XYZ · Q2 2026 Earnings

Bullish

Block, Inc.

Reported August 5, 2026

30-second summary

Block delivered a Q2 that ran through every guided line: adjusted diluted EPS $1.02 (vs. $0.86 guide, +18.6%), adjusted operating income $864M (vs. $740M guide, +16.8%), adjusted operating margin 27% (vs. 24% guide, +300bps), and gross profit $3.166B (+25% YoY vs. $3.04B / +20% guide). Management raised FY2026 adjusted diluted EPS to $4.02 (+70% YoY, up from +62%), lifted FY adjusted operating margin to 28% (from 27%), and pushed FY gross profit to $12.51B (+21%, from +19%). The Q3 setup carries the acceleration: $1.02 EPS (+89% YoY), 28% adjusted operating margin, and gross profit $3.13B (+18% YoY).

Headline numbers

EPS

Q2 FY2026

$1.02

Revenue

Q2 FY2026

$6.62B

+9.3% YoY

Gross margin

Q2 FY2026

47.8%

Operating margin

Q2 FY2026

14.1%

Key financials

Q2 FY2026

Metric	Q2 FY2026	Q2 FY2025	YoY	Q1 FY2026	QoQ
Revenue	$6.62B	$6.05B	+9.4%	$6.06B	+9.3%
EPS	$1.02	$0.62	+64.5%	$0.85	+20.0%
Gross margin	47.8%	41.9%	+590bps	48.0%	-20bps
Operating margin	14.1%	19.0%	-490bps	-2.8%	+1690bps

Guidance

Guidance is issued for the full year only, refreshed each quarter. Prior and new below are the same FY updated this quarter.

Actuals vs prior guidance

Metric	Period	Prior guide	Actual	Δ	Result
Adjusted Diluted EPS	Q2 FY2026	$0.86	$1.02	+$0.16 above guide	Beat
Gross Profit	Q2 FY2026	$3.04B	$3.16B	+$0.12B above guide	Beat
Gross Profit YoY Growth	Q2 FY2026	20%	22%	+2pts above guide	Beat
Adjusted Operating Income	Q2 FY2026	$740M	$892M	+$152M above guide	Beat
Adjusted Operating Income Margin	Q2 FY2026	24%	27%	+3pts above guide	Beat
Adjusted Diluted EPS YoY Growth	Q2 FY2026	39%	87%	+48pts above guide	Beat

New guidance

Metric	Period	Guide	YoY
Rule of X	FY2026	49%	—

Changes to prior guidance

Metric	Period	Prior guide	New guide	Δ	Result
Gross Profit	FY2026	$12.33B	$12.51B	+$0.18B (+1.5%)	Raised
Gross Profit YoY Growth	FY2026	19%	21%	+2pts	Raised
Adjusted Operating Income	FY2026	$3.34B	$3.47B	+$0.13B (+3.9%)	Raised
Adjusted Operating Income Margin	FY2026	27%	28%	+1pt	Raised
Adjusted Diluted EPS	FY2026	$3.85	$4.02	+$0.17 (+4.4%)	Raised
Adjusted Diluted EPS YoY Growth	FY2026	62%	70%	+8pts	Raised

Segment performance

Q2 FY2026

Segment	Q2 FY2026	Q2 FY2025	YoY
Cash App	$1.131B	—	+31.0%
Square	$1.16B	—	+13.0%
Commerce Enablement	$3.342B	—	+15.0%
Financial Solutions	$1.382B	—	+40.0%
Bitcoin Ecosystem	$1.894B	—	-13.0%

Other KPIs

Q2 FY2026

Segment	Q2 FY2026	Q2 FY2025	YoY
Cash App Monthly Transacting Actives	59M	57M	—
Cash App Primary Banking Actives	9.4M	—	—
Cash App Commerce Enablement Volume	$56.5B	—	—
Cash App Commerce Enablement Monetization Rate	1.65%	—	—
Cash App Consumer Lending Origination Volume	$18.9B	—	—
Square GPV	$72.8B	—	—
Adjusted Operating Income Margin	27%	22%	—
Adjusted EBITDA	$1.2B	—	—

Management tone

No earnings-call Q&A transcript available this quarter. Drawing tone from the shareholder-letter prose: management is framing this quarter as validation of a multi-year "compound the hard capabilities" thesis — hardware (the reader, Bitkey, Proto, now Cash App Tags) and AI ("goose," Builderbot, Moneybot, Managerbot, Buzz) as the two capabilities compounding fastest. The letter leads with "year over year gross profit growth of 25% and record profitability" and explicitly ties results to "years of that compounding." The Moneybot 1M weekly engaged accounts and "agentic AI helped write and review nearly all of our production code changes" in June are the first quantified AI-usage disclosures. Framing is confident but not triumphalist; language around H2 comps ("we continue to expect Square gross profit to grow roughly in line with Square GPV in the second half of the year") remains disciplined.

