of transaction-processing services. These arrangements often include commercial terms that are not typically available to sellers contracting independently with such providers.
•Square Software products enable sellers to manage point-of-sale operations, conduct commerce across in-person and online channels, and engage with their customers. These products are designed to simplify business management by integrating payment acceptance, order and inventory management, and customer engagement into a single platform.
In 2025, Square introduced a streamlined pricing and packaging framework consisting of three bundled tiers that combine software functionality with corresponding payment-processing rates. This structure is intended to simplify pricing, improve onboarding, and increase software adoption across the seller base. In addition to these tiers, we also offer custom pricing for larger sellers to meet their specific business needs.
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Square Point of Sale is Square’s primary commerce application for sellers and provides a customizable point-of-sale solution that supports a broad range of business types and operational needs. Additional software capabilities, including online and remote payment solutions, enable sellers to synchronize inventory, orders, and customer data across sales channels, supporting omnichannel commerce.
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Financial statements
data from SEC XBRL filings. Values are as-reported; restatements supersede originals. Values reported in .
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Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations
You should read the following discussion and analysis in conjunction with the information set forth within the condensed consolidated financial statements and the notes thereto included elsewhere in this Quarterly Report on Form 10-Q, as well as our Annual Report on Form 10-K. The statements in this discussion regarding our expectations of our future performance, liquidity and capital resources, our plans, estimates, beliefs and expectations that involve risks and uncertainties, and other non-historical statements in this discussion are forward-looking statements. These forward-looking statements are subject to numerous risks and uncertainties, including, but not limited to, the risks and uncertainties described under “Risk Factors” and elsewhere in this Quarterly Report on Form 10-Q. Our actual results may differ materially from those contained in or implied by any forward-looking statements.
Overview
We launched the Square ecosystem in February 2009 to enable businesses ("sellers") to accept card payments, a critical capability that had previously been inaccessible to many businesses. We have since expanded to provide sellers additional products and services and to give them access to a cohesive ecosystem of tools to help them start, run, and grow their businesses. Similarly, with Cash App, we have built an ecosystem of financial products and services to help consumers manage their money. Cash App now provides an ecosystem of commerce solutions, financial solutions, and bitcoin capabilities focused on helping consumers make their money go further by enabling customers to store, send, receive, spend, invest, BNPL, borrow, or save their money. In addition, our nascent ecosystems include TIDAL as well as Bitcoin, which includes businesses such as Proto and Bitkey.
In the first quarter of 2026, we generated gross profit of $2.9 billion, up 27% year over year. Cash App generated gross profit of $1.9 billion in the first quarter of 2026, up 38% year over year, driven by growth in Cash App Borrow. Square generated gross profit of $981.5 million in the first quarter of 2026, up 9% year over year, driven by financial solutions, most notably Square Loans.
In the first quarter of 2026, operating loss was $172.0 million and Adjusted Operating Income was $727.7 million, compared to operating income of $329.3 million and Adjusted Operating Income of $466.3 million in the first quarter of 2025. Net loss attributable to common stockholders was $308.7 million for the first quarter of 2026, compared to net income attributable to common stockholders of $189.9 million for the same period in 2025, and Adjusted EBITDA was $1.0 billion for the first quarter of 2026, compared to $812.8 million for the same period in 2025. Net loss for the first quarter of 2026 and net income for the first quarter of 2025 included losses of $172.8 million and $93.4 million, respectively, from the remeasurement of our bitcoin investment.
Refer to the Key Operating Metrics and Non-GAAP Financial Measures section below for reconciliations of non-GAAP financial measures to their nearest generally accepted accounting principles ("GAAP") equivalents.
In February 2026, we announced a workforce reduction restructuring plan (the “Workforce Plan”) designed to better align our organizational structure with our operating model and strategic priorities. As part of the Workforce Plan, we reduced our workforce by more than 40%. Restructuring charges in connection to the Workforce Plan during the three months ended March 31, 2026 were $495.3 million, which primarily consisted of cash expenditures for notice period and severance payments, employee benefits and related costs, as well as share-based compensation expense. We expect to incur additional immaterial related charges related to the Workforce Plan and expect that these remaining charges will be substantially complete by the end of the second quarter of fiscal 2026. We expect to realize benefits related to our focus on disciplined growth and cost efficiencies, and we expect to continue to benefit from these actions in future periods. We plan to continue to operate at this smaller size and are continuing to look at ways to improve our efficiency through a combination of AI automation, prioritization of our scope, performance management, and centralization of teams and functions to reduce duplication.
