Block (XYZ) Earnings Show Adjusted EPS Up 109% to a Record $1.13
Block (XYZ) earnings for the third quarter show adjusted diluted EPS up 109% to a record $1.13, as adjusted costs grew only 6%. Block also plans to pay about $764 million to end a Justice Department inquiry, and its profit under standard accounting rules grew far less.
The short answer. Block, the company behind Cash App, Square and Afterpay, nearly doubled its adjusted operating income in July to September, because gross profit grew much faster than its adjusted costs. For people who use Cash App, the quarter brought 60 million monthly active accounts, more lending and a move to Borrow loans paid back over six weeks. Block also plans to pay about $764 million to end a Justice Department inquiry. It raised its 2026 forecast for adjusted operating income by about the amount it beat its own third quarter forecast.
Block third quarter 2026 results at a glance
Show the data
| Step | Value |
|---|---|
| Q3 2025 | $480M |
| Gross profit | +$573M |
| Costs | -$130M |
| Q3 2026 | $923M |
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Every company reporting the same week, with its date and time, is in StockTitan's Earnings Calendar for the Week of November 2, 2026.
Block earnings for the third quarter of 2026
Block beat the forecast it gave for the quarter on all three of its main measures. Gross profit rose 22% to $3.24 billion, and the adjusted profit measures roughly doubled.
Block posted its third quarter shareholder letter at 4:05 p.m. Eastern Time on November 3, 2026. The company says it exceeded its own guidance for gross profit, adjusted operating income and adjusted diluted EPS. In its second quarter letter of August 5, Block had forecast adjusted diluted EPS of $1.02 and adjusted operating income of $875 million for the quarter.
Block shares traded at $80.50 at 5:01 p.m. Eastern Time in after-hours trading. That was 6.0% above their $75.93 price at the bell that ends regular trading.
In the first hour of after-hours trading, the shares swung between $72.47 and $83.34, according to StockTitan real-time Nasdaq data. The live price and chart are on StockTitan's Block overview page.
Block judges itself mainly on gross profit, which is revenue minus the direct costs of earning it. That matters here because much of its revenue is bitcoin that customers buy through Cash App, which brings in large sales at a thin profit. Revenue was $6.72 billion, against $6.11 billion a year earlier.
Cash App drove most of the growth. Its gross profit rose 27% to $2.07 billion. Square, the payments business for shops and restaurants, grew gross profit 14% to $1.16 billion.
Under standard accounting rules, known as GAAP, diluted EPS was $0.92, up 24%. Operating income on that basis rose 5% to $428 million. Block's past quarterly results are on its StockTitan financials page.
Block bought back no shares in the third quarter. Earlier in the year it spent $700.9 million on 11.6 million shares, and $4.6 billion was still available under its buyback plan on September 30.
Its diluted share count fell about 1% from a year earlier, to 615 million. Long-term debt stood at $5.72 billion at the end of September. Block's results and quarterly report announce no dividend.
| Measure, third quarter | 2025 | 2026 | Change stated by Block |
|---|---|---|---|
| Revenue | $6,115 million | $6,719 million | Not stated |
| Gross profit | $2,662 million | $3,235 million | +22% |
| Cash App gross profit | $1,624 million | $2,070 million | +27% |
| Square gross profit | $1,018 million | $1,157 million | +14% |
| Operating income (GAAP) | $409 million | $428 million | +5% |
| Adjusted operating income | $480 million | $923 million | +92% |
| Diluted EPS (GAAP) | $0.74 | $0.92 | +24% |
| Adjusted diluted EPS | $0.54 | $1.13 | +109% |
| Adjusted EBITDA | $833 million | $1,228 million | Record, per Block |
Source: Block third quarter 2026 shareholder letter, Form 8-K Exhibit 99.1, quarters ended September 30.
What changed for Cash App users
Cash App reached 60 million monthly active accounts in September, and more of them borrowed through the app. Borrow loans now give people six weeks to pay back.
Block counts a monthly transacting active as a Cash App account that made at least one money move in the month. That can be a payment, a transfer or a loan repayment. One person can hold more than one account. Cash App had 58 million a year earlier. Block says its Neighborhoods program, which links Square shops with Cash App customers, was a key driver of the growth.
