Block Inc Earnings - Q3 2025 Analysis & Highlights
Key Takeaways
Block Inc's Q3 2025 earnings call highlighted strong financial performance, driven by growth in Cash App and Square. Management discussed strategies for expanding market share, leveraging AI, and capital allocation priorities, while also addressing the macroeconomic environment and providing financial guidance.
Key Financial Results
Gross profit grew 18% year-over-year to $2.66 billion, accelerating from 14% growth last quarter.
Adjusted operating income was $480 million.
Increased full year guidance for both Q3 beat and raised Q4 expectations.
Expect to deliver $10.243 billion in gross profit for the full year, reflecting more than 15% year-over-year growth.
Expect adjusted operating income of $2.056 billion, growing nearly 28% year-over-year.
Business Segment Results
Cash App's gross profit grew 24% year-over-year.
Square's gross profit grew 9% year-over-year and GPV grew 12%.
Proto generated first revenue, seeding what has the potential to become the next major ecosystem.
Capital Allocation
Repurchased approximately $1.5 billion of stock through the end of September.
Intend to continue returning capital to shareholders as they generate cash.
Capital allocation priorities to be shared at the upcoming Investor Day.
Industry Trends and Dynamics
Gaining profitable market share in target verticals like food and beverage with larger sellers and outside the US.
Focus on connecting sellers and consumers at scale.
Delivering AI tools to sellers to automate operations and finances.
Making selling easier with software solutions and commerce tools.
Competitive Landscape
Vertical integration provides an advantage, enabling faster movement and differentiated customer service.
Seen an inflection in new volume added (NVA), a proxy for volume growth from new customers.
Sales-driven NVA is up 28% year-to-date.
Expect to deliver strongest NVA performance ever in 2025 through expanding field sales, partner programs, and targeted marketing.
Macroeconomic Environment
Forward-looking statements are subject to risks and uncertainties, including changes in macroeconomic conditions.
Observed slightly slower GPV growth towards the end of October that is believed to be primarily weather related.
Growth Opportunities and Strategies
Focus on reaccelerating actives growth and increasing network density in Cash App.
Strategies to deepen engagement continue to show up in numbers.
Bringing the successful Square Releases format to Cash App with first Cash App Releases on November 13.
Introduced Neighborhoods on Cash App to connect sellers with Cash App's network.
Launched Square AI, a business partner built right into the tools sellers use every day.
Announced a number of new products, including multichannel menu management, unified third-party delivery app management and improved kiosks.
Monetize Proto's innovation in hardware and software through hardware sales across ASICs, mining hashboards and full mining rigs.
Financial Guidance and Outlook
For Q4 2025, expect to accelerate gross profit growth again, with gross profit growing over 19% year-over-year to $2.755 billion.
Expect to expand adjusted operating income margins year-over-year to 20% and deliver $560 million in adjusted operating income.
Expect 2025 and long-term tax rate to be in the mid-20% range.
Expect net interest expense of $45 million in the fourth quarter.