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The following table presents a summary of severance and other personnel costs related to the Workforce Plan (in thousands):
| Three Months Ended March 31, 2026 | |||||||||||||||||||||||||||||||||||||
Product development | $ | 351,350 | |||||||||||||||||||||||||||||||||||
Sales and marketing | 45,260 | ||||||||||||||||||||||||||||||||||||
General and administrative | 98,643 | ||||||||||||||||||||||||||||||||||||
Total | $ | 495,253 | |||||||||||||||||||||||||||||||||||
While timing and savings are subject to change, we expect annualized net cost savings associated with the Workforce Plan of approximately $800 million to $900 million, related to employee compensation, a portion of which we expect to strategically reinvest in the Company. We expect that we will begin to realize these cost savings upon the completion of the Workforce Plan. Refer to Note 20, Restructuring, within Notes to the Condensed Consolidated Financial Statements for further details regarding charges related to the Workforce Plan.
We ended the first quarter of 2026 with $9.1 billion in available liquidity, with $8.2 billion in cash, cash equivalents, restricted cash, and investments in marketable debt securities, as well as an undrawn amount of $900.0 million available under our revolving credit facility. This represents a decrease of $120.5 million from our available liquidity as of December 31, 2025, primarily due to $636.0 million of share repurchases in the first quarter of 2026 and net purchases and originations of loans originally classified as held for investment of $414.0 million, partially offset by net proceeds from principal repayments of consumer receivables of $652.6 million and an increase of $125.0 million to our revolving credit facility.
In November 2025, the board of directors of the Company authorized an increase to the Company's share repurchase program to repurchase up to an additional $5 billion of the Company's Class A common stock, for a total authorization of $9 billion. The goal of the program is to return capital to shareholders. The timing and number of shares repurchased will depend on a variety of factors, including the stock price, business and market conditions, corporate and regulatory requirements, alternative investment opportunities, acquisition opportunities, and other factors. As of March 31, 2026, we have repurchased a total of $4.3 billion of our Class A common stock under the program, of which $636.0 million was purchased in the first quarter of 2026.
Results of Operations
Revenue (in thousands, except for percentages)
| Three Months Ended March 31, | |||||||||||||||||||||||||||||||||||||||||||||||||||||||
| 2026 | 2025 | $ Change | % Change | ||||||||||||||||||||||||||||||||||||||||||||||||||||
| Commerce enablement revenue | $ | 2,938,470 | $ | 2,566,975 | $ | 371,495 | 14 | % | |||||||||||||||||||||||||||||||||||||||||||||||
| Financial solutions revenue | 1,321,985 | 875,011 | 446,974 | 51 | % | ||||||||||||||||||||||||||||||||||||||||||||||||||
| Bitcoin ecosystem revenue | 1,796,392 | 2,329,810 | (533,418) | (23) | % | ||||||||||||||||||||||||||||||||||||||||||||||||||
| Total net revenue | $ | 6,056,847 | $ | 5,771,796 | $ | 285,051 | 5 | % | |||||||||||||||||||||||||||||||||||||||||||||||
Total net revenue for the three months ended March 31, 2026 increased by $285.1 million, or 5%, compared to the three months ended March 31, 2025. Bitcoin ecosystem revenue decreased by $533.4 million for the three months ended March 31, 2026, compared to the three months ended March 31, 2025. Excluding bitcoin ecosystem revenue, total net revenue increased by $818.5 million, or 24%, in the three months ended March 31, 2026, compared to the three months ended March 31, 2025.
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Commerce enablement revenue for the three months ended March 31, 2026 increased by $371.5 million, or 14%, compared to the three months ended March 31, 2025. This increase in revenue was driven by growth in Square processing, which increased by $161.6 million for the three months ended March 31, 2026, compared to the three months ended March 31, 2025, as well as growth in Cash App Card and Afterpay Post-Purchase revenue of $72.3 million and $71.1 million, respectively. The growth in Square processing was in line with Square gross payment volume ("GPV") growth of 13%, driven primarily by strength in Food and Beverage sellers. See below in Key Operating Metrics and Non-GAAP Financial Measures for further discussion of GPV.
