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Block shares: Profit jumps 27% as outlook upgraded

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The Block CDI (ASX: XYZ) share price is in focus today after the company posted a first quarter gross profit of US$2.91 billion, up 27% year-over-year, and lifted its full-year outlook.

What did Block report?

  • Gross profit grew 27% year-over-year to US$2.91 billion
  • Adjusted operating income jumped 56% to US$728 million (25% margin)
  • Adjusted diluted EPS rose 52% to US$0.85
  • Total net revenue reached US$6.06 billion
  • Cash App gross profit increased 38% to US$1.91 billion, while Square grew 9% to US$982 million
  • Operating loss was US$172 million, impacted by US$852 million in restructuring and legal costs

What else do investors need to know?

Block accelerated its AI-driven productivity, with “Builderbot” and “Moneybot” tools now reviewing most production code changes and making customer recommendations. As a result, employee output is up and system reliability has improved. The company is also scaling new features, like Cash App managed accounts for children and community engagement tools through Neighborhoods, both showing early adoption.

The company’s lending portfolio continued to expand, with consumer lending origination volumes up 82% and Cash App Borrow originations nearly tripling year on year. Importantly, Block increased share repurchases to US$636 million in Q1, with US$4.7 billion remaining authorised.

What’s next for Block?

Block has lifted its 2026 guidance, now targeting gross profit of US$12.33 billion, up 19% year on year, and adjusted operating income margin of 27%. Adjusted diluted EPS is forecast to jump 62% to US$3.85. For the June quarter, Block expects another 20% gross profit growth and Adjusted EPS of US$0.86.

The business is committed to growing through AI-powered innovation, strengthening its lending offerings, and investing further in high-return areas like sales and customer engagement. Management expects further margin expansion while funding long-term growth.

Block share price snapshot

Over the past 12 months, Block shares have risen 31%, outperforming the S&P/ASX 200 Index (ASX: XJO) which has risen 8% over the same period.

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The post Block shares: Profit jumps 27% as outlook upgraded appeared first on The Motley Fool Australia.

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Motley Fool contributor Laura Stewart has no position in any of the stocks mentioned. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. has positions in and has recommended Block. The Motley Fool Australia has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips. This article was prepared with the assistance of Large Language Model (LLM) tools for the initial summary of the company announcement. Any content assisted by AI is subject to our robust human-in-the-loop quality control framework, involving thorough review, substantial editing, and fact-checking by our experienced writers and editors holding appropriate credentials. The Motley Fool Australia stands behind the work of our editorial team and takes ultimate responsibility for the content published by The Motley Fool Australia.

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