Q4 2025 Block Inc Earnings Call

February 26, 2026

Speaker #1: Statements, except as required by law. Further, any discussion during this call of our lending and banking products for further products that are offered through Square Financial Services or our bank partners.

Operator: Statements except as required by law. Further, any discussion during this call of our lending and banking products refer to products that are offered through Square Financial Services or our bank partners. Within these remarks, we will also discuss metrics related to our investment framework, including Rule of 40. With Rule of 40, we are evaluating the sum of our gross profit growth and adjusted operating income margin. Also, we will discuss certain non-GAAP financial measures during this call. Reconciliations to the most directly comparable GAAP financial measures are provided in the shareholder letter. These non-GAAP measures are not intended to be a substitute for our GAAP results. Finally, this call in its entirety is being audio webcast on our investor relations website. An audio replay of this call and the transcript for Jack and Amrita's opening remarks will be available on our website shortly.

Speaker #1: Within these remarks, we will also discuss metrics related to our investment framework, including Rule of 40. With Rule of 40, we are evaluating the sum of our gross profit growth and adjusted operating income margin.

Speaker #1: Also, we will discuss certain non-GAAP financial measures during this call. Reconciliations to the most directly comparable GAAP financial measures are provided in the shareholder letter.

Speaker #1: These non-GAAP measures are not intended to be a substitute for our GAAP results. Finally, this call in its entirety is being audio webcast on our investor relations website, and an audio replay of this call and the transcript for Jack and Amrita's opening remarks will be available on our website shortly.

Speaker #1: With that, I'd like to turn it over to Jack.

Operator: With that, I'd like to turn it over to Jack.

Speaker #2: Thank you all for joining us. Today we shared a difficult decision with our team. We're reducing block from over 10,000 people to just under 6,000.

Jack: Thank you all for joining us. Today we shared a difficult decision with our team. We're reducing Block from over 10,000 people to just under 6,000. I said everything I needed to say to our team in an email I posted to Twitter. Please read it if you'd like. What I want to talk to you about now is why I believe this is the right path for our company and what Block looks like going forward. We're making this change after delivering one of our strongest years. We set clear priorities for the year. We executed on all of them. In 2025, gross profit growth more than doubled from Q1 to Q4. We surpassed Rule of 40 in Q4. We reignited Cash App network growth and engagement. We scaled our lending products and delivered strong returns.

Jack Dorsey: Thank you all for joining us. Today we shared a difficult decision with our team. We're reducing Block from over 10,000 people to just under 6,000. I said everything I needed to say to our team in an email I posted to Twitter. Please read it if you'd like. What I want to talk to you about now is why I believe this is the right path for our company and what Block looks like going forward. We're making this change after delivering one of our strongest years. We set clear priorities for the year. We executed on all of them. In 2025, gross profit growth more than doubled from Q1 to Q4. We surpassed Rule of 40 in Q4. We reignited Cash App network growth and engagement. We scaled our lending products and delivered strong returns.

Speaker #2: I said everything I needed to say to our team in an email posted to Twitter. So please read it if you'd like. What I want to talk to you about now is why I believe this is the right path for our company, and what block looks like going forward.

Speaker #2: We're making this change after delivering one of our strongest years. We set clear priorities for the year, and we executed on all of them.

Speaker #2: In 2025, gross profit growth more than doubled from the first quarter to the fourth quarter. We surpassed Rule of 40 in the fourth quarter.

Speaker #2: We reignited cash app network growth and engagement. We scaled our lending products and delivered strong returns. We accelerated Square GPV growth and had our strongest new volume added year on record.

Jack: We accelerated Square GPV growth and had our strongest new volume-added year on record. We shipped our first Proto units. We increased share repurchases to return more capital to shareholders. We have conviction in achieving the long-term financial targets we laid out at Investor Day and are meaningfully raising our initial outlook for 2026. We know how to grow this business, and this decision today is a choice about how we operate it going forward. The core thesis is simple: intelligence tools have changed what it means to build and run a company. We're already seeing it internally. A significantly smaller team using the tools we're building can do more and do it better. Intelligence tool capabilities are compounding faster every single week. I don't think we're early to this realization. I think most companies are late.

Jack Dorsey: We accelerated Square GPV growth and had our strongest new volume-added year on record. We shipped our first Proto units. We increased share repurchases to return more capital to shareholders. We have conviction in achieving the long-term financial targets we laid out at Investor Day and are meaningfully raising our initial outlook for 2026. We know how to grow this business, and this decision today is a choice about how we operate it going forward. The core thesis is simple: intelligence tools have changed what it means to build and run a company. We're already seeing it internally. A significantly smaller team using the tools we're building can do more and do it better. Intelligence tool capabilities are compounding faster every single week. I don't think we're early to this realization. I think most companies are late.

Speaker #2: We shipped our first proto units, and we increased share repurchases to return more capital to shareholders. We have conviction in achieving the long-term financial targets we laid out at Investor Day.

Speaker #2: And our meaningfully raising our initial outlook for 2026. We know how to grow this business, and this decision today is a choice about how we operate it going forward.

Speaker #2: The core thesis is simple. Intelligence tools have changed what it means to build and run a company. We're already seeing it internally. A significantly smaller team, using the tools we're building, can do more and do it better.

Speaker #2: Intelligence tool capabilities are compounding faster every single week. I don't think we're early to this realization. I think most companies are late. Within the next year, I believe the majority of companies will reach the same conclusion and make similar structural changes.

Jack: Within the next year, I believe the majority of companies will reach the same conclusion and make similar structural changes. I'd rather get there honestly and on our own terms than be forced into it reactively. This isn't just about efficiency. Block serves millions of customers, sellers, and consumers who are going to feel the economic effects of this same shift: small businesses that rely on us to get paid, to manage their money, to access capital, individuals navigating a financial landscape that's changing fast. Our job is to help them navigate it through it. That's not a new mission for us, but the urgency behind it is more pronounced, and the speed at which we need to deliver is accelerating. Here's how we're going to operate from here.

Jack Dorsey: Within the next year, I believe the majority of companies will reach the same conclusion and make similar structural changes. I'd rather get there honestly and on our own terms than be forced into it reactively. This isn't just about efficiency. Block serves millions of customers, sellers, and consumers who are going to feel the economic effects of this same shift: small businesses that rely on us to get paid, to manage their money, to access capital, individuals navigating a financial landscape that's changing fast. Our job is to help them navigate it through it. That's not a new mission for us, but the urgency behind it is more pronounced, and the speed at which we need to deliver is accelerating. Here's how we're going to operate from here.

Speaker #2: I'd rather get their honestly and on our own terms than be forced into it reactively. And this isn't just about efficiency. Block serves millions of customers, sellers and consumers who are going to feel the economic effects of this same shift.

Speaker #2: Small businesses that rely on us to get paid to manage their money, to access capital. Individuals navigating a financial landscape that's changing fast. Our job is to help them navigate it through it.

Speaker #2: That's not a new mission for us, but the urgency behind it is more pronounced. And the speed at which we need to deliver is accelerating.

Speaker #2: So here's how we're going to operate from here. First, intelligence will be at the core of how the entire company works. How we make decisions, how we build trust and manage risk, how we build products, and how we serve customers.

Jack: First, intelligence will be at the core of how the entire company works: how we make decisions, how we build trust and manage risk, how we build products, and how we serve customers. We're moving toward a model where our customers can build their own features directly on top of our capabilities. That changes the nature of what we are as a company and it dramatically increases the value we can deliver per customer. Second, extreme focus. There are four things we're going to focus on building now as a company: customer capabilities, interfaces where we can compose and deliver those capabilities, proactive intelligence based on our deep customer understanding and real-time data, and an intelligence model to fully orchestrate the company's operations. This allows us to best serve the master plan we laid out at Investor Day. Third, speed.

Jack Dorsey: First, intelligence will be at the core of how the entire company works: how we make decisions, how we build trust and manage risk, how we build products, and how we serve customers. We're moving toward a model where our customers can build their own features directly on top of our capabilities. That changes the nature of what we are as a company and it dramatically increases the value we can deliver per customer. Second, extreme focus. There are four things we're going to focus on building now as a company: customer capabilities, interfaces where we can compose and deliver those capabilities, proactive intelligence based on our deep customer understanding and real-time data, and an intelligence model to fully orchestrate the company's operations. This allows us to best serve the master plan we laid out at Investor Day. Third, speed.

Speaker #2: We're moving toward a model where our customers can build their own features directly on top of our capabilities, that changes the nature of what we are as a company, and it dramatically increases the value we can deliver for a customer.

Speaker #2: Second, extreme focus. There are four things we're going to focus on building now as a company. Customer capabilities, interfaces where we can compose and deliver those capabilities, proactive intelligence based on our deep customer understanding and real-time data, and an intelligence model to fully orchestrate the company's operations.

Speaker #2: This allows us to best serve the master plan we laid out at Investor Day. And third, speed. A company of our new size has no excuse for being slow.

Jack: A company of our new size has no excuse for being slow. We will decide faster, ship faster, and learn faster. The structure we're building is designed exactly for that. We believe Block will be significantly more valuable as a smaller, faster, intelligence-native company. Everything we do from here is in service of that. Amrita will now share more detail on the quarter and our outlook for the year.

Jack Dorsey: A company of our new size has no excuse for being slow. We will decide faster, ship faster, and learn faster. The structure we're building is designed exactly for that. We believe Block will be significantly more valuable as a smaller, faster, intelligence-native company. Everything we do from here is in service of that. Amrita will now share more detail on the quarter and our outlook for the year.

Speaker #2: We will decide faster, ship faster, and learn faster. The structure we're building is designed exactly for that. We believe Block will be significantly more valuable as a smaller, faster, intelligence-native company.

Speaker #2: Everything we do from here is in service of that. Amrita will now share more detail on the quarter and our outlook for the year.

Speaker #3: Thanks, Jack. And thank you all for joining. The organizational changes we're sharing today represent a deliberate choice about Block's next phase of growth. The decision impacts many employees who played an important role in building Block and were deeply grateful for their contributions.

Amrita: Thanks, Jack. Thank you all for joining. The organizational changes we're sharing today represent a deliberate choice about Block's next phase of growth. The decision impacts many employees who played an important role in building Block. We're deeply grateful for their contributions. As Jack mentioned, we're making this change after delivering a strong year across the business. In Q4, we outperformed our guidance across gross profit, adjusted operating income, and adjusted EPS, translating product velocity into strong financial performance. Block generated $2.87 billion in gross profit, representing 24% year-over-year growth. We grew adjusted operating income 46% year-over-year to $588 million, delivering 3 points of margin expansion even as we invested in initiatives with strong ROIs that we expect to drive future growth. On a per-share basis, we grew adjusted diluted EPS 38% year-over-year.