Financial solutions revenue for the three months ended March 31, 2026 increased by $447.0 million, or 51%, compared to the three months ended March 31, 2025. The increase was primarily due to growth in Cash App's financial solutions-related products, specifically Cash App Borrow origination volumes. For the three months ended March 31, 2026 compared to the three months ended March 31, 2025, Cash App Borrow revenue increased by $369.4 million as we continued to expand access to the product. Additionally, revenue from Square's financial solutions-related products increased by $45.7 million compared to the three months ended March 31, 2025, primarily related to Square Lending.
Bitcoin ecosystem revenue for the three months ended March 31, 2026 decreased by $533.4 million, or 23%, compared to the three months ended March 31, 2025. As bitcoin ecosystem revenue is primarily the total sale amount of bitcoin to customers, the amount of bitcoin ecosystem revenue recognized will fluctuate depending on customer demand as well as changes in the market price of bitcoin. The decrease in the three months ended March 31, 2026 was driven by a decrease in trading volume as well as the average market price of bitcoin, compared to the three months ended March 31, 2025. While the bitcoin ecosystem contributed 30% and 40% of total revenue for the three months ended March 31, 2026 and March 31, 2025, respectively, gross profit generated from the bitcoin ecosystem was only 2% and 4% of the total gross profit for both the three months ended March 31, 2026 and March 31, 2025.
Cost of Revenue (in thousands, except for percentages)
| Three Months Ended March 31, | |||||||||||||||||||||||||||||||||||||||||||||||||||||||
| 2026 | 2025 | $ Change | % Change | ||||||||||||||||||||||||||||||||||||||||||||||||||||
| Commerce enablement costs | $ | 1,317,459 | $ | 1,152,200 | $ | 165,259 | 14 | % | |||||||||||||||||||||||||||||||||||||||||||||||
| Financial solutions costs | 89,375 | 77,922 | 11,453 | 15 | % | ||||||||||||||||||||||||||||||||||||||||||||||||||
| Bitcoin ecosystem costs | 1,727,957 | 2,237,397 | (509,440) | (23) | % | ||||||||||||||||||||||||||||||||||||||||||||||||||
| Amortization of acquired technology assets | 12,817 | 14,674 | (1,857) | NM | |||||||||||||||||||||||||||||||||||||||||||||||||||
| Total cost of revenue | $ | 3,147,608 | $ | 3,482,193 | $ | (334,585) | (10) | % | |||||||||||||||||||||||||||||||||||||||||||||||
(i) Not meaningful ("NM")
Total cost of revenue for the three months ended March 31, 2026 decreased by $334.6 million, or 10%, compared to the three months ended March 31, 2025. Bitcoin ecosystem costs of revenue, which decreased by $509.4 million, was the primary driver of the decrease in total cost of revenue. Excluding bitcoin ecosystem costs of revenue, total cost of revenue increased by approximately $174.9 million, or 14%, in the three months ended March 31, 2026, compared to the three months ended March 31, 2025, largely related to an increase in Square GPV.
Commerce enablement costs for the three months ended March 31, 2026 increased by $165.3 million, or 14%, compared to the three months ended March 31, 2025. Commerce enablement costs for the three months ended March 31, 2026 were primarily driven by growth in Square processing costs, which were in line with the growth of Square GPV of 13%, as well as an increase in Square hardware costs.
Financial solutions costs for the three months ended March 31, 2026 increased by $11.5 million, compared to the three months ended March 31, 2025. The increase was primarily driven by growth in Cash App's financial solutions-related products on Cash App Card, including ATM, Paper Money Deposits, and related processing costs. While financial solutions revenue increased by 51% for the three months ended March 31, 2026, compared to the three months ended March 31, 2025, the costs of revenues increased by 15% for the same comparative period. This gross margin expansion is primarily due to more favorable economics in Cash App's financial solutions-related products.
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Bitcoin ecosystem costs for the three months ended March 31, 2026 decreased by $509.4 million, or 23%, compared to the three months ended March 31, 2025. Bitcoin ecosystem costs are primarily comprised of the total amounts we pay to purchase bitcoin, which fluctuates in line with bitcoin ecosystem revenue.