Answers to last quarter's watch list

Q2 FY2026 gross profit landing at $3.04B (+20% YoY): Gross profit came in at $3.166B / +25% YoY, beating both the dollar guide by $126M and the growth-rate guide by 500bps. The +18% floor was cleared comfortably; the Q1 print was not front-loaded.

Resolved positively

Q2 adjusted operating margin landing at 24% with the go-to-market step-up: Q2 margin came in at 27%, +300bps above guide and +200bps above Q1's 25%. The RIF severance that was expected to compress Q2 margins did not — either the timing was different than guided, the reinvestment ramp is slower than telegraphed, or (most likely) the cost base is compounding beyond plan. The FY 28% margin guide now has meaningful cushion.

Resolved positively

Square gross-profit-to-GPV convergence: Square gross profit grew +13% YoY, in line with Square GPV +13% YoY. GP and GPV moved together — a change from prior quarters when GPV growth outran GP growth. Management noted a ~2pp tariff-reimbursement tailwind to Square GP growth (offsetting the prior-year network-remediation lap), so underlying GP growth is ~+11% vs GPV +13%. Management guided Square GP to grow "roughly in line with Square GPV in the second half of the year.".

Resolved positively

Square International GPV sustainability at +35%: International GPV grew +28% in Q2 (+25% constant currency), a 700bps step-down from Q1's +35% but well above the +20% "Q1 was an outlier" threshold. This is consistent with the harder-comp trajectory management telegraphed; the underlying international thesis holds.

Resolved positively

Bitcoin Ecosystem gross profit: Bitcoin Ecosystem gross profit came in at $72M / -31% YoY, a widening from Q1's -26%, driven by a strategic decision to reduce the fee Block charges on certain bitcoin transactions on Cash App and bitcoin trading dynamics. Proto was not called out separately.

Continue monitoring

MoneyBot and ManagerBot engagement disclosure: Block disclosed Moneybot at over 1 million weekly engaged accounts (accounts that sent at least one message or tapped a suggested prompt in the trailing seven days) — the first quantified engagement metric for the agent stack. Managerbot was described as "already automating marketing, margin analysis, and operational fixes for sellers" without a quantified usage figure. Builderbot was disclosed as helping "write and review nearly all of our production code changes" in June. The Cash App Commerce Enablement Monetization Rate (1.65%, +12bps YoY) is a Cash App unit-economics KPI, not directly attributable to AI-agent usage. Status: Partially resolved (usage disclosed; per-active revenue attribution still absent)

What to watch into next quarter

Q3 FY2026 gross profit landing at $3.13B (+18% YoY): the deceleration from Q2's +25% is guided; anything above +19% would suggest Block is materially outrunning even the raised FY setup. Below +16% would suggest H2 comp pressure is biting harder than modeled.

Q3 adjusted operating margin holding at 28%: Q2's 27% and Q3's 28% guide together imply the margin step-change is durable, not a Q2 timing artifact. A Q3 print below 26% would suggest reinvestment is finally hitting the P&L and that the FY 28% guide has less cushion than the two-quarter beat implies.

Cash App Primary Banking Actives — does the QoQ pattern normalize with the tax-refund seasonality unwind? Q1 was seasonally elevated by tax-refund inflows (footnote 16); Q2's step to 9.4M still represents +17% YoY growth. Watch whether Q3 resumes sequential growth off the 9.4M base, which would confirm the seasonal explanation, or whether the QoQ softness extends — a Q3 sequential decline would call the seasonal reading into question.

Cash App gross profit growth trajectory: Cash App gross profit growth decelerated from +38% (Q1) to +31% (Q2). Watch whether Q3 stabilizes near +30% (consistent with the ecosystem thesis) or continues to step down toward +25% (suggesting the Financial Solutions and Consumer Lending contribution is comping harder).

Underlying Square gross profit growth ex-tariff-reimbursement: the ~2pp tariff reimbursement flatters Q2. Underlying growth of ~+11% vs. GPV +13% is the base case Q3 must clear to confirm the reacceleration is real.

Rule of X FY2026 tracking to 49%: management put the number on the tape as a formal guidance line. Q3 guide implies 46%. Any deviation from this trajectory becomes the framework by which the FY setup is judged.

AI-agent per-active revenue attribution: Block now discloses Moneybot at 1M+ weekly engaged accounts and Builderbot at near-total production code coverage — usage is finally quantified. What is still missing is per-active revenue attribution: does a Moneybot-engaged Cash App active generate higher inflows, higher attach, or better retention than a non-engaged active? Without that linkage, the "intelligence company" framing remains strategic identity rather than a bottoms-up growth model.

Sources

Block, Inc. Q2 2026 Shareholder Letter / Press Release, SEC EDGAR filing: https://www.sec.gov/Archives/edgar/data/1512673/000119312526335117/d91486dex991.htm
Block Q1 2026 prior-period guidance reference (Tapebrief Q1 2026 brief: Q2 FY2026 guide of $3.04B gross profit / $740M AOI / 24% margin / $0.86 EPS / +39% YoY; FY2026 guide of $12.33B / $3.34B / 27% / $3.85 / +62% YoY)

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