Amrita Ahuja: Thanks, Jack. Thank you all for joining. The organizational changes we're sharing today represent a deliberate choice about Block's next phase of growth. The decision impacts many employees who played an important role in building Block. We're deeply grateful for their contributions. As Jack mentioned, we're making this change after delivering a strong year across the business. In Q4, we outperformed our guidance across gross profit, adjusted operating income, and adjusted EPS, translating product velocity into strong financial performance. Block generated $2.87 billion in gross profit, representing 24% year-over-year growth. We grew adjusted operating income 46% year-over-year to $588 million, delivering 3 points of margin expansion even as we invested in initiatives with strong ROIs that we expect to drive future growth. On a per-share basis, we grew adjusted diluted EPS 38% year-over-year.

Speaker #3: As Jack mentioned, we're making this change after delivering a strong year. Across the business. In the fourth quarter, we outperformed our guidance across gross profit, adjusted operating income, and adjusted EPS.

Speaker #3: Translating product velocity into strong financial performance. Block generated $2.87 billion in gross profit, representing 24% year-over-year growth. And we grew adjusted operating income 46% year-over-year to $588 million.

Speaker #3: Delivering $3 points of margin expansion even as we invested in initiatives with strong ROIs that we expect to drive future growth. On a per-share basis, we grew adjusted diluted EPS 38% year-over-year.

Speaker #3: We repurchased $790 million of shares in the fourth quarter, bringing our total for 2025 to $2.3 billion. We exceeded Rule of 40 in Q4, and we believe we're on track to sustain it on an annual basis moving forward.

Amrita: We repurchased $790 million of shares in Q4, bringing our total for 2025 to $2.3 billion. We exceeded Rule of 40 in Q4, and we believe we're on track to sustain it on an annual basis moving forward. Stepping back, 2025 was a pivotal year for Block. Gross profit growth more than doubled from Q1 to Q4, leading to $10.36 billion in gross profit for the full year and growth of 17% year-over-year. Even with additional investment in go-to-market, we grew adjusted operating income 30% year-over-year in 2025, delivering 2 points of margin expansion. Cash App monthly actives returned to growth in the second half of 2025, ending the year at 59 million. We executed on our engagement strategies, with primary banking actives growing 22% year-over-year to 9.3 million monthly actives in December.

Amrita Ahuja: We repurchased $790 million of shares in Q4, bringing our total for 2025 to $2.3 billion. We exceeded Rule of 40 in Q4, and we believe we're on track to sustain it on an annual basis moving forward. Stepping back, 2025 was a pivotal year for Block. Gross profit growth more than doubled from Q1 to Q4, leading to $10.36 billion in gross profit for the full year and growth of 17% year-over-year. Even with additional investment in go-to-market, we grew adjusted operating income 30% year-over-year in 2025, delivering 2 points of margin expansion. Cash App monthly actives returned to growth in the second half of 2025, ending the year at 59 million. We executed on our engagement strategies, with primary banking actives growing 22% year-over-year to 9.3 million monthly actives in December.

Speaker #3: Stepping back, 2025 was a pivotal year for Block. Gross profit growth more than doubled from the first quarter to the fourth quarter, leading to $10.36 billion in gross profit for the full year.

Speaker #3: And growth of 17% year-over-year. Even with additional investment in go-to-market, we grew adjusted operating income 30% year-over-year in 2025, delivering $2 points of margin expansion.

Speaker #3: Cash app monthly actives returned to growth in the second half of 2025, ending the year at $59 million. And we executed on our engagement strategies with primary banking actives growing 22% year-over-year to $9.3 million monthly actives in December.

Speaker #3: We grew consumer lending origination volume by 50% year-over-year in 2025, while sustaining strong margins and healthy risk loss performance. We accelerated Square GPV growth from 8.6% in 2024 to 10% in 2025 and delivered our strongest year ever for new volume added or NVA as we expanded our distribution channels.

Amrita: We grew consumer lending origination volume by 50% year-over-year in 2025 while sustaining strong margins and healthy risk-loss performance. We accelerated Square GPV growth from 8.6% in 2024 to 10% in 2025 and delivered our strongest year ever for new volume added, or NVA, as we expanded our distribution channels. We continued to lean into our differentiated vertical integration and hardware design expertise with the launch of two new devices, Square Handheld and our second-generation Square Register, to better serve a wider range of seller use cases. We began shipping Proto mining rigs, with Proto gross profit scaling in Q4. Reviewing further some Q4 specifics, Cash App gross profit grew 33% year-over-year to $1.83 billion, accelerating relative to Q3. Throughout 2025, we've focused on reigniting Cash App network growth, and that work has paid off. In Q4, we grew monthly actives to 59 billion.

Amrita Ahuja: We grew consumer lending origination volume by 50% year-over-year in 2025 while sustaining strong margins and healthy risk-loss performance. We accelerated Square GPV growth from 8.6% in 2024 to 10% in 2025 and delivered our strongest year ever for new volume added, or NVA, as we expanded our distribution channels. We continued to lean into our differentiated vertical integration and hardware design expertise with the launch of two new devices, Square Handheld and our second-generation Square Register, to better serve a wider range of seller use cases. We began shipping Proto mining rigs, with Proto gross profit scaling in Q4. Reviewing further some Q4 specifics, Cash App gross profit grew 33% year-over-year to $1.83 billion, accelerating relative to Q3. Throughout 2025, we've focused on reigniting Cash App network growth, and that work has paid off. In Q4, we grew monthly actives to 59 billion.

Speaker #3: We continued to lean into our differentiated vertical integration and hardware design expertise with the launch of two new devices. Square handheld and our second-generation Square register, to better serve a wider range of seller use cases.

Speaker #3: We began shipping proto-mining rigs. With proto-gross profit scaling in the fourth quarter. Reviewing further some Q4 specifics, cash app gross profit grew 33% year-over-year to $1.83 billion.

Speaker #3: Accelerating relative to Q3. Throughout 2025, we've focused on reigniting cash app network growth. And that work has paid off. In Q4, we grew monthly actives to $59 billion.

Speaker #3: Our focus on deepening engagement is also working, with primary banking actives attached rate growing meaningfully in Q4. These customers have generated nearly 10 times the gross profit of peer-to-peer-only actives, and we believe they create a foundation for long-term inflows per active growth.

Amrita: Our focus on deepening engagement is also working, with primary banking actives attached rate growing meaningfully in Q4. These customers have generated nearly 10 times the gross profit of peer-to-peer-only actives, and we believe they create a foundation for long-term inflows per active growth. Cash App commerce enablement volume grew 17% year-over-year to $54.7 billion in Q4, driven by strength in Cash App Cards, where we saw the strongest quarter for new Cash App Card actives in over a year and saw Cash App Green drive increased retention and Cash App Card volume. Commerce monetization rate increased 4 basis points year-over-year as attached rates for Afterpay post-purchase continued to increase. We also grew consumer lending origination volume 69% year-over-year in the Q4, with consumer lending variable profit growth consistent with origination's growth. Within consumer lending origination volume, Borrow delivered an exceptional Q4, with origination volume growing more than 3 times year-over-year.

Amrita Ahuja: Our focus on deepening engagement is also working, with primary banking actives attached rate growing meaningfully in Q4. These customers have generated nearly 10 times the gross profit of peer-to-peer-only actives, and we believe they create a foundation for long-term inflows per active growth. Cash App commerce enablement volume grew 17% year-over-year to $54.7 billion in Q4, driven by strength in Cash App Cards, where we saw the strongest quarter for new Cash App Card actives in over a year and saw Cash App Green drive increased retention and Cash App Card volume. Commerce monetization rate increased 4 basis points year-over-year as attached rates for Afterpay post-purchase continued to increase. We also grew consumer lending origination volume 69% year-over-year in the Q4, with consumer lending variable profit growth consistent with origination's growth. Within consumer lending origination volume, Borrow delivered an exceptional Q4, with origination volume growing more than 3 times year-over-year.

Speaker #3: Cash app commerce enablement volume grew 17% year-over-year to $54.7 billion in Q4. Driven by strength in cash app cards. Where we saw the strongest quarter for new cash app card actives in over a year.

Speaker #3: And saw cash app green drive increased retention and cash app card volume. Commerce monetization rate increased four basis points year-over-year as attached rates for afterpay post-purchase continued to increase.

Speaker #3: We also grew consumer lending origination volume 69% year over year in the fourth quarter, with consumer lending variable profit growth consistent with originations' growth. Within consumer lending origination volume, Borrow delivered an exceptional fourth quarter.

Speaker #3: With origination volume growing more than three times year-over-year. We leaned into borrow offers for cash app green actives as one element of our new status program.

Amrita: We leaned into borrow offers for Cash App Green actives as one element of our new status program. Many customers deeply value access to liquidity. Beyond strong standalone unit economics, we've seen borrow drive deeper engagement across other parts of Cash App. Our lending strategy is focused on maximizing variable profit, scaling responsibly while maintaining disciplined risk management. That approach was on display in Q4 and early 2026. Q4 was the strongest quarter for first-time borrow actives ever, which drove higher portfolio losses in December and January based on the mix shift to new cohorts, which have higher losses by design. As of mid-February, all 2026 cohorts are trending below our risk-loss targets, demonstrating our ability to quickly calibrate risk and adjust exposure for new cohorts based on the strengths of our underwriting team, product design, and our proprietary data and credit infrastructure.

Amrita Ahuja: We leaned into borrow offers for Cash App Green actives as one element of our new status program. Many customers deeply value access to liquidity. Beyond strong standalone unit economics, we've seen borrow drive deeper engagement across other parts of Cash App. Our lending strategy is focused on maximizing variable profit, scaling responsibly while maintaining disciplined risk management. That approach was on display in Q4 and early 2026. Q4 was the strongest quarter for first-time borrow actives ever, which drove higher portfolio losses in December and January based on the mix shift to new cohorts, which have higher losses by design. As of mid-February, all 2026 cohorts are trending below our risk-loss targets, demonstrating our ability to quickly calibrate risk and adjust exposure for new cohorts based on the strengths of our underwriting team, product design, and our proprietary data and credit infrastructure.

Speaker #3: Many customers deeply value access to liquidity, and beyond strong standalone unit economics, we've seen Borrow drive deeper engagement across other parts of Cash App.

Speaker #3: Our lending strategy is focused on maximizing variable profit. Scaling responsibly while maintaining disciplined risk management. That approach was on display in Q4 and early 2026.

Speaker #3: Q4 was the strongest quarter for first-time borrow actives ever, which drove higher portfolio losses in December and January based on the mix shift to new cohorts, which have higher losses by design.

Speaker #3: As of mid-February, all 2026 cohorts are trending below our risk loss targets, demonstrating our ability to quickly calibrate risk and adjust exposure for new cohorts based on the strengths of our underwriting team, product design, and our proprietary data and credit infrastructure.

Speaker #3: Turning to Square, where our distribution motion has continued to gain traction. 2025 was our strongest year ever for NVA growth of 17%, with growth of 17%.