Operating Expenses (in thousands, except for percentages)
| Three Months Ended March 31, | |||||||||||||||||||||||||||||||||||||||||||||||||||||||
| 2026 | 2025 | $ Change | % Change | ||||||||||||||||||||||||||||||||||||||||||||||||||||
| Product development | $ | 1,038,873 | $ | 760,699 | $ | 278,174 | 37 | % | |||||||||||||||||||||||||||||||||||||||||||||||
| % of total net revenue | 17 | % | 13 | % | |||||||||||||||||||||||||||||||||||||||||||||||||||
| % of total gross profit | 36 | % | 33 | % | |||||||||||||||||||||||||||||||||||||||||||||||||||
| Sales and marketing | $ | 650,508 | $ | 504,460 | $ | 146,048 | 29 | % | |||||||||||||||||||||||||||||||||||||||||||||||
| % of total net revenue | 11 | % | 9 | % | |||||||||||||||||||||||||||||||||||||||||||||||||||
| % of total gross profit | 22 | % | 22 | % | |||||||||||||||||||||||||||||||||||||||||||||||||||
| General and administrative | $ | 857,564 | $ | 491,797 | $ | 365,767 | 74 | % | |||||||||||||||||||||||||||||||||||||||||||||||
| % of total net revenue | 14 | % | 9 | % | |||||||||||||||||||||||||||||||||||||||||||||||||||
| % of total gross profit | 29 | % | 21 | % | |||||||||||||||||||||||||||||||||||||||||||||||||||
| Transaction, loan, and consumer receivable losses | $ | 500,125 | $ | 169,689 | $ | 330,436 | 195 | % | |||||||||||||||||||||||||||||||||||||||||||||||
| % of total net revenue | 8 | % | 3 | % | |||||||||||||||||||||||||||||||||||||||||||||||||||
| % of total gross profit | 17 | % | 7 | % | |||||||||||||||||||||||||||||||||||||||||||||||||||
| Amortization of customer and other acquired intangible assets | $ | 34,159 | $ | 33,656 | $ | 503 | NM | ||||||||||||||||||||||||||||||||||||||||||||||||
| % of total net revenue | 1 | % | 1 | % | |||||||||||||||||||||||||||||||||||||||||||||||||||
| % of total gross profit | 1 | % | 1 | % | |||||||||||||||||||||||||||||||||||||||||||||||||||
| Total operating expenses | $ | 3,081,229 | $ | 1,960,301 | $ | 1,120,928 | 57 | % | |||||||||||||||||||||||||||||||||||||||||||||||
Product development expenses increased by $278.2 million, or 37%, for the three months ended March 31, 2026, compared to the three months ended March 31, 2025. The increase in expenses was driven by an increase in personnel costs of $252.7 million arising from the Workforce Plan and other restructuring costs, including severance and related expenses, partially offset by cost efficiencies from headcount reductions in the first quarter of 2025. Additionally, cloud computing infrastructure fees increased by $50.9 million for the three months ended March 31, 2026. These increases were partially offset by a $45.1 million reduction in allocated facilities, human resources, and IT expenses.
Sales and marketing expenses increased by $146.0 million, or 29%, for the three months ended March 31, 2026, compared to the three months ended March 31, 2025. The increase was primarily driven by Cash App peer-to-peer processing costs and related transaction losses of $82.6 million, as well as higher marketing and advertising costs of $20.1 million, as we prioritized marketing investments to support the growth of Cash App and Square. Additionally, personnel costs increased by $26.4 million, driven by the Workforce Plan and other restructuring costs, including severance and related expenses, partially offset by cost efficiencies from headcount reductions in the first quarter of 2025.
General and administrative expenses increased by $365.8 million, or 74%, for the three months ended March 31, 2026, compared to the three months ended March 31, 2025. The increase was primarily due to an increase in accrued expenses for estimated and settled amounts in connection with certain litigation and regulatory matters of $253.8 million. The increase in expenses was also due to higher personnel costs of $48.5 million driven by the Workforce Plan and other restructuring costs, including severance and related expenses, partially offset by cost efficiencies from headcount reductions in the first quarter of 2025, as well as an increase in facilities and other expenses of $42.6 million.