Average gross profit per account rose, too. Cash App earned about $35 of gross profit per monthly transacting active in the quarter, against about $28 a year earlier. Gross profit grew 27% while the number of these accounts grew 4%.
Borrow, the app's short loan, moved to a six week loan by the end of September. Block says more flexible repayment was a top request from Borrow customers, and the new terms match its buy now, pay later products. While it made the switch, Block kept Borrow limits the same, so Borrow lending per customer fell 7% from the quarter before. It says it expects to raise Borrow limits again soon. The average Borrow limit was $300 in September, and the highest Block offers is $1,500.
Lending grew fast overall. Cash App and Afterpay lent $19.0 billion in the quarter, up 40% from a year earlier. Lending through Afterpay Post-Purchase more than tripled from a year earlier. How card loans fared at the largest US banks is in StockTitan's article JPMorgan, Wells Fargo Earnings: Credit Card Defaults Fell.
Bitcoin went the other way. Block says it chose to lower the fee it charges on certain bitcoin transactions in Cash App. Gross profit from bitcoin fell 50% to $52 million.
Spending through the app grew too. Commerce volume, led by the Cash App Card and Afterpay, rose 14% to $56.9 billion. Of the 60 million monthly active accounts, 28 million used the card in September. Block also launched Cash App en Español for Spanish speakers and made its Cash App Tags generally available in August.
| Cash App measure, third quarter | 2025 | 2026 |
|---|---|---|
| Monthly transacting actives | 58 million | 60 million |
| Primary banking actives | 8.3 million | 9.4 million |
| Commerce enablement volume | $49.7 billion | $56.9 billion |
| Consumer lending originations | $13.6 billion | $19.0 billion |
| Total inflows | $79 billion | $86 billion |
| Bitcoin ecosystem gross profit, all of Block | $104 million | $52 million |
Source: Block third quarter 2026 shareholder letter, Form 8-K Exhibit 99.1. Consumer lending covers Cash App Borrow and Block's buy now, pay later products.
Why Block's adjusted profit nearly doubled
Block earned a lot more from customers and spent less on building products. Its adjusted operating income was 29% of gross profit, the highest share it has reported.
Adjusted operating income is operating income without legal and restructuring charges and the accounting cost of past acquisitions. Block still counts the regular cost of the shares it pays to staff in this measure.
Gross profit rose much faster than adjusted costs. Gross profit rose 22%, or $573 million. Operating costs on the same adjusted basis grew only 6%. So 77% of the added gross profit became adjusted operating income.
Adjusted operating income as a share of gross profit has risen every quarter for a year, from 18% to 29%. Block expects it to reach 30% in the fourth quarter.
Show the data
| Category | Value |
|---|---|
| Q3 2025 | 18% |
| Q4 2025 | 20% |
| Q1 2026 | 25% |
| Q2 2026 | 27% |
| Q3 2026 | 29% |
Block spent less on building products. Product development costs fell 11% under GAAP and 12% on an adjusted basis. The company says this came from lower staff costs after the organizational changes it made in February. Sales and marketing spending rose 15%, as Block paid more to win new sellers and users.
Profit on the GAAP basis grew far less, because of large charges. Block booked $435 million of contingencies, restructuring and other charges in the quarter, against $21 million a year earlier. Its general and administrative costs rose 56% under GAAP, which the company says came mainly from higher accrued legal contingencies, the costs it has booked for expected legal outcomes. The largest of those legal matters is a planned Justice Department settlement, explained in the next section.
Losses on loans and other receivables also rose, by 66% under GAAP. Block says this followed the growth in loan volumes and a change in the mix of products.
| Cost line, third quarter | 2025 | 2026 |
|---|---|---|
| Operating expenses (GAAP) | $2,252 million | $2,807 million |
| Contingencies, restructuring and other charges | $21 million | $435 million |
| Non-GAAP operating expenses | $2,195 million | $2,325 million |
| Transaction, loan and consumer receivable losses | $363 million | $602 million |
| Adjusted operating income margin, share of gross profit | 18% | 29% |
Source: Block third quarter 2026 shareholder letter, Form 8-K Exhibit 99.1.
Block's planned $764 million Justice Department settlement
In its Form 10-Q filed on November 3, 2026, Block says it has agreed in principle on a deal to end a US Justice Department inquiry. The deal concerns a charge about its anti-money laundering program. Block has already booked the $764 million payment as a cost, and the deal is not final yet.