Amrita: Turning to Square, where our distribution motion has continued to gain traction, 2025 was our strongest year ever for NVA growth of 17%. That momentum continued into Q4, with 29% year-over-year NVA growth. We saw progress across both marketing-led self-onboarding and sales channels, with sales-led NVA growing 62% year-over-year in Q4. In addition, we now partner with over 100 independent sales organizations, complementing our direct sales motion and extending our reach to more new sellers. GPV grew 10.3% in Q4, and we've seen growth reaccelerate so far in Q1, with growth quarter to date, as of February 24th, of over 12% year-over-year. Square gross profit grew 7.5% year-over-year in Q4, driven by growth in financial solutions.

Amrita Ahuja: Turning to Square, where our distribution motion has continued to gain traction, 2025 was our strongest year ever for NVA growth of 17%. That momentum continued into Q4, with 29% year-over-year NVA growth. We saw progress across both marketing-led self-onboarding and sales channels, with sales-led NVA growing 62% year-over-year in Q4. In addition, we now partner with over 100 independent sales organizations, complementing our direct sales motion and extending our reach to more new sellers. GPV grew 10.3% in Q4, and we've seen growth reaccelerate so far in Q1, with growth quarter to date, as of February 24th, of over 12% year-over-year. Square gross profit grew 7.5% year-over-year in Q4, driven by growth in financial solutions.

Speaker #3: That momentum continued into the fourth quarter, with 29% year-over-year NVA growth. We saw progress across both marketing-led self-onboarding and sales channels. With sales-led NVA growing 62% year-over-year in Q4.

Speaker #3: In addition, we now partner with over 100 independent sales organizations complementing our direct sales motion and extending our reach to more new sellers. GPV grew 10.3% in Q4, and we've seen growth re-accelerate so far in Q1.

Speaker #3: With growth quarter to date as of February 24th of over 12% year-over-year. Square gross profit grew 7.5% year-over-year in Q4, driven by growth in financial solutions.

Speaker #3: Hardware costs and higher processing costs were each a 2 percentage point headwind to Square gross profit growth in Q4, consistent with the expectations shared at our investor day.

Amrita: Hardware costs and higher processing costs were each a 2 percentage point headwind to Square gross profit growth in Q4, consistent with the expectations shared at our Investor Day. Looking ahead, we expect our new organizational design to increase velocity. We have seen significant improvement in AI tooling capabilities. We've seen engineering work that would have taken weeks to complete be done by a small team in a fraction of the time with agentic coding tools. These are reflected in our developer velocity metrics, where we've seen a greater than 40% increase in production code shift per engineer since September. We've been prioritizing automation in how we build internally for the past couple of years as we've built bespoke tools and increased AI adoption. Some of our automation workstreams are nearly fully rolled out. Others are earlier in their maturity.

Amrita Ahuja: Hardware costs and higher processing costs were each a 2 percentage point headwind to Square gross profit growth in Q4, consistent with the expectations shared at our Investor Day. Looking ahead, we expect our new organizational design to increase velocity. We have seen significant improvement in AI tooling capabilities. We've seen engineering work that would have taken weeks to complete be done by a small team in a fraction of the time with agentic coding tools. These are reflected in our developer velocity metrics, where we've seen a greater than 40% increase in production code shift per engineer since September. We've been prioritizing automation in how we build internally for the past couple of years as we've built bespoke tools and increased AI adoption. Some of our automation workstreams are nearly fully rolled out. Others are earlier in their maturity.

Speaker #3: Looking ahead, we expect our new organizational design to increase velocity. We have seen significant improvement in AI tooling capabilities. We've seen engineering work that would have taken weeks to complete be done by a small team in a fraction of the time with agentic coding tools.

Speaker #3: These are reflected in our developer velocity metrics, where we've seen a greater than 40% increase in production code shift per engineer since September. We've been prioritizing automation in how we build internally for the past couple of years.

Speaker #3: As we've built bespoke tools and increased AI adoption. Some of our automation work streams are nearly fully rolled out. Others are earlier in their maturity.

Speaker #3: And we expect to continue to develop automation improvements in parallel with the advancements of the underlying technology. The outcomes we have seen are encouraging, and the long-term impact will depend on thoughtful implementation at scale.

Amrita: We expect to continue to develop automation improvements in parallel with the advancements of the underlying technology. The outcomes we have seen are encouraging, and the long-term impact will depend on thoughtful implementation at scale. We're taking this decisive action from a position of strength. Gross profit growth accelerated throughout 2025, and we expect to sustain strong growth in 2026 with execution across a portfolio of ramping or new initiatives in Square and Cash App. In Cash App, we expect to compound our gains in our banking and commerce ecosystems, scale Cash App Green further, and expand Moneybot to our full customer base in the coming weeks and months. We launched Afterpay pre-purchase in February with strong early indications of demand and expect to scale it throughout the year. We also recently launched Pay in 4 Buy Now Pay Later functionality for peer-to-peer transactions, which is a first for the industry.

Amrita Ahuja: We expect to continue to develop automation improvements in parallel with the advancements of the underlying technology. The outcomes we have seen are encouraging, and the long-term impact will depend on thoughtful implementation at scale. We're taking this decisive action from a position of strength. Gross profit growth accelerated throughout 2025, and we expect to sustain strong growth in 2026 with execution across a portfolio of ramping or new initiatives in Square and Cash App. In Cash App, we expect to compound our gains in our banking and commerce ecosystems, scale Cash App Green further, and expand Moneybot to our full customer base in the coming weeks and months. We launched Afterpay pre-purchase in February with strong early indications of demand and expect to scale it throughout the year. We also recently launched Pay in 4 Buy Now Pay Later functionality for peer-to-peer transactions, which is a first for the industry.

Speaker #3: We're taking this decisive action from a position of strength. Gross profit growth accelerated throughout 2025, and we expect to sustain strong growth in 2026, with execution across a portfolio of ramping or new initiatives in Square and Cash App.

Speaker #3: In Cash App, we expect to compound our gains in our banking and commerce ecosystems, scale cash app green further, and expand money bot to our full customer base in the coming weeks and months.

Speaker #3: We launched Afterpay pre-purchase in February, with strong early indications of demand and expect to scale it throughout the year. We also recently launched Pay in 4 Buy Now Pay Later functionality for peer-to-peer transactions, which is a first for the industry.

Speaker #3: Our focus is to ramp these products along with borrow while maintaining healthy loss rates. In Square, we expect to ramp go-to-market motions further across self-onboarding, sales, and partnerships.

Amrita: Our focus is to ramp these products along with borrow while maintaining healthy loss rates. In Square, we expect to ramp go-to-market motions further across self-onboarding, sales, and partnerships. We're focused on excellence in our food and beverage products and accelerating product velocity across other verticals to continue to drive net volume retention higher. We recently launched Square AI to all markets and are excited to deliver more proactive intelligence capabilities to our sellers as we build towards ManagerBot. We continue to be focused on connecting our ecosystems and believe we're finding product-market fit with neighborhoods. Our focus now is on scaling. We're moving from an inbound motion to an auto-enrollment motion for sellers. We recently added in-store redemption capabilities to increase functionality for consumers and widen the addressable market to more sellers. Our guidance reflects this product velocity momentum.

Amrita Ahuja: Our focus is to ramp these products along with borrow while maintaining healthy loss rates. In Square, we expect to ramp go-to-market motions further across self-onboarding, sales, and partnerships. We're focused on excellence in our food and beverage products and accelerating product velocity across other verticals to continue to drive net volume retention higher. We recently launched Square AI to all markets and are excited to deliver more proactive intelligence capabilities to our sellers as we build towards ManagerBot. We continue to be focused on connecting our ecosystems and believe we're finding product-market fit with neighborhoods. Our focus now is on scaling. We're moving from an inbound motion to an auto-enrollment motion for sellers. We recently added in-store redemption capabilities to increase functionality for consumers and widen the addressable market to more sellers. Our guidance reflects this product velocity momentum.

Speaker #3: We're focused on excellence in our food and beverage products and accelerating product velocity across other verticals. To continue to drive net volume retention higher.

Speaker #3: We recently launched Square AI to all markets and are excited to deliver more proactive intelligence capabilities to our sellers as we build towards manager bot.

Speaker #3: We continue to be focused on connecting our ecosystems and believe we're finding product-market fit with neighborhoods. Our focus now is on scaling. We're moving from an inbound motion to an auto-enrollment motion for sellers and we recently added in-store redemption capabilities to increase functionality for consumers and widen the addressable market to more sellers.

Speaker #3: Our guidance reflects this product velocity momentum. For the full year, we expect year-over-year gross profit growth of 18% to 12.2 billion dollars and increase relative to our investor day guidance and an acceleration relative to what we delivered in 2025.

Amrita: For the full year, we expect year-over-year gross profit growth of 18% to $12.2 billion, an increase relative to our Investor Day guidance and an acceleration relative to what we delivered in 2025. For Q1, we expect year-over-year gross profit growth of 22% to $2.8 billion. In addition to the growth momentum we're seeing, our guidance also reflects a smaller cost structure going forward. We believe the actions we're taking today will enable us to deliver faster product innovation for customers in the future while also enabling us to invest meaningfully in our business. With this change in cost structure combined with the investments we plan to make, we are increasing our guidance for Adjusted Operating Income in 2026 to $3.2 billion, reflecting year-over-year growth of 54% and six points of margin expansion relative to 2025.

Amrita Ahuja: For the full year, we expect year-over-year gross profit growth of 18% to $12.2 billion, an increase relative to our Investor Day guidance and an acceleration relative to what we delivered in 2025. For Q1, we expect year-over-year gross profit growth of 22% to $2.8 billion. In addition to the growth momentum we're seeing, our guidance also reflects a smaller cost structure going forward. We believe the actions we're taking today will enable us to deliver faster product innovation for customers in the future while also enabling us to invest meaningfully in our business. With this change in cost structure combined with the investments we plan to make, we are increasing our guidance for Adjusted Operating Income in 2026 to $3.2 billion, reflecting year-over-year growth of 54% and six points of margin expansion relative to 2025.

Speaker #3: For Q1, we expect year-over-year gross profit growth of 22% to 2.8 billion dollars. In addition to the growth momentum we're seeing, our guidance also reflects a smaller cost structure going forward.

Speaker #3: We believe the actions we're taking today will enable us to deliver faster product innovation for customers in the future, while also enabling us to invest meaningfully in our business.

Speaker #3: With this change in cost structure, combined with the investments we plan to make, we are increasing our guidance for adjusted operating income in 2026 to 3.2 billion dollars, reflecting year-over-year growth of 54% and six points of margin expansion relative to 2025.

Speaker #3: We are increasing our expectation for adjusted diluted EPS in 2026 to $3.66, also reflecting year-over-year growth of 54%. For Q1, we expect adjusted operating income of 600 million dollars and adjusted diluted EPS of 67 cents.

