### Block Q2 2026 Results Beat Expectations, driven by broad-based growth across the Square and Cash App ecosystems, as well as efficiency gains from AI tools.

Key Data: Gross Profit grew 25% YoY to $3.17 billion; Adjusted Operating Income Margin reached a record high of 27%; Adjusted Diluted EPS rose 65% YoY to $1.02.

Business Progress: Square's U.S. GPV growth hit a three-year high, with new sellers from the ISO channel increasing over 150% QoQ. The Cash App Tags hardware product garnered 3 million pre-orders with zero marketing spend. The Neighborhoods platform achieved an annualized GPV of over $1 billion, growing 220%. AI tools boosted engineer code changes by 150%, and Square's feature releases in the first half of the year tripled YoY. Square Financial Services began accepting deposits and processed its first Square transactions.

Guidance & Outlook: The report raised full-year Gross Profit guidance to $12.51 billion (+21% YoY) and Adjusted Operating Income guidance to $3.47 billion (28% margin). Q3 Gross Profit growth is expected to be 18%.

Risk/Highlight Signals: Management's tone regarding AI and Neighborhoods was strongly optimistic, believing product-market fit has been found. However, Bitcoin ecosystem Gross Profit declined 31%, and hardware costs face pressure due to rising memory prices.