Block reached the agreement in principle with the Justice Department in October, according to its quarterly report on Form 10-Q. The plan is a deferred prosecution agreement, a deal in which prosecutors hold off on a charge while a company meets set conditions.
The charge is that Block failed to keep an effective anti-money laundering program, as a US law called the Bank Secrecy Act requires. The Justice Department would put the charge on hold for three years. If Block meets all its duties under the agreement for those three years, the department would ask a court to dismiss the charge for good.
The agreement sets a total payment of about $964 million. Block expects to pay about $764 million of it, after credit for earlier settlements with regulators. The deal still needs a final agreement and a court's approval. Block says the final cost could turn out higher than the amount it has booked.
Not all of that cost landed in the third quarter. By June 30, Block had already booked $526 million for this inquiry, according to its second quarter Form 10-Q. So about $238 million of it was added in the third quarter.
The inquiry started shortly after a short seller published a report on Block in March 2023. The Securities and Exchange Commission opened its own inquiry at the same time. In March 2026, its staff told Block they had closed that investigation and would not recommend enforcement action.
Block also reached a deal in principle in October to settle lawsuits that shareholders brought on the company's behalf against some of its current and former directors and officers. The suits make claims similar to a shareholder class action over Block's statements about its compliance programs. Under the deal, insurers for the company's directors and officers would pay Block $150 million, minus any fees the court awards to the shareholders' lawyers. A court must approve that deal too.
| Legal item | Amount | Status |
|---|---|---|
| Justice Department agreement, total payment | About $964 million | Agreed in principle, October 2026 |
| Justice Department agreement, payment Block expects to make | About $764 million, booked as of September 30, 2026; $526 million as of June 30, 2026 | Needs a final agreement and court approval |
| Accrued legal contingencies, all matters | $981 million on September 30, 2026, against $173 million on December 31, 2025 | On Block's balance sheet |
| Shareholder lawsuits filed on Block's behalf | $150 million to Block from insurers, minus lawyers' fees | Agreed in principle, needs court approval |
Source: Block Form 10-Q for the quarter ended September 30, 2026, Note 16 and the accrued expenses table; Form 10-Q for the quarter ended June 30, 2026, for the June figure.
What changed for Square sellers
Shops and restaurants ran more money through Square. Payment volume grew 14%, the fastest rate since early 2023.
Square sellers processed $76.4 billion of card and bank payments in the quarter, a measure Block calls gross payment volume. Growth in the United States sped up to 10.4%. Outside the United States, volume grew 26%. Food and drink sellers grew fastest, with volume up 20%.
Block also launched two new tools for sellers in October. Squaremates, an AI assistant that can draft promotions and prepare purchase orders, is now generally available to Square sellers in the United States. The new Square Kiosk lets restaurant customers order by voice or touch.
Block says Neighborhoods grew quickly after it signed up more than 30,000 new seller locations in August. Sellers on Neighborhoods now handle nearly $5 billion of payments a year.
Block guidance for 2026 and its higher outlook for 2027
Block raised its forecast for 2026 and now expects adjusted diluted EPS of $4.15, up 75%. Almost all of the raise comes from the third quarter, which beat Block's own forecast.
For 2026, Block now expects gross profit of $12.626 billion, up 22%. It expects adjusted operating income of $3.519 billion, up 69%. Both are well above the plan it set out at its Investor Day in November 2025, shown in the table below.
The full year forecast for adjusted operating income rose by $49 million from August. The third quarter alone beat Block's own forecast by $48 million.
So Block's view of the fourth quarter barely moved. It now expects $1.005 billion of adjusted operating income in that quarter, about what its August forecast for the year already implied. Its other fourth quarter forecasts are in the table below. For how company forecasts differ from analysts' estimates, see StockTitan's guide Guidance vs Consensus Estimates.
