XYZ · Block, Inc.

¹ Reconciliations of non-GAAP financial measures used in this letter to their nearest GAAP equivalents are provided at the end of this letter. Please see these reconciliations for additional detail and a description of certain items that affected operating income (loss) and net income (loss) in the first quarter of 2026.

² Margins are all calculated as a percent of gross profit.

³ Adjusted Operating Income is a non-GAAP measure of operating performance and the profitability of our business, fully burdened by share-based compensation. For more information, please refer to the “Key Operating Metrics and Non-GAAP Financial Measures” section of this letter.

⁴ Adjusted Diluted EPS is a non-GAAP measure of profitability of our business. Beginning in fiscal 2025, we revised our definition of Adjusted Net Income Per Share to include share-based compensation. For more information, please refer to the “Key Operating Metrics and Non-GAAP Financial Measures” section of this letter.

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Early usage gives us conviction that proactive intelligence can drive customer value. What we are seeing among early customers of Moneybot and Managerbot is that agency matters. When AI helps a customer take an action, they return at dramatically higher rates than when it merely informs. Moneybot’s suggestion prompts and Managerbot’s insight-led sessions both materially outperform open-ended chat, showing that customers value when these products surface the insights that matter most.

Discovery matters too. Both products perform best when they show up in context instead of waiting for a customer or seller to go looking for them. As we move to general availability, Moneybot and Managerbot are evolving to be always on, working within Cash App and Square, and proactively recommending the next best action.

Block has two advantages here. First, because we are remote-first, decisions, code, designs, and progress are recorded and machine readable, giving AI a useful operating model to learn from and act on. Second, our products give us permissioned financial context across both sides of commerce: how people earn, spend, save, borrow, and run their businesses, and how sellers accept payments, manage staff, use banking tools, access credit, and run payroll. That context compounds over time and is difficult to assemble.

Our roadmap is differentiated because it connects AI directly to the financial decisions customers and sellers already make every day. Internally, AI is helping us move faster and improve quality. Externally, it is helping us build products that act earlier for customers and sellers. We are building tools that absorb complexity for people rather than just helping them manage it. That is the shift we believe few companies are ready to deliver. We are.

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Business Highlights

AI is transforming how and what we build.

As of early April, 100% of Block employees are using AI tools to do their work. One of these tools is Builderbot, which serves as both a multiplier for employees and an end to end automation layer, embedded across our engineering workflows, automating support, reviewing code changes, and initiating production-ready builds. The infrastructure enabling our increasing engineering velocity is the foundation for Moneybot and Managerbot, the proactive intelligence tools we’re building into the core interfaces of Cash App and Square.

We believe our focus on building proactive intelligence tools is differentiated and early adoption of Managerbot and Moneybot shows sellers and customers value when bots take action: approximately 70% of conversations on both Managerbot and Moneybot are initiated through proactive prompts. Sellers are 33% more likely to return to Managerbot if they experience an insight-led session and Cash App customers are 5x more likely to return to Moneybot after taking a recommended action, making insight-led engagement a strong predictor of continued Managerbot and Moneybot use. Our most engaged Moneybot customers are taking actions to track spending, set up savings goals, and analyze transaction history while our most engaged Managerbot sellers are looking to update and create catalog items and build marketing campaigns. Moneybot customers are requesting automations before the feature ships while sellers using Managerbot are asking for cross-workflow intelligence that aligns with our roadmap. Our focus is on designing these products to deliver in-context insights while supporting automation for our customers.

Neighborhoods is beginning to take hold in local communities.

Our pace of scaling Neighborhoods, our loyalty, discovery and rewards experience that connects Square sellers with consumers, accelerated into April as we introduced auto-enrollment and expanded Local Cash redemption to in-store purchases. As of March, we’ve scaled Neighborhoods to sellers representing $320 million in annualized gross payment volume (GPV), up 190% from December. Over the month of April alone we added more sellers to Neighborhoods than we did in the entire history of the product previously.

We’ve organized Neighborhoods around the concept of a follower: a consumer building a direct, first-party relationship with a Square seller to earn rewards and support their favorite local businesses, all within Cash App. This model is driving meaningful engagement: in April, we crossed 100K Cash App accounts following at least one seller on Neighborhoods, over 50% of whom were not active on Cash App in the 30 days prior to signing up. Total followers grew 94% between December and March, and we expect followers to continue to scale meaningfully as we expand the availability of Neighborhoods to more sellers. On average in our early testing cohorts, we’ve seen sellers reach over 1,000 followers in their first year on the platform, and on average, we’ve seen spend from followers reach 10% of seller GPV after three quarters on Neighborhoods. During Q1, followers transacted 50% more often than non-followers, and we’re giving Square sellers the tools to interact with and engage these critical customers.