Amrita: We are increasing our expectation for adjusted diluted EPS in 2026 to $3.66, also reflecting year-over-year growth of 54%. For Q1, we expect adjusted operating income of $600 million and adjusted diluted EPS of $0.67, reflecting year-over-year growth of 29% and 20%, respectively. Before wrapping up, a few additional considerations related to our guidance. Our Q1 operating income guidance includes a modest benefit from today's announcement, but we expect the organizational changes we announced today to begin to more meaningfully impact adjusted operating income in Q2, with the full impact of our new cost structure more meaningfully improving profitability in the second half of the year. Given these timing dynamics and the pacing of investments in both risk loss and sales and marketing, we expect adjusted operating income margins to expand each quarter throughout the year from our Q1 starting point of 21%.

Amrita Ahuja: We are increasing our expectation for adjusted diluted EPS in 2026 to $3.66, also reflecting year-over-year growth of 54%. For Q1, we expect adjusted operating income of $600 million and adjusted diluted EPS of $0.67, reflecting year-over-year growth of 29% and 20%, respectively. Before wrapping up, a few additional considerations related to our guidance. Our Q1 operating income guidance includes a modest benefit from today's announcement, but we expect the organizational changes we announced today to begin to more meaningfully impact adjusted operating income in Q2, with the full impact of our new cost structure more meaningfully improving profitability in the second half of the year. Given these timing dynamics and the pacing of investments in both risk loss and sales and marketing, we expect adjusted operating income margins to expand each quarter throughout the year from our Q1 starting point of 21%.

Speaker #3: Reflecting year-over-year growth of 29% and 20% respectively. Before wrapping up, a few additional considerations related to our guidance. Our Q1 operating income guidance includes a modest benefit from today's announcement, but we expect the organizational changes we announced today to begin to more meaningfully impact adjusted operating income in the second quarter.

Speaker #3: With the full impact of our new cost structure more meaningfully improving profitability in the second half of the year. Given these timing dynamics and the pacing of investments in both risk loss and sales and marketing, we expect adjusted operating income margins to expand each quarter throughout the year from our Q1 starting point of 21%.

Speaker #3: We expect these margins to expand at a faster rate in Q3 and Q4 relative to Q2, and we expect to deliver just under 60% of our 2026 adjusted operating income guidance in the second half of the year.

Amrita: We expect these margins to expand at a faster rate in Q3 and Q4 relative to Q2, and we expect to deliver just under 60% of our 2026 Adjusted Operating Income guidance in the second half of the year. Within OPEX, we expect higher risk loss growth in the first half of the year based on our strong borrow growth rate expectations in Q1 and Q2. In Square, we continue to expect gross profit growth to be roughly in line with GPV growth later in the second half of the year. In the first half, we anticipate a continued spread between gross profit and GPV growth with some potential variability driven by hardware costs and the pace at which we move up market.

Amrita Ahuja: We expect these margins to expand at a faster rate in Q3 and Q4 relative to Q2, and we expect to deliver just under 60% of our 2026 Adjusted Operating Income guidance in the second half of the year. Within OPEX, we expect higher risk loss growth in the first half of the year based on our strong borrow growth rate expectations in Q1 and Q2. In Square, we continue to expect gross profit growth to be roughly in line with GPV growth later in the second half of the year. In the first half, we anticipate a continued spread between gross profit and GPV growth with some potential variability driven by hardware costs and the pace at which we move up market.

Speaker #3: Within OPEX, we expect higher risk loss growth in the first half of the year based on our strong borrow growth rate expectations in Q1 and Q2.

Speaker #3: In Square, we continue to expect gross profit growth to be roughly in line with GPV growth later in the second half of the year.

Speaker #3: In the first half, we anticipate a continued spread between gross profit and GPV growth, with some potential variability driven by hardware costs and the pace at which we move up market.

Speaker #3: We view Square gross profit growth excluding hardware costs as a clear measure of core profitability as we view hardware to be a customer acquisition investment to win larger, more retentive sellers.

Amrita: We view Square gross profit growth excluding hardware costs as a clear measure of core profitability, as we view hardware to be a customer acquisition investment to win larger, more retentive sellers. We expect increasing software attached rates to be a key driver of gross profit growth acceleration. We expect to continue to evolve our pricing and packaging to ensure appropriate price-to-value while delivering attractive total cost of ownership for sellers. We have strong conviction in Cash App strategies to grow its network and deepen engagement, which have helped drive 2 quarters of sequential active growth across monthly actives and primary banking actives. While monthly actives may fluctuate from time to time, we continue to expect low single-digit active growth in 2026 and over the long term.

Amrita Ahuja: We view Square gross profit growth excluding hardware costs as a clear measure of core profitability, as we view hardware to be a customer acquisition investment to win larger, more retentive sellers. We expect increasing software attached rates to be a key driver of gross profit growth acceleration. We expect to continue to evolve our pricing and packaging to ensure appropriate price-to-value while delivering attractive total cost of ownership for sellers. We have strong conviction in Cash App strategies to grow its network and deepen engagement, which have helped drive 2 quarters of sequential active growth across monthly actives and primary banking actives. While monthly actives may fluctuate from time to time, we continue to expect low single-digit active growth in 2026 and over the long term.

Speaker #3: We expect increasing software attach rates to be a key driver of gross profit growth acceleration, and we expect to continue to evolve our pricing and packaging to ensure appropriate price-to-value, while delivering attractive total cost of ownership for sellers.

Speaker #3: We have strong conviction in Cash App strategies to grow its network and deepen engagement, which have helped drive two quarters of sequential active growth across monthly actives and primary banking actives.

Speaker #3: While monthly actives may fluctuate from time to time, we continue to expect low single-digit active growth in 2026 and over the long term. We expect approximately 60 million dollars in net interest expense in Q1 and 200 million dollars for the full year, up modestly from the quarter earnings call as we deployed more capital in the buybacks and borrow growth in the fourth quarter.

Amrita: We expect approximately $60 million in net interest expense in Q1 and $200 million for the full year, up modestly from the expectations we shared on our Q3 earnings call as we deployed more capital in the buybacks and borrow growth in the Q4. Finally, similar to last quarter, we expect a mid-20% non-GAAP effective tax rate in 2026. With that, I'd like to open up the call to Q&A.

Amrita Ahuja: We expect approximately $60 million in net interest expense in Q1 and $200 million for the full year, up modestly from the expectations we shared on our Q3 earnings call as we deployed more capital in the buybacks and borrow growth in the Q4. Finally, similar to last quarter, we expect a mid-20% non-GAAP effective tax rate in 2026. With that, I'd like to open up the call to Q&A.

Speaker #3: And finally, similar to last quarter, we expect a mid-20% non-GAAP effective tax rate in 2026. And with that, I'd like to open up the call to Q&A.

Speaker #1: Now we will begin the Q&A portion of the call. Please click the raise hand feature to ask a question. Please limit yourself to one question.

Operator: Now we will begin the Q&A portion of the call. Please click the raise hand feature to ask a question. Please limit yourself to one question. Our first question comes from the line of Tien-Tsin Huang from JP Morgan.

Speaker #1: Our first question comes from the line of Tin Tin Huang from JPMorgan.

Speaker #3: Hi, thanks, Sophie. Can you hear me okay?

Jack: I think so. If you can hear me okay?

Jack Dorsey: I think so. If you can hear me okay?

Speaker #4: Yeah.

Amrita: Yeah.

Tien-tsin Huang: Yeah.

Speaker #3: All right. Perfect. Yeah, Jack, I did want to ask a question to you if you don't mind. And knowing you here, I'm sure you put a lot of heavy thought into this reduction in four.

Jack: All right.

Jack Dorsey: All right.

Amrita: Perfect. Yeah, Jack, I did want to ask a question to you if you don't mind. Knowing you here, I'm sure you put a lot of heavy thought into this reduction in 4. I'd love to just hear a little bit more on why now. We're just, what, 3 months removed from Investor Day. Why are you ready to make this change now, and why is this the right level to run the company at? Thanks. Yeah. There's a few things that have all been compounding towards this moment in this time. As you know, we have been working very hard to functionalize the company. That's a big part of what gives us more confidence in making this move. We were operating a company with basically 2 companies inside of it, both having their own structure, a lot of duplication.

Tien-tsin Huang: Perfect. Yeah, Jack, I did want to ask a question to you if you don't mind. Knowing you here, I'm sure you put a lot of heavy thought into this reduction in 4. I'd love to just hear a little bit more on why now. We're just, what, 3 months removed from Investor Day. Why are you ready to make this change now, and why is this the right level to run the company at? Thanks.

Speaker #3: So I'd love to just hear a little bit more on why now. We're just, what, three months removed from investor day. So why are you ready to make this change now and why is this the right level to run the company at?

Speaker #3: Thanks.

Speaker #4: Yeah. There's a few things that have all been confounding towards this moment in this time. As you know, we have been working very hard to functionalize the company.

Jack Dorsey: Yeah. There's a few things that have all been compounding towards this moment in this time. As you know, we have been working very hard to functionalize the company. That's a big part of what gives us more confidence in making this move. We were operating a company with basically 2 companies inside of it, both having their own structure, a lot of duplication.

Speaker #4: That's a big part of what gives us more confidence in making this move. We were operating a company with basically two companies with inside of it, both having their own structure.

Speaker #4: A lot of duplication. And as we functionalized it, allowed us to act more like one company and recognize where there are common capabilities and common foundation.

Amrita: As we functionalized, it allowed us to act more like one company and recognize where there are common capabilities and common foundation. We're still doing a lot of that work, but I have the confidence that we're in a place that we can move much faster there. I also believe we were the first agentic harness out in the market. This is goose. Something happened in December of last year, just last year, where the models just got in order of magnitude more capable and more intelligent. It's really shown a path forward in terms of us being able to apply it to nearly every single thing that we do. If there are any gaps in our usage of AI right now, it's an application gap.

Jack Dorsey: As we functionalized, it allowed us to act more like one company and recognize where there are common capabilities and common foundation. We're still doing a lot of that work, but I have the confidence that we're in a place that we can move much faster there. I also believe we were the first agentic harness out in the market. This is goose. Something happened in December of last year, just last year, where the models just got in order of magnitude more capable and more intelligent. It's really shown a path forward in terms of us being able to apply it to nearly every single thing that we do. If there are any gaps in our usage of AI right now, it's an application gap.

Speaker #4: And we're still doing a lot of that work, but I have the confidence that we're in a place that we can move much faster there.

Speaker #4: I also believe we were one of the first we were the first agentic harness out in the market. This is Goose. But something happened in December of last year, just last year, where the models just got in order of magnitude more capable and more intelligent.

Speaker #4: And it's really shown a path forward in terms of us being able to apply it to nearly every single thing that we do. So if there are any gaps in our usage of AI right now, it's a application gap.