For 2027, Block expects gross profit to grow at least 15%, and adjusted operating income to grow 30% to $4.575 billion. It plans to spend more on Neighborhoods and on selling its AI tools to other companies. It expects its first revenue from those AI tools in the fourth quarter of 2026.
| Block forecast | Investor Day, November 2025 | August 2026 | November 2026 |
|---|---|---|---|
| 2026 gross profit | $11.980 billion | $12.51 billion | $12.626 billion |
| 2026 adjusted operating income | $2.700 billion | $3.47 billion | $3.519 billion |
| 2026 adjusted diluted EPS | Not given | $4.02 | $4.15 |
| Fourth quarter 2026 gross profit | Not given | Not given | $3.315 billion, up 15% |
| Fourth quarter 2026 adjusted diluted EPS | Not given | Not given | $1.15 |
| 2027 gross profit | $13.770 billion | Not given | $14.519 billion |
| 2027 adjusted operating income | $3.510 billion | Not given | $4.575 billion |
Source: Block third quarter 2026 shareholder letter, Form 8-K Exhibit 99.1, and second quarter 2026 shareholder letter, Exhibit 99.1 of the Form 8-K of August 5, 2026. Block gives no GAAP equivalent for its adjusted forecasts.
What to watch
- Whether Block raises Borrow limits as it expects: its fourth quarter shareholder letter on February 24, 2027, after the market closes
- Whether the Justice Department agreement becomes final: a final agreement and a court's approval, which Block will report in its filings
- Whether a court approves the $150 million shareholder lawsuit settlement: Block's next quarterly or annual report
- Block's plans for its AI tools for other companies: its Builderlab event in San Francisco on November 10, 2026
Our numbers
Block's actives are rounded to the million, so the per-account figures are approximate.
- Adjusted costs up 6%: non-GAAP operating expenses of $2,325 million, against $2,195 million a year earlier
- 77% of the added gross profit: adjusted operating income rose $443 million while gross profit rose $573 million
- About $35 of gross profit per Cash App account, against about $28: quarterly Cash App gross profit divided by the rounded monthly transacting actives of September, in 2026 and 2025
- About $238 million added to the Justice Department cost in the third quarter: the $764 million booked by September 30 minus the $526 million booked by June 30
- A raise about the size of the beat: the 2026 forecast for adjusted operating income rose $49 million, and the third quarter beat Block's own forecast by $48 million
- About $1.003 billion for the fourth quarter in August: the August full year forecast of $3.47 billion minus the first two quarters and the third quarter forecast
- The 6.0% after-hours rise: the 5:01 p.m. trade against the price at the bell, in StockTitan real-time Nasdaq data
Frequently asked questions
Did Block beat earnings expectations?
Block beat its own forecast for the quarter on gross profit, adjusted operating income and adjusted diluted EPS. Adjusted diluted EPS was a record $1.13, up 109% from a year earlier.
Why did Block's GAAP profit grow less than its adjusted profit?
Block booked $435 million of contingencies, restructuring and other charges in the quarter. Its general and administrative costs include $421 million more for legal and regulatory matters than a year earlier. The largest matter is a planned Justice Department settlement over its anti-money laundering program. Block has booked $764 million for it in total, about $238 million of that in the third quarter. Adjusted figures leave those charges out, so GAAP operating income rose 5% while adjusted operating income rose 92%.
How many people use Cash App?
Cash App had 60 million monthly transacting actives in September 2026. That is the number of accounts with at least one money move in the month, and one person can hold more than one account.
What changed with Cash App Borrow?
By the end of September, Cash App moved Borrow to a six week loan. Block kept Borrow limits the same during the switch and says it expects to start raising them again soon.
What is Block's guidance for 2026?
Block now expects 2026 gross profit of $12.626 billion, up 22%, adjusted operating income of $3.519 billion and adjusted diluted EPS of $4.15, up 75%. StockTitan's P/E ratio calculator divides a share price by an EPS figure like this one.
When does Block report next?
Block will report fourth quarter 2026 results on February 24, 2027, after the market closes.
Sources
- Block Announces Third Quarter 2026 Results, StockTitan
- Block third quarter 2026 shareholder letter, Form 8-K Exhibit 99.1, SEC
- Block Form 8-K, November 3, 2026, SEC
- Block Form 10-Q for the quarter ended September 30, 2026, SEC
- Block second quarter 2026 shareholder letter, Form 8-K Exhibit 99.1, SEC
- Block Form 10-Q for the quarter ended June 30, 2026, SEC
The information provided in this article is for educational and informational purposes only. It does not constitute financial advice, investment recommendation, or an endorsement of any particular investment strategy. Past performance does not guarantee future results. Investors should conduct their own research and consult with a qualified financial advisor before making investment decisions.