Cash App Green is expanding our reach and deepening engagement. We ended March with 9.7 million Primary Banking Actives (PBAs)⁵, up 18% year over year.

Cash App Green, our status program, is helping drive Cash App deeper into new geographies by reaching customers in markets where our network is still developing. New Cash App Green cohorts skew younger: we estimate the average age of a Cash App Green Active is 34, compared to a median age of over 50 for traditional banking customers in the U.S. Our Cash App Green program reflects our focus on the modern earner, a growing segment of the workforce that earns income from multiple dynamic sources including hourly wages, gig work, freelancing, and entrepreneurship. Primary Banking Actives growth remained strong, helping drive continued strong Cash App Card performance in the first quarter. Cohorts engaged with Cash App Green show sustained improvements in retention, particularly among those actively using Cash App Green benefits.

⁵ Square and Cash App are financial services platforms, not banks. Throughout this letter, any reference to Square or Cash App’s banking offerings or terms such as “primary banking actives” refer to products and services that are offered through Block’s Industrial Bank, Square Financial Services, Inc., or through our third-party bank partners. A transacting active is a Cash App account that has at least one financial transaction using any product or service within Cash App during a specified period. A transacting active for a specific Cash App product has at least one financial transaction using that product during the specified period and is referred to as an active. 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). A Primary Banking Active (PBA) is a Cash App account that receives inflows from ACH or certain original credit transactions relating to earned wages, excluding tax refunds and ACH transfers, or spent at least $500 per month across Cash App, including Cash App Card, Cash App Pay, Afterpay through Cash App, and ACH bill pay during a specified period.

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In April, we expanded our banking functionality further into the next generation by introducing Cash App managed accounts for kids, a parent-sponsored experience for children ages 6-12. Approximately half of parents on Cash App today already use the platform to manage their children’s finances, and Cash App managed accounts for kids will now provide the opportunity for children to earn up to 3.25% interest on savings, receive money from trusted contacts, and design their own Cash App Card with oversight from a parent or legal guardian. This experience is built with trust and safety as a critical principle, including parental controls, curated contact permissions, and safeguards designed for age-appropriate financial access.

Consumer Lending Origination volume growth, which includes originations from Cash App Borrow and our BNPL products, accelerated to 82% year over year in the first quarter while maintaining healthy risk loss outcomes across new and mature cohorts.

Borrow originations nearly tripled year over year as we continued to expand eligibility into Cash App Green cohorts while increasing originations per active and maintaining strong risk loss performance. Afterpay Post-Purchase also remained on a strong growth trajectory and, through the first quarter, continued to exceed the early growth curve of Borrow. We observed customers who use both Borrow and Afterpay Post-Purchase demonstrating stronger repayment rates than customers who adopt just one product. In February, we began piloting Afterpay Pre-Purchase and are seeing strong early attach rates and in April we launched Afterpay for P2P transactions, marking another milestone in extending credit to our customers.

We’ve built proprietary credit infrastructure that spans our consumer credit products and meets customers across the key financial moments in their lives. This foundation has driven strong performance across our lending portfolio, and in May, extended the reach of our credit platform further as we began making Cash App Score visible to customers. Early data has been encouraging, with 80% of customers in testing reporting they took at least one of our recommended actions to improve their score. We expect to increase transparency and engagement by showing tangible steps for customers to improve their Cash App Score, providing greater incentive for customers to bring more of their financial lives onto Cash App and giving us the ability to assess creditworthiness more holistically. Over time, we expect this dynamic to compound, strengthening both customer outcomes and the depth of our customer relationships.

We continued to scale Square distribution across geographies and channels, and accelerated GPV growth to 13% in the first quarter.

U.S. New Volume Added (NVA) sustained strong growth in the first quarter, reflecting high ROI field sales investments made throughout 2025.⁶ We continued to see strong marginal ROIs on field sales and expanded our field sales team further in the first quarter, both in the U.S. and internationally. Beyond field sales, early results from over 140 independent sales organization (ISO) partnerships exceeded our expectations, with over 200% quarter over quarter growth in the number of new sellers coming onto Square from ISO partners in Q1. We continued to see healthy self-onboard NVA growth in the first quarter and International NVA growth was strong, driven by the expansion of our international field sales team.

Our product innovation and focus on expanding distribution have helped us win more large, upmarket sellers, including Steak Escape, a quick service restaurant (QSR) franchise with more than 20 locations that is rolling out Square across drive-through, kiosk, and in-store channels to replace a fragmented tech stack with our unified commerce platform. We also announced our partnership with GOLFTEC, the world’s largest provider of golf lessons and premium club fittings, who selected Square to power its payments and commerce infrastructure across 200+ U.S. locations.