Speaker #4: And I'm really confident that we can go through the majority of our organization, certainly our development, but the majority of our organization and apply these tools in a much stronger way that has the effect of allowing us to ship much faster to explore a lot of the paths much broader so we can run the right experiments and get to the right answers product market fit.

Amrita: I'm really confident that we can go through the majority of our organization, certainly our development, but the majority of our organization, and apply these tools in a much stronger way that has the effect of allowing us to ship much faster, to explore a lot of the paths much broader so we can run the right experiments and get to the right answers and get feedback immediately for product-market fit, and ultimately to operate more and more of the company in a way that I think all companies will eventually go. I do think the tools are at a state right now where every single company out there is going to run and grow in a fundamentally different way and be structured in a fundamentally different way. A big part of me wanting to do this right now is I wanted to get ahead of it.

Jack Dorsey: I'm really confident that we can go through the majority of our organization, certainly our development, but the majority of our organization, and apply these tools in a much stronger way that has the effect of allowing us to ship much faster, to explore a lot of the paths much broader so we can run the right experiments and get to the right answers and get feedback immediately for product-market fit, and ultimately to operate more and more of the company in a way that I think all companies will eventually go. I do think the tools are at a state right now where every single company out there is going to run and grow in a fundamentally different way and be structured in a fundamentally different way. A big part of me wanting to do this right now is I wanted to get ahead of it.

Speaker #4: And ultimately, to operate more and more of the company in a way that I think all companies will eventually go. I do think the tools are at a state right now where every single company out there is going to run and grow in a fundamentally different way.

Speaker #4: And be structured in a fundamentally different way. And a big part of me wanting to do this right now is I wanted to get ahead of it.

Speaker #4: And I'm confident that we've laid the foundation in order to do that and to push really fast to get there. So we're in a place where a lot of what we've been working with and all these threads are coming together in the right moment.

Amrita: I'm confident that we've laid the foundation in order to do that and to push really fast to get there. We're in a place where a lot of what we've been working with and all these threads are coming together in the right moment. I want to make sure that we're ahead of the market, ahead of our customers' expectations, and actually building for the future. I do believe that a lot of the expectation going forward is not just that we deliver intelligence to our customers through ManagerBot and Moneybot, for instance, but the very end of that is that they can build their own features and build their own visualizations on top of our capabilities through our interfaces. We have incredible distribution. We have incredible understanding in real time of real transactional data on both sides of the counter.

Jack Dorsey: I'm confident that we've laid the foundation in order to do that and to push really fast to get there. We're in a place where a lot of what we've been working with and all these threads are coming together in the right moment. I want to make sure that we're ahead of the market, ahead of our customers' expectations, and actually building for the future. I do believe that a lot of the expectation going forward is not just that we deliver intelligence to our customers through ManagerBot and Moneybot, for instance, but the very end of that is that they can build their own features and build their own visualizations on top of our capabilities through our interfaces. We have incredible distribution. We have incredible understanding in real time of real transactional data on both sides of the counter.

Speaker #4: And I want to make sure that we're ahead of the market, ahead of our customers' expectations, and actually building for the future. And I do believe that a lot of the expectation going forward is not just that we deliver intelligence to our customers through manager bot and money bot, for instance, but the very end of that is that they can build their own features and build their own visualizations on top of our capabilities through our interfaces.

Speaker #4: We have incredible distribution. We have incredible understanding in real time of real transactional data on both sides of the counter. And we can proactively prompt our customers and we can proactively compose interfaces that will fit the task before them, which I think is quite unique.

Amrita: We can proactively prompt our customers. We can proactively compose interfaces that will fit the task before them, which I think is quite unique and not something that you can find certainly at other companies in our space, but also more broadly in technology. I intend that we win in this space and that we grow and bring this intelligence to both sellers and to individuals and, ideally, to bring them together into this one ecosystem we're calling neighborhoods.

Tien-tsin Huang: We can proactively prompt our customers. We can proactively compose interfaces that will fit the task before them, which I think is quite unique and not something that you can find certainly at other companies in our space, but also more broadly in technology. I intend that we win in this space and that we grow and bring this intelligence to both sellers and to individuals and, ideally, to bring them together into this one ecosystem we're calling neighborhoods.

Speaker #4: And not something that you can find certainly at other companies in our space, but also more broadly in technology. And I intend that we win in this space and that we grow and bring this intelligence to both sellers and to individuals and ideally to bring them together into this one ecosystem we're calling neighborhoods.

Speaker #1: Our next question comes from the line of Darren Peller with Wolf Research.

Operator: Our next question comes from the line of Darrin Peller with Wolfe Research.

Speaker #5: Hey, thanks, guys. You can hear me okay?

Darrin Peller: Hey, thanks, guys. You can hear me okay?

Speaker #1: Loud and clear.

Operator: Loud and clear.

Speaker #5: Yep. Okay. Great. Look, I mean, there are some very strong trends, especially in cash app, considering users growing again, inflows per active growth accelerating, double digits, and also on square.

Darrin Peller: Yep. Okay, great. Look, I mean, there are some very strong trends, especially in Cash App, considering users growing again, inflows for active growth accelerating, double digits. Also on Square, we're seeing new sales helping with NVA accelerate nearly 30%. If you could just touch on what you think drives sustainable momentum across both the businesses, and especially in light of the reduced headcount levels, just want to touch on how you're sustaining this and how you really expect to sustain solid momentum like this as shown in your guidance, again, just given the changes in the business. Thanks, guys. Thanks, John.

Speaker #5: We're seeing new sales helping with NVA accelerate nearly 30%. Just if you could just touch on what you think drives sustainable momentum across both the businesses and especially in light of the reduced headcount levels.

Speaker #5: Just want to touch on how you're sustaining this and how you really expect to sustain solid momentum like this as shown in your guidance.

Speaker #5: Again, just given the changes in the business. Thanks, guys.

Speaker #6: Sure. I think we have a lot of conviction in our ability to sustain these durable growth rates. I think that there are two high-level ways to answer your question.

[Company Representative] (Block): Sure. I think we have a lot of conviction in our ability to sustain these durable growth rates. I think that there's two high-level ways to answer your question. The first is just around the org structure and the org size and what does that mean. The second probably is just from a product development and roadmap standpoint, how are we feeling? On the org structure side, to reiterate some of what Jack was talking about, what we've seen is that smaller, more nimble teams have allowed us to move faster and actually get products into our customers' hands more quickly. With the moves today, we are eliminating some of the organizational debt or organizational overhang that has existed. We're also inherently increasing talent density across the org, including the development org.

Speaker #6: The first is just around the org structure and the org size and what does that mean. And then the second probably is just from a product development and roadmap standpoint, how are we feeling?

Speaker #6: So on the org structure side, to reiterate some of what Jack was talking about, what we've seen is that smaller more nimble teams have allowed us to move faster and actually get products into our customers' hands more quickly.

Speaker #6: With the moves today, we are eliminating some of the organizational debt or organizational overhang that has existed. We're also inherently increasing talent density across the org, including the development org.

Speaker #6: And obviously, we're getting all of the benefits of the AI tools and the improvements in the foundational models. And that's flowing through to everything that we're doing, particularly on the software development side.

[Company Representative] (Block): Obviously, we're getting all of the benefits of the AI tools and the improvements in the foundational models. That's flowing through to everything that we're doing, particularly on the software development side. I'd say overall, on the org structure and org size side of things, we're feeling really confident, and we're actually feeling like this is going to help us execute more quickly and with more precision. On the second category, which is just product development roadmap and the growth levers that we have, again, we have really strong conviction in our roadmap and how that's going to flow through to gross profit growth. I think the clearest signal is, in my mind, it's the increase to the gross profit guide that we gave today. I would tend to break this down into a few different categories.

Speaker #6: So I'd say overall on the org structure and org side, side of things, we're feeling really confident and we're actually feeling like this is going to help us execute more quickly and with more precision.

Speaker #6: On the second category, which is just product development roadmap and the growth levers that we have, again, we have really strong conviction in our roadmap and how that's going to flow through to gross profit growth.

Speaker #6: I think the clearest signal is in my mind, it's the increase to the gross profit guide, that we gave today. But I would tend to break this down into a few different categories.

Speaker #6: I think we have first just the core network growth of cash app and square. Then we have key product launches that we're planning on in the coming months and quarters that are very high conviction.

[Company Representative] (Block): I think we have, first, just the core network growth of Cash App and Square. We have key product launches that we're planning on in the coming months and quarters that are very high conviction. Last, we have some of the bigger bets. I think those are green across the board. We continue to have teams that are focused on core network growth, whether that's active growth and inflows for active growth on the Cash App and Afterpay side, or whether that's teams focused on net volume retention and driving new GPV on the Square side.

Speaker #6: And then last, we have some of the bigger bets. I think those are green across the board. So we continue to have teams that are focused on core network growth, whether that's actives growth and inflows per active growth on the cash app and after-pay side, or whether that's teams focused on net volume retention and driving new GPV on the square side.

Speaker #6: From a product launch perspective, we have a ton of things that we've been shipping over the past few weeks and things that are coming down the pike from how we're thinking about improvements and enhancements to cash app green, how we're thinking about scaling cash app card functionality and Bitcoin improvements that we're making after paying the cash card pre-purchase just rolled out to the initial cohort a few weeks ago and we're seeing really, really encouraging signs there in early data.

[Company Representative] (Block): From a product launch perspective, we have a ton of things that we've been shipping over the past few weeks and things that are coming down the pike, from how we're thinking about improvements and enhancements to Cash App Green, how we're thinking about scaling Cash App Card functionality and growing Cash App Pay, the Bitcoin improvements that we're making. Afterpay, the Cash App Card pre-purchase just rolled out to the initial cohort a few weeks ago, and we're seeing really, really encouraging signs there in early data. Similarly, on the Square side, we've shipped a number of key features that drive that food and beverage excellence. We have a number of other features that are coming down the pike in the coming months. We're continuing to refine our pricing and packaging. The list goes on.

Speaker #6: Similarly, on the square side, we've shipped a number of key features that drive at food and beverage excellence. We have a number of other features that are coming down the pike in the coming months.

Speaker #6: We're continuing to refine our pricing and packaging. The list goes on. And so we feel really confident in those levers and how they're going to flow through.

[Company Representative] (Block): We feel really confident in those levers and how they're going to flow through. Of course, it's not just about the near-term growth. It's also, how are you investing in a way that's going to drive that durable growth over time? We have part of our development portfolio allocated to things like neighborhoods and scaling neighborhoods to MoneyBot, to ManagerBot, to Cash App credit score, a lot of which we think kind of represent the future of the product experience for our interfaces at Block and which should drive gross profit growth, not just this year, but into the future. Overall, we're feeling really confident in our ability to sustain these healthy growth rates.

Speaker #6: But then, of course, it's not just about the near-term growth. It's also how are you investing in a way that's going to drive that durable growth over time.