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Transaction, loan, and consumer receivable losses increased by $330.4 million, or 195%, for the three months ended March 31, 2026, compared to the three months ended March 31, 2025, as detailed below (in thousands, except for percentages):
| Three Months Ended March 31, | |||||||||||||||||||||||
| 2026 | 2025 | $ Change | % Change | ||||||||||||||||||||
| Loan losses | $ | 368,371 | $ | 66,953 | $ | 301,418 | 450 | % | |||||||||||||||
Consumer receivable losses (i) | 74,079 | 49,518 | 24,561 | 50 | % | ||||||||||||||||||
| Transaction losses | 57,675 | 53,218 | 4,457 | 8 | % | ||||||||||||||||||
| Total transaction, loan, and consumer receivable losses | $ | 500,125 | $ | 169,689 | $ | 330,436 | 195 | % | |||||||||||||||
(i) Amounts do not include reserves for certain receivables, such as late fees. Consumer receivables losses also includes provision for charge-back losses that are realized and written-off within the same period, rather than through the allowance for consumer receivable losses.
•Loan losses increased by $301.4 million, or 450%, compared to the three months ended March 31, 2025. The increase in loan losses was driven by significant growth in loan origination volumes of Cash App Borrow, which grew 175% in the same period, scaling Afterpay Post-Purchase, as well as growth in Square Loans. Underlying loan loss rates and portfolio credit performance remained stable. Additionally, beginning in the second quarter of 2025, Cash App Borrow, along with certain other loan products, were retained on our balance sheet and classified as held for investment, resulting in upfront recognition of expected credit losses upon origination.
•Consumer receivable losses increased by $24.6 million, or 50%, compared to the three months ended March 31, 2025, while loss rates remained stable. The increase was primarily due to growth of our BNPL products and higher origination volumes from preceding periods that reached charge-off during the current quarter.
Interest Expense (Income), Net (in thousands, except for percentages)
| Three Months Ended March 31, | |||||||||||||||||||||||||||||||||||||||||||||||||||||||
| 2026 | 2025 | $ Change | % Change | ||||||||||||||||||||||||||||||||||||||||||||||||||||
| Interest expense, net | $ | 53,195 | $ | 17,243 | $ | 35,952 | 209 | % | |||||||||||||||||||||||||||||||||||||||||||||||
Interest expense, net, increased by $36.0 million for the three months ended March 31, 2026, compared to the three months ended March 31, 2025, primarily due to the issuance of our 2030 and 2033 Senior Notes in the third quarter of 2025, which more than offset interest income received on invested funds. Refer to Note 12, Indebtedness within Notes to the Condensed Consolidated Financial Statements for further details.
Remeasurement Loss (Gain) on Bitcoin Investment (in thousands, except for percentages)
| Three Months Ended March 31, | |||||||||||||||||||||||||||||||||||||||||||||||||||||||
| 2026 | 2025 | $ Change | % Change | ||||||||||||||||||||||||||||||||||||||||||||||||||||
| Remeasurement loss on bitcoin investment | $ | 172,818 | $ | 93,351 | $ | 79,467 | 85 | % | |||||||||||||||||||||||||||||||||||||||||||||||
Remeasurement loss on bitcoin investment of $172.8 million for the three months ended March 31, 2026, compared to loss on bitcoin investment of $93.4 million for the three months ended March 31, 2025, was due to the remeasurement of our bitcoin investment to its fair value at each reporting date. Refer to Note 11, Bitcoin within Notes to the Condensed Consolidated Financial Statements for further details regarding the remeasurement of our bitcoin investment.
43
Other Expense (Income), Net (in thousands, except for percentages)
| Three Months Ended March 31, | |||||||||||||||||||||||||||||||||||||||||||||||||||||||
| 2026 | 2025 | $ Change | % Change | ||||||||||||||||||||||||||||||||||||||||||||||||||||
| Other income, net | $ | (5,426) | $ | (8,342) | $ | 2,916 | (35) | % | |||||||||||||||||||||||||||||||||||||||||||||||
Other income, net, of $5.4 million and $8.3 million for the three months ended March 31, 2026 and March 31, 2025, respectively, was primarily due to unrealized gains on certain investments and foreign exchange rate impacts.