⁶ New Volume Added (NVA) is the total gross payment volume (GPV) processed, or expected to be processed, by new sellers during their first 12 months on Square. While intended to represent incremental volume from new cohorts, it may also include GPV from existing sellers in cases such as new locations or event-based merchant tokens. For the purpose of this letter, figures exclude deactivated merchants.

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Financial Discussion

We delivered another strong quarter, as year-over-year gross profit growth accelerated to 27% and Adjusted Operating Income margin reached an all time high of 25%. Adjusted Operating Income grew by 56% year over year and Adjusted Diluted EPS grew by 52% year over year, reflecting continued strong execution as we seek to make intelligence central to how we operate. Cash App Commerce Enablement volume growth accelerated to 18%, Consumer Lending origination volume growth accelerated to 82%, and PBAs grew 18% year over year to 9.7 million in March.⁷ Square GPV growth accelerated to 13%, and we sustained strong NVA growth in the first quarter.⁸ We are raising our full-year guidance to reflect our strong execution and increased expectations for the remainder of the year. We now expect year-over-year gross profit growth of 19% in 2026, along with 27% Adjusted Operating Income margin and Adjusted Diluted EPS growth of 62%.

First Quarter 2026 Financial Highlights

⁷ Commerce Enablement volume includes GPV from Cash App Card, Cash App Pay, BNPL products, and Cash App Business.

⁸ Square GPV is defined as the total dollar amount of all card and bank payments processed by sellers using Square, net of refunds.

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Block Financial Metrics

Overall Block gross profit growth accelerated to 27% year over year in the first quarter, with 38% year-over-year growth in Cash App and 9% year-over-year growth in Square. Commerce Enablement year-over-year gross profit growth accelerated to 15%, led by strength in Cash App. Financial Solutions year over year gross profit growth also accelerated to 55% in the first quarter, driven by Cash App Consumer Lending. Bitcoin Ecosystem gross profit declined 26% year over year in the first quarter, driven by bitcoin trading dynamics and by a strategic decision to reduce the fee we charge on certain bitcoin transactions on Cash App.

⁹ Quarterly gross profit by category may not sum to total gross profit due to rounding.

¹⁰ Commerce Enablement gross profit reflects the impact of amortization of acquired technology assets.

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Our performance in the first quarter demonstrates our ability to drive strong gross profit growth as we expanded Adjusted Operating Income margins and returned capital to shareholders, which translated into exceptional Adjusted Diluted EPS performance. On a GAAP basis, we generated $172 million in operating loss in the first quarter of 2026, which included $852 million in restructuring and other charges, driven by the organizational change we executed in February, and accrued legal contingencies. Adjusted Operating Income grew 56% year over year, supported by strong gross profit growth and disciplined execution. On a GAAP basis, we delivered diluted net loss per share of $0.52. Adjusted Diluted EPS grew 52% year over year to $0.85.

¹¹ Q1 2026 diluted EPS reflects a negative $0.29 impact from a $173 million bitcoin remeasurement loss, compared to a negative $0.15 impact from a $93 million bitcoin remeasurement loss in Q1 2025 each on a pre-tax basis.

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Cash App

Cash App gross profit increased 38% year over year, driven by growth across Cash App Borrow and Commerce Enablement, most notably our BNPL products and Cash App Card. Commerce Enablement volume growth accelerated to 18% year over year to $55.0 billion, driven by strength in Cash App Card and accelerating growth in Afterpay BNPL. Commerce Enablement monetization rate increased by 9 basis points year over year, driven by increased Afterpay Post-Purchase product attach. Financial Solutions Gross Profit per Active grew 60% year over year, driven by strength in Cash App Borrow. Cash App monthly transacting actives were 59 million in March, while PBAs grew 18% year over year to 9.7 million in March, up from 9.3 million in December. Inflows per transacting active grew 10% year over year in the first quarter, driven in part by more customers bringing their paychecks into Cash App.

¹² Starting Q1 2026, Cash App Commerce Enablement volume includes Tap to Pay GPV within Cash App Business GPV. Prior periods have not been recast due to immateriality.

¹³ Cash App Commerce Enablement Monetization Rate is calculated by dividing Cash App Commerce Enablement gross profit by Cash App Commerce Enablement volume.

¹⁴ Historically, our Cash App ecosystem has experienced improvements in revenue, gross profit, and inflows related to the distribution of government funds as customers have deposited more funds into Cash App during these times, including during the first quarter when U.S. tax refunds are typically distributed.