Speaker #6: And so we have part of our development portfolio allocated to things like neighborhoods and scaling neighborhoods to money bot, to manager bot, to cash app credit score, a lot of which we think kind of represent the future of the product experience for our interfaces at Block.

Speaker #6: And which should drive gross profit growth, not just this year, but into the future. So overall, we're feeling really confident in our ability to sustain these healthy growth rates.

Speaker #1: Our next question comes from the line of Ramsey El-Assal with Contour Fitzgerald.

Operator: Our next question comes from the line of Ramsey El-Assal with Cantor Fitzgerald.

Speaker #5: Ramsey, we can't hear you. We may have to unmute.

Andrew Schmidt: Ramsey, we can't hear you. You may have to unmute.

Jack Dorsey: Ramsey, we can't hear you. You may have to unmute.

Speaker #1: Our next question comes from the line of Brian Bergen with TD Kellen.

Operator: Our next question comes from the line of Bryan Bergin with TD Cowen.

Speaker #7: Hi, guys. Thank you. Hope you can hear me. I wanted to just follow up on the org changes and hoping you could talk more about how those changes today may flow through the financial outlook this year and potentially beyond.

Bryan Bergin: Hi, guys. Thank you. Hope you can hear me. I wanted to just follow up on the org changes and hoping you could talk more about how those changes today may flow through the financial outlook this year and potentially beyond. I appreciate the cadence, Color. Just wanted to follow up on those cost impacts and how that may translate to where you can exit 2026 on AOI. Any important free cash flow impacts to be mindful of as well there as you go through 2026 and beyond? Just also, where are the investment dollars shifting to from headcount?

Speaker #7: So I appreciate the cadence color. Just wanted to follow up on those cost impacts and how that may translate to where you can exit '26 on AOI, any important free cash flow impacts to be mindful of as well there as you go through '26 and beyond.

Speaker #7: And just also, where are the investment dollars shifting to from headcount?

Speaker #8: Hey, Brian. It's Amrita. Happy to take the question. We'll start AOI and maybe even before that, starting a gross profit and then we'll share some of the investment areas as well.

Amrita: Hey, Brian. It's Amrita. Happy to take the question. We'll start on sort of the cadence throughout the year around AOI and maybe even before that, starting at gross profit. We'll share some of the investment areas as well. Obviously, as you've heard, we've raised both our gross profit guidance from 17% growth at Investor Day for 2026 to 18% and meaningfully raised our adjusted operating income guidance. From a gross profit perspective, in terms of the pacing throughout the year, we expect a very strong Q1 with 22% gross profit growth. We've been prudent in our tax season assumptions with that. We also expect to sustain strong gross profit growth throughout the year and end the year in the mid-teens gross profit growth range in line with the longer-term Investor Day guidance we gave in the mid-teens as we look forward as well.

Amrita Ahuja: Hey, Brian. It's Amrita. Happy to take the question. We'll start on sort of the cadence throughout the year around AOI and maybe even before that, starting at gross profit. We'll share some of the investment areas as well. Obviously, as you've heard, we've raised both our gross profit guidance from 17% growth at Investor Day for 2026 to 18% and meaningfully raised our adjusted operating income guidance. From a gross profit perspective, in terms of the pacing throughout the year, we expect a very strong Q1 with 22% gross profit growth. We've been prudent in our tax season assumptions with that. We also expect to sustain strong gross profit growth throughout the year and end the year in the mid-teens gross profit growth range in line with the longer-term Investor Day guidance we gave in the mid-teens as we look forward as well.

Speaker #8: So obviously, as you've heard, we've raised both our gross profit guidance from 17% growth at investor day for '26 to 18%. And meaningfully raised our adjusted operating income guidance.

Speaker #8: From a gross profit perspective, in terms of the pacing throughout the year, we expect a very strong Q1 with 22% gross profit growth. And we've been prudent in our tax season assumptions with that.

Speaker #8: We also expect to sustain strong gross profit growth throughout the year. And end the year in the mid-teens gross profit growth range in line with the longer-term investor day guidance we gave in the mid-teens as we look forward as well.

Speaker #8: From a profitability standpoint, we expect to grow AOI nearly 30% in this first quarter and expect margins, as I noted earlier, to expand throughout the year, off of that Q1 '21% margin range.

Amrita: From a profitability standpoint, we expect to grow AOI nearly 30% in this Q1 and expect margins, as I noted earlier, to expand throughout the year off of that Q1 21% margin range. Really, the reason for that margin expansion throughout the year is a couple of things. First, look, strong underlying unit economic strengths in the business and incremental margins driving that leverage. Second, timing of some of the cost structure changes. As I noted earlier, you'd see a less meaningful impact from the cost structure changes to our Q1 results given the timing in the quarter and the notice periods for employees outside the US, as well as seeing some of that notice period dynamic flow through into Q2.

Amrita Ahuja: From a profitability standpoint, we expect to grow AOI nearly 30% in this Q1 and expect margins, as I noted earlier, to expand throughout the year off of that Q1 21% margin range. Really, the reason for that margin expansion throughout the year is a couple of things. First, look, strong underlying unit economic strengths in the business and incremental margins driving that leverage. Second, timing of some of the cost structure changes. As I noted earlier, you'd see a less meaningful impact from the cost structure changes to our Q1 results given the timing in the quarter and the notice periods for employees outside the US, as well as seeing some of that notice period dynamic flow through into Q2.

Speaker #8: Really, the reason for that margin expansion throughout the year is a couple of things. First, look, strong underlying unit economic strengths in in the business and incremental margins driving that leverage.

Speaker #8: Second, timing of some of the cost structure changes. As I noted earlier, you'd see a less meaningful impact on the cost from the cost structure changes to our Q1 results given the timing and the quarter and the notice periods for employees outside the US.

Speaker #8: As well as seeing some of that notice period dynamic flow through into Q2. Timing-related to sales and marketing spend, where we expect to see some meaningful increase in spend from Q1 to Q2.

Amrita: Timing related to sales and marketing spend, where we expect to see some meaningful increase in spend from Q1 to Q2, again, on the back of strong returns that we're seeing where that can drive long-term profitable growth. Risk-loss growth, as I noted earlier, being higher in the first half of the year on the back of really strong continued growth for borrow in the first half of this year. Ultimately, we're delivering strong AOI growth to start the year but expect that to compound throughout the year with just under 60% of the $3.2 billion in AOI we expect to come in the second half of the year. Similar trends, really, as you look across EPS as well.

Amrita Ahuja: Timing related to sales and marketing spend, where we expect to see some meaningful increase in spend from Q1 to Q2, again, on the back of strong returns that we're seeing where that can drive long-term profitable growth. Risk-loss growth, as I noted earlier, being higher in the first half of the year on the back of really strong continued growth for borrow in the first half of this year. Ultimately, we're delivering strong AOI growth to start the year but expect that to compound throughout the year with just under 60% of the $3.2 billion in AOI we expect to come in the second half of the year. Similar trends, really, as you look across EPS as well.

Speaker #8: Again, on the back of strong returns that we're seeing, where that can drive long-term profitable growth. And then risk-loss growth. As I noted earlier, being higher in the first half of the year on the back of really strong borrowed continued growth for borrow in the first half of this year.

Speaker #8: And so, ultimately, we're delivering strong AOI growth to start the year, but expect that to compound throughout the year. With just under 60% of the $3.2 billion in AOI, we expect to come in the second half of the year.

Speaker #8: And similar trends really, as you look across EPS as well. Just to then quickly on the second part of your question, in terms of where our opportunities to invest are, there really in addition to the normal course of our business across product innovation and go-to-market,

Amrita: Just to quickly on the second part of your question, in terms of where our opportunities to invest are, they're really in addition to the normal course of our business across product innovation and go-to-market, there's three things that I'd call out here. One is that we see meaningful opportunity to invest in our people, invest in hiring, invest in retaining a world-class team to deliver for our customers. Ultimately, we expect to hire some more senior AI engineering talent who will continue to level up our engineering and product capabilities. Second, as I noted, we're going to continue to invest in go-to-market to scale our customer acquisition efforts further. Third, we'll keep building on our AI infrastructure, including the tools and the capabilities ultimately that we're going to need to build a world-class organization.

Amrita Ahuja: Just to quickly on the second part of your question, in terms of where our opportunities to invest are, they're really in addition to the normal course of our business across product innovation and go-to-market, there's three things that I'd call out here. One is that we see meaningful opportunity to invest in our people, invest in hiring, invest in retaining a world-class team to deliver for our customers. Ultimately, we expect to hire some more senior AI engineering talent who will continue to level up our engineering and product capabilities. Second, as I noted, we're going to continue to invest in go-to-market to scale our customer acquisition efforts further. Third, we'll keep building on our AI infrastructure, including the tools and the capabilities ultimately that we're going to need to build a world-class organization.

Speaker #1: There's three things that I call out here One is that , you know , we see meaningful opportunity to invest in our people and invest in hiring , invest in retaining a world class team to deliver for our customers .

Speaker #1: Ultimately , we expect to hire some more senior AI engineering talent who will continue to level up our engineering and product capabilities Second , as I noted , we're going to continue to invest in go to market to scale our customer acquisition efforts further .

Speaker #1: And then third , we'll keep building on our AI infrastructure , including the tools and the capabilities ultimately , that we're going to need to build a world class organization .

Speaker #1: So those are some of the three areas of investment that I'd see playing out throughout the year , as well

Amrita: Those are some of the 3 areas of investment that I'd see playing out throughout the year as well.

Amrita Ahuja: Those are some of the 3 areas of investment that I'd see playing out throughout the year as well.

Speaker #2: Our next question comes from the line of Dan Dolev with Mizuho.

Operator: Our next question comes from the line of Dan Dolev with Mizuho.

Speaker #3: Hey guys , can you hear me

Dan Dolev: Hey, guys. Can you hear me?

Speaker #2: Yes .

Operator: Yes.

Speaker #4: Yep , yep

Darrin Peller: Yep. Yep.

Jack Dorsey: Yep. Yep.

Speaker #3: Okay . Thank you . So yeah , I just wanted to ask about your primary banking activities . I mean , this looks like a very , very strong quarter .

Dan Dolev: Okay. Thank you. Yeah, I just wanted to ask about your primary banking actives, Amrita and Jack. I mean, this looks like a very, very strong quarter, 1 million PBAs added, accelerating growth to almost 23%. These customers generate over 10 times the profit per active. This sounds very exciting. I remember you guys have talked about this as kind of the Holy Grail is adding the banking actives. I wanted to know kind of more what you're doing there and how exciting this one could be over time. Thank you.

Speaker #3: One million PBAs added, accelerating growth to almost 23%. And these customers generate over ten times the profit per. So this sounds very exciting.

Speaker #3: I remember , you know , you guys have talked about this as kind of the holy Grail is , is is is adding the banking active .

Speaker #3: So I wanted to know kind of more what you're doing there . And how exciting this one could be over time .