Provision for (Benefit from) Income Taxes (in thousands, except for percentages)
| Three Months Ended March 31, | |||||||||||||||||||||||
| 2026 | 2025 | $ Change | % Change | ||||||||||||||||||||
| Provision for (benefit from) income taxes | $ | (83,982) | $ | 38,328 | $ | (122,310) | NM | ||||||||||||||||
Benefit from income taxes of $84.0 million for the three months ended March 31, 2026, compared to a provision for income taxes of $38.3 million for the three months ended March 31, 2025, was driven by lower pretax income and benefits from the release of income tax reserves due to the lapse of statutes of limitations. These were partially offset by tax shortfalls from share-based compensation.
Segment Results
Square
The following table provides a summary of the revenue and gross profit for our Square segment for the three months ended March 31, 2026 and March 31, 2025 (in thousands, except for percentages):
| Three Months Ended March 31, | |||||||||||||||||||||||||||||||||||||||||||||||||||||||
| 2026 | 2025 | $ Change | % Change | ||||||||||||||||||||||||||||||||||||||||||||||||||||
| Segment net revenue | $ | 2,112,321 | $ | 1,852,161 | $ | 260,160 | 14 | % | |||||||||||||||||||||||||||||||||||||||||||||||
| Segment cost of revenue | 1,130,772 | 954,262 | 176,510 | 18 | % | ||||||||||||||||||||||||||||||||||||||||||||||||||
| Segment gross profit | $ | 981,549 | $ | 897,899 | $ | 83,650 | 9 | % | |||||||||||||||||||||||||||||||||||||||||||||||
Revenue
Revenue for the Square segment for the three months ended March 31, 2026 increased by $260.2 million, or 14%, compared to the three months ended March 31, 2025. The increase was primarily due to the Square items referenced within our overall revenue discussion.
Cost of Revenue
Cost of revenue for the Square segment for the three months ended March 31, 2026 increased by $176.5 million, or 18%, compared to the three months ended March 31, 2025. The increase was primarily due to the Square items referenced within our overall cost of revenue discussion.
44
Cash App
The following table provides a summary of the revenue and gross profit for our Cash App segment for the three months ended March 31, 2026 and March 31, 2025 (in thousands, except for percentages):
| Three Months Ended March 31, | |||||||||||||||||||||||||||||||||||||||||||||||||||||||
| 2026 | 2025 | $ Change | % Change | ||||||||||||||||||||||||||||||||||||||||||||||||||||
| Segment net revenue | $ | 3,870,706 | $ | 3,879,014 | $ | (8,308) | NM | ||||||||||||||||||||||||||||||||||||||||||||||||
| Segment cost of revenue | 1,962,572 | 2,499,063 | (536,491) | (21) | % | ||||||||||||||||||||||||||||||||||||||||||||||||||
| Segment gross profit | $ | 1,908,134 | $ | 1,379,951 | $ | 528,183 | 38 | % | |||||||||||||||||||||||||||||||||||||||||||||||
Revenue
Revenue for the Cash App segment for the three months ended March 31, 2026 decreased by $8.3 million, compared to the three months ended March 31, 2025. The decrease was driven by the Cash App items referenced within our overall revenue discussion. While bitcoin ecosystem revenue contributed 45% of Cash App revenue for three months ended March 31, 2026, gross profit generated from bitcoin ecosystem was only 3% of Cash App gross profit for the three months ended March 31, 2026.
Excluding bitcoin ecosystem revenue, Cash App net revenue increased by $576.9 million, or 37%, compared to the three months ended March 31, 2025.
Cost of Revenue
Cost of revenue for the Cash App segment for the three months ended March 31, 2026 decreased by $536.5 million, or 21%, compared to the three months ended March 31, 2025. The decrease was due to the items referenced within our overall revenue and cost of revenue discussion. Excluding bitcoin ecosystem cost of revenue, Cash App cost of revenue increased by $20.1 million, or 8%, compared to the three months ended March 31, 2025.