¹⁵ Inflows per transacting active refers to total inflows in the quarter divided by monthly actives for the last month of the quarter. Inflows refers to funds entering the Cash App ecosystem. Inflows does not include the movement of funds when funds remain in the Cash App ecosystem or when funds leave the Cash App ecosystem, or inflows related to the Afterpay app.

¹⁶ Financial Solutions Gross Profit per Active is calculated based on Cash App Financial Solutions gross profit in a given quarter divided by overall monthly transacting actives for the last month of the quarter. Cash App Financial Solutions gross profit includes gross profit from ATM, Borrow, Brokerage, Cash App Business Instant Deposit, Instant Deposit, Instant Pay, Interest Income, Paper Money Deposits, and Pools.

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Cash App Consumer Lending origination volume growth accelerated to 82% year over year to $17.6 billion, driven by strength in Cash App Borrow. We continued to observe what we believe are industry-leading returns on capital as we expanded Consumer Lending to new customer cohorts, including newly eligible Cash App Green customers. Borrow loss rates remained healthy with new and mature customer cohort loss rates continuing to perform in line with our expectations.

Square

Square GPV grew 13% and 11.5% year over year in the first quarter on a reported and constant currency basis, respectively, to $61.2 billion, reflecting strong NVA performance in 2025 from investments in sales and marketing and strong GPV retention. GPV from food and beverage sellers was up 21% year over year, our strongest growth rate since the first quarter of 2023, while GPV from retail sellers and services sellers grew 11% and 7% year over year, respectively. We saw a more pronounced acceleration in year-over-year growth for our mid-market seller segment (>$500K in annualized GPV) compared to our other seller segments during the first quarter.

Square gross profit grew 9% year over year in the first quarter, driven primarily by Financial Solutions, most notably Square Loans. Excluding hardware, which includes one-time customer acquisition costs, Square gross profit grew 11% year over year. We continue to expect Square gross profit to grow in line with GPV growth in the second half of the year after we fully lap the impacts of the operational processing change we made last year and the network remediation payment we received in the second quarter of 2025.

¹⁷ Square Commerce Enablement (excluding Hardware) Monetization Rate is calculated by dividing Square Commerce Enablement gross profit excluding hardware by total Square GPV. Square Commerce Enablement Gross Profit is primarily composed of Square Payments and Software.

¹⁸ Square Financial Solutions Monetization Rate is calculated by dividing Square Financial Solutions gross profit by total Square GPV. Square Financial Solutions Gross Profit is primarily composed of Square Loans, Instant Deposit, and Square Card.

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Operating Expenses and Non-GAAP Operating Expenses ($M)

In the first quarter, general and administrative, product development, and sales and marketing expenses grew 74%, 37%, and 29% year over year on a GAAP basis, respectively, driven in part by higher personnel-related restructuring costs associated with the organizational changes we executed in February, as well as accrued legal contingencies recorded in general and administrative expenses. Non-GAAP general and administrative expenses decreased 4% year over year. Non-GAAP product development expenses decreased 9% year over year driven by reduced personnel-related costs, partially offset by higher software and cloud costs. Non-GAAP sales and marketing expenses grew 22%, with Cash App sales and marketing expenses up 36% and other sales and marketing expenses up 20% year over year.

Transaction, loan, and consumer receivable losses increased 195% year over year on a GAAP basis, driven primarily by growth in loan volumes. Cash App Borrow origination volume increased 175% year over year while Afterpay Post-Purchase origination volume grew over 15x year over year. Cohort level Borrow risk loss rates continue to be in line with our expectations and consistent with data we shared at Investor Day, with loss rates of 3.16%, 3.01%, and 2.67% for customers in the 0-6 month, 7-12 month, and 13+ month cohorts, respectively. Based on our Consumer Lending origination volume growth forecast and our expected mix of new and mature customer cohorts in Cash App Borrow, we expect transaction, loan, and consumer receivable losses growth rates to decline throughout the rest of 2026.

¹⁹ Quarterly figures presented may not sum precisely due to rounding.

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Key Profitability Measures and EPS ($M, except per share figures)

²⁰ Q1 2026 operating income included $852 million in (i) restructuring and other charges, which include restructuring share-based compensation expense driven by the organizational change we executed in February, and (ii) accrued legal contingencies.