Speaker #4: Thank you

Speaker #5: Thanks for the question , Dan . This is Owen . I can I can take the first crack at it . As you said , we're really , really excited about where primary banking actives came in in in Q4 , as you know , we launched Cash App Green in November at Cash App releases and the whole concept around green was to expand access to the banking benefits that we offer to customers .

[Company Representative] (Block): Thanks for the question, Dan. This is Owen. I can take the first crack at it. As you said, we're really, really excited about where primary banking actives came in in Q4. As you know, we launched Cash App Green in November at Cash App Releases. The whole concept around Cash App Green was to expand access to the banking benefits that we offer to customers. We used to only offer those benefits to direct deposit actives. Now, we have a broader understanding of how customers themselves see banking primacy. If customers are spending more than $500 a month on Cash App Card, they're eligible for Cash App Green and everything that comes with it. The results following the launch of Cash App Green were fantastic. As you noted, 9.3 million primary banking actives in December, growing 22%, up about 1 million from September.

Speaker #5: We used to only offer those benefits to direct deposit actives. Now we have a broader understanding of how customers see banking primacy, and so if customers are spending more than $500 a month on Cash App Card, they're eligible for Cash App Green and everything that comes with it.

Speaker #5: The results following the launch of green were fantastic . So as you noted , 9.3 million primary banking actives in December , growing 2,022% , up about a million from September .

Speaker #5: I think over and above the the count of primary banking actives , it's actually the engagement that's most exciting . As you noted , gross profit , per active is almost ten times what we see for a peer to peer only active .

[Company Representative] (Block): I think over and above the count of primary banking actives, it's actually the engagement that's most exciting. As you noted, gross profit per active is almost 10 times what we see for a peer-to-peer-only active. We've also seen, since the launch of Green, cohort retention has improved for primary banking actives since we launched. We've seen incremental engagement across a number of different products and features on Cash App, for example, seeing incremental gross profit coming from borrow, from Cash App Card, from instant deposit. That's, as you'd expect, as the Green program is really just an incredible incentive for customers to bring more and more of their financial life to Cash App. I think one good example just showing the increase in engagement is on personalized offers. For Green customers, we're giving personalized instant discounts on Cash App Card to those customers.

Speaker #5: We've also seen, since the launch of Green Cohort, retention has improved for primary banking actives since we launched. And then we've seen incremental engagement across a number of different products and features on Cash App.

Speaker #5: For example , seeing incremental gross profit coming from borrow from Cash App Card from Instant Deposit . And that's as you'd expect , as the green program is really just an incredible incentive for customers to bring more and more of their their financial life to Cash App .

Speaker #5: I think one good example, just showing the increase in engagement, is on personalized offers. So for Green customers, we're giving personalized instant discounts on Cash App Card to those customers.

Speaker #5: Before we launched green , we saw engagement . Or like the attach rate with with offers at around 2% . And then following green , we see it at around 14% .

[Company Representative] (Block): Before we launched Cash App Green, we saw engagement or the attach rate with offers at around 2%. Following Cash App Green, we see it at around 14%. Just a massive shift in customer behavior that's coming from this program. I think ultimately, this is tied to our broader strategy around serving the modern earner. We continue to see a huge opportunity here, as we talked about at Investor Day. This is a really big, and it's a growing part of the US population. These folks are typically underserved by the legacy financial system. What we're seeing is an increase in the number of individuals who are they're earning flexibly across hourly wages, across gig work, freelance work. They're entrepreneurs. They're solopreneurs. There's no perfect financial institution out there to serve their needs.

Speaker #5: So, just a massive shift in customer behavior that's coming from this program. I think ultimately this is tied to our broader strategy around serving the modern earner.

Speaker #5: We continue to to see a huge opportunity here . As we talked about at Investor Day , this is a really big and it's a growing part of the US population .

Speaker #5: And these folks are typically underserved by the legacy financial system . And so what we're seeing is an increase in the number of individuals who are earning flexibly across hourly wages , across gig work , freelance work .

Speaker #5: They're they're entrepreneurs . They're solopreneurs . And there's no perfect financial institution out there to to serve their needs . And we think that this is a place where Cash App is leading and where Cash App will continue to lead .

[Company Representative] (Block): We think that this is a place where Cash App is leading and where Cash App will continue to lead. I think the key part here is that this was the first launch of Green. We're really just getting started. I think on the last earnings call, I talked about how we love a complex system with lots of knobs and dials that we can tune in order to reward customers and steer customer behavior. This is just the beginning of our approach for how we're going to drive more and more primary banking actives. It's a good first sign.

Speaker #5: And I think the key part here is that this was the first launch of green . So we're really just getting started , I think on the last earning earnings call , I talked about how we love a complex system with lots of knobs and dials that we can tune in order to , to reward customers and steer customer behavior .

Speaker #5: This is just the beginning of our approach for how we're going to drive more and more primary banking actives , but it's a good first sign

Speaker #2: Our next question comes from the line of Jason Kupferberg with Wells Fargo

Operator: Our next question comes from the line of Jason Kupferberg with Wells Fargo.

Speaker #6: Hey thanks , guys . Good afternoon . Really good to see that . The Q1 GTV . We accelerated 12% quarter to date despite some of the weather events out there There is an easy compare , though .

Jack: Hey, thanks, guys. Good afternoon. Really good to see that the Q1 GPV reaccelerated 12% quarter to date despite some of the weather events out there. There is an easy compare, though, in Q1. Just wanted to get your sense of visibility on the full-year guide there, which I believe is low to mid-teens. Maybe if you can just touch on the vertical trends that you've seen quarter to date, if there's been any variation in trajectory among the major verticals. Thank you.

Jason Kupferberg: Hey, thanks, guys. Good afternoon. Really good to see that the Q1 GPV reaccelerated 12% quarter to date despite some of the weather events out there. There is an easy compare, though, in Q1. Just wanted to get your sense of visibility on the full-year guide there, which I believe is low to mid-teens. Maybe if you can just touch on the vertical trends that you've seen quarter to date, if there's been any variation in trajectory among the major verticals. Thank you.

Speaker #6: In Q1 , so just wanted to get your sense of visibility on the full year guide there , which I believe is low to mid teens .

Speaker #6: And maybe if you can just touch on the vertical trends that you've seen quarter to date , if there's been any variation in trajectory among the the major verticals .

Speaker #4: Thank you

Speaker #1: Hey there . I'll kick us off on some of the latest trends . And by vertical and then I think Nik may add in on some of what we're seeing from a go to market perspective and how that inflects the curve in the future .

Amrita: Hey there. I'll kick us off on some of the latest GPV trends and by vertical. I think Nick may add in on some of what we're seeing from a go-to-market perspective and how that inflects the curve in the future. If you take a step back, Jason, as we look across all of the updates and changes we've made from a product ecosystem to a distribution channel perspective, we believe the strategy that we've got in Square is paying off. When you look at the broader years of 2024 versus 2025, we accelerated GPV growth from 8.6% to 10%. We did see, of course, as you know, a moderation in the Q4 relative to the Q3. Through Tuesday, year-to-date, we've seen GPV growth reaccelerate to over 12% and in the US as well, accelerating to over 7.5%.

Amrita Ahuja: Hey there. I'll kick us off on some of the latest GPV trends and by vertical. I think Nick may add in on some of what we're seeing from a go-to-market perspective and how that inflects the curve in the future. If you take a step back, Jason, as we look across all of the updates and changes we've made from a product ecosystem to a distribution channel perspective, we believe the strategy that we've got in Square is paying off. When you look at the broader years of 2024 versus 2025, we accelerated GPV growth from 8.6% to 10%. We did see, of course, as you know, a moderation in the Q4 relative to the Q3. Through Tuesday, year-to-date, we've seen GPV growth reaccelerate to over 12% and in the US as well, accelerating to over 7.5%.

Speaker #1: If you if you take a step back , Jason , you know , as we look across all of the updates and changes we've made from a product ecosystem to a distribution channel perspective , we believe the strategy that we've got in square is paying off .

Speaker #1: When you look at the broader years of 24 versus 25 , we accelerated GPD growth from 8.6% to 10% . We did see , of course , as you know , a moderation in the fourth quarter relative to the third quarter .

Speaker #1: Again , through Tuesday . Year to date , we've seen GTV growth accelerate to over 12% . And in the US as well , accelerating to over 7.5% .

Speaker #1: Ultimately , in the key verticals of of focus for us , we've seen really strong results . Food and beverage , GPV up 16% year over year .

Amrita: Ultimately, in the key verticals of focus for us, we've seen really strong results. Food and beverage GPV up 16% year-over-year. Mid-market sellers also exhibiting continued strong performance in Q4. We now view an opportunity to bring the playbook that we've used successfully in food and beverage over the past 12, 18 months to other verticals within the Square ecosystem to drive further strength as well. As we look back at what we can deliver in 2026, we continue to have conviction that we can accelerate GPV further in 2026 relative to 2025. Again, that's on the back of some of the really continued progress that Nick and team are making from a New Volume Added perspective with our strongest year ever in 2025. I'll turn it to you, Nick, to share more on that.

Amrita Ahuja: Ultimately, in the key verticals of focus for us, we've seen really strong results. Food and beverage GPV up 16% year-over-year. Mid-market sellers also exhibiting continued strong performance in Q4. We now view an opportunity to bring the playbook that we've used successfully in food and beverage over the past 12, 18 months to other verticals within the Square ecosystem to drive further strength as well. As we look back at what we can deliver in 2026, we continue to have conviction that we can accelerate GPV further in 2026 relative to 2025. Again, that's on the back of some of the really continued progress that Nick and team are making from a New Volume Added perspective with our strongest year ever in 2025. I'll turn it to you, Nick, to share more on that.

Speaker #1: Mid-market sellers also exhibited continued strong performance in the fourth quarter. And we now view an opportunity to bring the playbook that we've used successfully in food and beverage over the past 12 to 18 months to other verticals within the Square ecosystem to drive further strength, as well.

Speaker #1: And so as we look back at what we can deliver in 26 , we continue to have conviction that we can accelerate GPV further in 26 relative to 2025 .

Speaker #1: And again , that's on the back of some of the really continued progress that Nik and team are making from a new volume added perspective with our strongest year ever in 2025 .

Speaker #1: But I'll turn it to you , Nick , to share more on that

Speaker #7: Yeah . Thanks , Amrita . Look as MVA continues to grow and has seen acceleration in 25 , it does illustrate that it will , you know , build compounding cohort curves and only contribute more meaningfully in terms of GPV growth over the course of 2026 .

Darrin Peller: Thanks, Amrita. Look, as NVA continues to grow and has seen acceleration in 2025, it does illustrate that it will build compounding cohort curves and only contribute more meaningfully in terms of GPV growth over the course of 2026. We did a lot of great work in 2025. As Amrita mentioned, we exited 2025 with new volume added in Q4 above 29%. We saw very strong growth from a self-onboarded perspective. Still, 65% of our volume comes from our self-onboarded sellers, which is a real competitive advantage for Square. Marketing is still holding the 4 to 5-quarter payback period, which is highly efficient. We saw an even steeper acceleration from a sales perspective. Sales led NVA in Q4 was up 62%, as was referenced in the opening remarks, which significantly exceeded the 40% growth target that we spoke about late last year.