Key Operating Metrics and Non-GAAP Financial Measures
We collect and analyze operating and financial data to evaluate the health of our business, allocate our resources, and assess our performance. In addition to total net revenue, operating income (loss), net income (loss), and other results reported under GAAP, the following table sets forth key operating metrics and non-GAAP financial measures we use to evaluate our business. We believe these metrics and measures are useful to facilitate period-to-period comparisons of our business, and to facilitate comparisons of our performance to that of other payment solution providers.
| Three Months Ended March 31, | |||||||||||||||||||||||||||
| 2026 | 2025 | ||||||||||||||||||||||||||
Gross Payment Volume (GPV) (in millions) | |||||||||||||||||||||||||||
Recent insider activity
| Date | Insider | Role | Action | Shares | Price | Value |
|---|---|---|---|---|---|---|
| 2026-06-11 | Eisen Anthony Mathew | Director | Sell | -6,000 | $66.07 | -$396,420 |
| 2026-06-10 | Eisen Anthony Mathew | Director | Sell | -6,000 | $66.64 | -$399,840 |
| 2026-06-09 | Eisen Anthony Mathew | Director | Sell | -6,000 | $68.82 | -$412,920 |
| 2026-06-08 | Eisen Anthony Mathew | Director | Sell | -6,000 | $68.22 | -$409,320 |
| 2026-06-05 | Eisen Anthony Mathew | Director | Sell | -6,000 | $70.19 | -$421,140 |
| 2026-06-04 | Eisen Anthony Mathew | Director | Sell | -6,000 | $70.84 | -$425,040 |
| 2026-06-03 | Eisen Anthony Mathew | Director | Sell | -6,000 | $72.82 | -$436,920 |
| 2026-06-02 | Eisen Anthony Mathew | Director | Sell | -6,000 | $76.35 | -$458,100 |
| 2026-06-01 | Eisen Anthony Mathew | Director | Sell | -135,750 ×2 | $76.81 | -$10,426,774 |
| 2026-06-01 | Ahuja Amrita | CFO & COO | Sell | -11,076 ×2 | $76.62 | -$848,624 |
| 2026-05-22 | Jennings Owen Britton | Business Lead | Sell | -1,316 | $68.54 | -$90,199 |
| 2026-05-22 | Grassadonia Brian | Ecosystem Lead | Sell | -8,166 ×2 | $68.01 | -$555,370 |
| 2026-05-21 | Jennings Owen Britton | Business Lead | Sell | -583 | $69.83 | -$40,711 |
| 2026-05-19 | Jennings Owen Britton | Business Lead | Sell | -44 | $71.00 | -$3,124 |
| 2026-04-21 | Ahuja Amrita | CFO & COO | Sell | -30,919 | $75.00 | -$2,318,925 |
| 2026-04-21 | Esperanza Chrysty | Chief Legal Officer | Sell | -3,000 | $75.00 | -$225,000 |
| 2026-04-06 | Grassadonia Brian | Ecosystem Lead | Sell | -1,769 | $60.25 | -$106,582 |
| 2026-04-06 | Jennings Owen Britton | Business Lead | Sell | -133 | $60.25 | -$8,013 |
Source: SEC Form 4 filings.
Next expected filings
- ~2026-08-06 10-Q expected by 2026-08-12 (in 52 days)
- ~2026-11-05 10-Q expected by 2026-11-11 (in 143 days)
- ~2027-02-26 10-K expected by 2027-03-02 (in 256 days)
- ~2027-05-06 10-Q expected by 2027-05-12 (in 325 days)
Predicted from historical filing cadence; not an SEC commitment.
Recent SEC filings
- 2026-06-05 8-K Officer/Director Change
- 2026-05-07 10-Q Quarterly Report
- 2026-05-07 8-K Earnings Release; Financial Statements and Exhibits
- 2026-05-04 8-K Officer/Director Change
- 2026-04-24 DEF 14A Proxy Statement
- 2026-02-26 10-K Annual Report
- 2026-02-26 8-K Earnings Release; Costs Associated with Exit; Financial Statements and Exhibits
- 2026-01-23 8-K Officer/Director Change
- 2026-01-14 8-K Material Agreement Entered; Material Financial Obligation; Financial Statements and Exhibits
- 2025-11-19 8-K Other Events
- 2025-11-06 10-Q Quarterly Report
- 2025-11-06 8-K Earnings Release; Financial Statements and Exhibits
- 2025-08-21 8-K Officer/Director Change
- 2025-08-18 8-K Material Agreement Entered; Material Financial Obligation; Other Events; Financial Statements and Exhibits
- 2025-08-07 10-Q Quarterly Report