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Non-GAAP Cash Flow ($M)

In the first quarter of 2026, we continued to prudently invest in our lending products, including growing Cash App Borrow given the strong unit economics and returns we have seen. Within our non-GAAP cash flow, we have deployed $2.8 billion in capital to grow our lending products over the last 12 months. We also remain focused on returning capital to shareholders. In November 2025, our board of directors authorized an increase to our share repurchase program of up to an additional $5 billion of our Class A common stock, and in the first quarter we repurchased 10.7 million shares of our Class A common stock for an aggregate amount of $636 million. As of March 31, 2026, we had $4.7 billion in remaining authorization for repurchases.

We ended the quarter with $9.1 billion of total liquidity, with $8.2 billion in cash, cash equivalents, restricted cash, and investments in marketable debt securities, as well as $900 million available to be withdrawn from our revolving credit facility and $961 million available to be withdrawn under our warehouse funding facilities.

²¹ Quarterly figures presented may not sum precisely due to rounding.

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Guidance

2026 Outlook²²

We now expect to deliver $12.33 billion in gross profit in 2026, representing 19% year-over-year growth, along with $3.34 billion in Adjusted Operating Income and $3.85 in Adjusted Diluted EPS. Our increased guidance across gross profit, Adjusted Operating Income, and Adjusted Diluted EPS reflects our outperformance in the first quarter and increased expectations for the remainder of the year.

Our Adjusted Operating Income and Adjusted Diluted EPS guidance translate to 60% and 62% growth year over year, respectively. We plan to deliver this margin expansion and grow Adjusted EPS meaningfully at scale while investing in our business to sustain long term growth.

²² We have not provided the forward-looking GAAP equivalents for certain forward-looking non-GAAP metrics, including Adjusted Operating Income (Loss) and Adjusted Diluted EPS, or GAAP reconciliations of any of the aforementioned, as a result of the uncertainty regarding, and the potential variability of, reconciling items such as contingencies, restructuring, and other charges. Accordingly, the Company has relied upon the exception in item 10(e)(1)(i)(B) of Regulation S-K to exclude such reconciliations, as the reconciliations of these non-GAAP guidance metrics to their corresponding GAAP equivalents are not available without unreasonable effort. However, it is important to note that material changes to reconciling items could have a significant effect on future GAAP results. We have provided reconciliations of other historical GAAP to non-GAAP metrics in tables at the end of this letter, as well as relevant non-GAAP definitions.

²³ Rule of 40 is the sum of our gross profit growth and Adjusted Operating Income margin as a percent of gross profit. We may refer to a “Rule of” number other than 40 to refer to the sum of gross profit growth and Adjusted Operating Income margin as a percent of gross profit for the period given.

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Q2 2026 Outlook²⁴

In the second quarter we expect to deliver gross profit of $3.04 billion, representing 20% year-over-year growth, and $740 million in Adjusted Operating Income, representing 35% year-over-year growth and 2 points of margin expansion compared to the second quarter of 2025. We expect to increase go to market spend meaningfully in the second quarter as we continue to see opportunities to invest in high ROI growth initiatives. We also expect to deliver $0.86 in Adjusted Diluted EPS in the second quarter, or 39% growth year over year, as our strong growth translates into strong per share financial performance for shareholders.

²⁴ We have not provided the forward-looking GAAP equivalents for certain forward-looking non-GAAP metrics, including Adjusted Operating Income (Loss) and Adjusted Diluted EPS, or GAAP reconciliations of the aforementioned, as a result of the uncertainty regarding, and the potential variability of, reconciling items such as contingencies, restructuring, and other charges. Accordingly, the Company has relied upon the exception in item 10(e)(1)(i)(B) of Regulation S-K to exclude such reconciliations, as the reconciliations of these non-GAAP guidance metrics to their corresponding GAAP equivalents are not available without unreasonable effort. However, it is important to note that material changes to reconciling items could have a significant effect on future GAAP results. We have provided reconciliations of other historical GAAP to non-GAAP metrics in tables at the end of this letter.

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Earnings Webcast

Block (NYSE:XYZ) will host a conference call and earnings webcast at 2:00 p.m. Pacific time/5:00 p.m. Eastern time, May 7, 2026, to discuss these financial results. To register to participate in the conference call, or to listen to the live audio webcast, please visit the Events & Presentations section of Block’s Investor Relations website at investors.block.xyz. A replay will be available on the same website following the call. We will release financial results for the second quarter of 2026 on August 5, 2026, after the market closes, and will also host a conference call and earnings webcast at 2:00 p.m. Pacific time/5:00 p.m. Eastern time on the same day to discuss those financial results.

Media Contact

[email protected]

Investor Relations Contact

[email protected]

Jack Dorsey		Amrita Ahuja

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Condensed Consolidated Statements of Operations

Unaudited

In thousands, except per share data

Condensed Consolidated Balance Sheets

In thousands, except per share data