[Company Representative] (Block): Thanks, Amrita. Look, as NVA continues to grow and has seen acceleration in 2025, it does illustrate that it will build compounding cohort curves and only contribute more meaningfully in terms of GPV growth over the course of 2026. We did a lot of great work in 2025. As Amrita mentioned, we exited 2025 with new volume added in Q4 above 29%. We saw very strong growth from a self-onboarded perspective. Still, 65% of our volume comes from our self-onboarded sellers, which is a real competitive advantage for Square. Marketing is still holding the 4 to 5-quarter payback period, which is highly efficient. We saw an even steeper acceleration from a sales perspective. Sales led NVA in Q4 was up 62%, as was referenced in the opening remarks, which significantly exceeded the 40% growth target that we spoke about late last year.

Speaker #7: We did a lot of great work in 2025 . As Amrita mentioned , we exited 25 with new volume added in Q4 above 29% .

Speaker #7: We saw very strong growth from a self onboarded perspective and still 65% of our volume comes from our self onboarded sellers , which is , you know , real competitive advantage to square marketing is still holding the 4 to 5 quarter payback period , which is highly efficient .

Speaker #7: We saw an even steeper acceleration from a sales perspective . Sales led MVA in Q4 was up 62% , as was referenced in the opening remarks , which significantly exceeded the 40% growth target that we spoke about late last year .

Speaker #7: We've stayed very focused on the marginal ROI as we've scaled our field sales team and our telesales team, and our investment has been successful.

Darrin Peller: We've stayed very focused on the marginal ROI as we've scaled with our field sales team and our tele-sales team. Our investment has been successful. We had 15 US-based sales reps in Q1. We're now over 140 by year-end. We just did our first deal in Australia and the UK through our field team. Seeing that continue to expand. Over 50% of our inbound leads for our field team is through our partnerships channel in Q4. Particularly with Sysco, where we're seeing 80% growth in referrals quarter-over-quarter, we've really lifted our strategic relationship with them and seeing strong progress. If I just look forward to 2026, our existing reps will continue to scale just given time and seat. Many of them were ramping during the course of 2025. We scaled our independent sales organization partners to over 100.

[Company Representative] (Block): We've stayed very focused on the marginal ROI as we've scaled with our field sales team and our tele-sales team. Our investment has been successful. We had 15 US-based sales reps in Q1. We're now over 140 by year-end. We just did our first deal in Australia and the UK through our field team. Seeing that continue to expand. Over 50% of our inbound leads for our field team is through our partnerships channel in Q4. Particularly with Sysco, where we're seeing 80% growth in referrals quarter-over-quarter, we've really lifted our strategic relationship with them and seeing strong progress. If I just look forward to 2026, our existing reps will continue to scale just given time and seat. Many of them were ramping during the course of 2025. We scaled our independent sales organization partners to over 100.

Speaker #7: We had 15 US based sales reps in Q1 . We're now over 140 by year end , and we just did our first deal in Australia and the UK through our field team .

Speaker #7: So seeing that continue to expand , over 50% of our inbound leads for our field team is through our partnerships channel . In Q4 and particularly with Sysco , where we're seeing 80% growth in referrals quarter over quarter .

Speaker #7: We're really , you know , lifted our strategic relationship with them and seeing strong progress And if I just look forward to 2026 , our existing reps will continue to scale .

Speaker #7: Just given time and seat . And many of them were ramping during the course of 2025 . We scaled our independent sales organization partners to over 100 .

Speaker #7: We have a great team leading that and it's complementing our direct sales motion and scaling across multiple geographies . And then , as Owen mentioned , we're really seeing a lift in product velocity and quickly closing the gap from a competitor product set perspective .

Darrin Peller: We have a great team leading that. It's complementing our direct-to-sales motion and scaling across multiple geographies. Then, as Owen mentioned, we're really seeing a lift in product velocity and quickly closing the gap from a competitor product set perspective. 2025 was our strongest year ever in NVA, fueled by a transformed go-to-market motion across marketing, sales, partnerships. I really expect that to continue to compound into 2026.

[Company Representative] (Block): We have a great team leading that. It's complementing our direct-to-sales motion and scaling across multiple geographies. Then, as Owen mentioned, we're really seeing a lift in product velocity and quickly closing the gap from a competitor product set perspective. 2025 was our strongest year ever in NVA, fueled by a transformed go-to-market motion across marketing, sales, partnerships. I really expect that to continue to compound into 2026.

Speaker #7: So , you know , 2025 was our strongest year ever in NVA . You know , fueled by a transformed market motion across marketing , sales , partnerships .

Speaker #7: And I really expect that to continue to compound into 2026.

Speaker #2: Our next question comes from the line of Will Nance with Goldman Sachs .

Operator: Our next question comes from the line of Will Nance with Goldman Sachs.

Speaker #8: Hey guys . Thank you for taking the question . I was wondering if you could talk on MOU growth . I think it came in a little bit stronger than what the street was looking for .

[Company Representative] (Block): Hey, guys. Thank you for taking the question. I was wondering if you could talk on MAU growth. I think it came in a little bit stronger than what the street was looking for, I think more or less in line with what you talked about on the Investor Day. Could you just remind us about how you're thinking about the growth algorithm in Cash App from an MAU perspective? Thank you. Sure. Thanks. I mean, we're really happy with the growth in actives in the second half of last year and in particular in Q4 in December. As you said, we hit 59 million monthly active accounts in December. That was up from 58 million in September. This was driven by a few different things, efforts across multiplayer money, network enhancements, our go-to-market motion, then also just our focus on teens and the next generation.

Will Nance: Hey, guys. Thank you for taking the question. I was wondering if you could talk on MAU growth. I think it came in a little bit stronger than what the street was looking for, I think more or less in line with what you talked about on the Investor Day. Could you just remind us about how you're thinking about the growth algorithm in Cash App from an MAU perspective? Thank you.

Speaker #8: I think more or less in line with what you talked about on the Investor Day . So could you just remind us about how you're thinking about the growth algorithm in Cash App from from an MoU perspective ?

Speaker #8: Thank you

[Company Representative] (Block): Sure. Thanks. I mean, we're really happy with the growth in actives in the second half of last year and in particular in Q4 in December. As you said, we hit 59 million monthly active accounts in December. That was up from 58 million in September. This was driven by a few different things, efforts across multiplayer money, network enhancements, our go-to-market motion, then also just our focus on teens and the next generation.

Speaker #5: Sure . Thanks . I mean , we're really happy with the growth in actives and the second half of last year . And in particular in Q4 and December , as you said , we we hit 59 million monthly active accounts in December .

Speaker #5: That was up from 58 million in September . This was driven by a few different things . Efforts across multiplayer , money , network enhancements , our go to market motion , and then also just our focus on on teens in the next generation .

Speaker #5: So on the multiplayer money side , we had some key launches . We rolled out peer to peer on web . We're in the process of rolling out our new core payment flow and that critically , that's connected to Money Bot .

[Company Representative] (Block): On the multiplayer money side, we had some key launches. We rolled out peer-to-peer on web. We're in the process of rolling out our new core payment flow. Critically, that's connected to Moneybot. It also is the flow that is built to support stablecoins, continuing to tweak things there and get that rolled out to 100%. We also launched payment links, which just makes it easy to get paid into Cash App. You can send those links through text or DM or what have you. We continue the evergreen work on the network enhancement side, just making sure that we're reducing friction where we can and making Cash App easy and simple to use. Teens and families, we've continued to invest in as well.

Speaker #5: And then it also is the flow that is built to to support stablecoins . So continuing to to tweak things there and get that rolled out to 100% .

Speaker #5: We also launched payment links , which just makes it easy to get paid into Cash App . And you can send those links through text or DM or what have you .

Speaker #5: We continue the evergreen work on the network enhancement side , just making sure that we're reducing friction where we can and making Cash App easy and simple to use .

Speaker #5: Teens and families—we've continued to invest in as well. And then right now we're working on expanding access to Cash App cards and savings accounts for children who are 6 to 12 years old right now.

[Company Representative] (Block): Right now, we're working on expanding access to Cash App Cards and savings accounts for children who are 6 to 12 years old. Right now, the teens program is for those 13 to 17 years old. We've seen strength where we can kind of grow with those individuals. We expect it to be the same for children who are 6 to 12. Marketing is obviously always on full funnel across all of the channels, how we think about incentives, how we think about rewards. I think critically, it's not just about the actives number itself. It's also about the quality of actives. What we're seeing is higher engagement rates and higher attach rates for new actives. For instance, in December, 21% of new actives attached to a banking product. That was up pretty meaningfully versus December of the previous year.

Speaker #5: The teens program is for those 13 to 17 years old , and we've seen strength where we can kind of grow with those individuals and we expect it to be the same for for children who are 6 to 12 .

Speaker #5: And then marketing is obviously always on full funnel across all the channels. How we think about incentives, how we think about rewards.

Speaker #5: I think critically it's not just about the actives number itself . It's also about the quality of actives . So what we're seeing is higher engagement rates and higher attach rates for new actives .

Speaker #5: For instance , in December , 21% of new actives attached to a banking product and that was up pretty meaningfully versus December of the of the previous year .

Speaker #5: So all in all , we feel good about the growth algorithm . There's a there's a number of things that are contributing to actives growth .

[Company Representative] (Block): All in all, we feel good about the growth algorithm. There's a number of things that are contributing to actives growth. We feel confident in that low single-digit year-over-year growth number that we've given. There might be some wiggles month to month or quarter to quarter. We're feeling really good about where we are. Of course, we're trying to do everything that we can to surpass those expectations. Thanks.

Speaker #5: We feel confident in that low single digit year over year growth number that we've given . There might be some wiggles month to month or quarter to quarter , but we're feeling really good about where we are .

Speaker #5: And of course, we're trying to do everything that we can to surpass those expectations.

Speaker #4: Thanks

Speaker #2: Our next question comes from the line of Tim Chiodo with UBS.

Operator: Our next question comes from the line of Tim Chiodo with UBS.

Speaker #9: Great . Thank you . Let's shift gears a little bit . I want to talk about a new revenue stream . So Cash App Score recently was made available effectively as a service to other third party lenders .

[Company Representative] (Block): Great. Thank you. Let's shift gears a little bit. I want to talk about a new revenue stream. Cash App Score recently was made available effectively as a service to other third-party lenders. You mentioned that this is early, but you're already having some good conversations with some third-party lenders. My understanding is they would effectively be buyers of this service and incorporating it into their own underwriting flows as maybe a part of a more holistic approach to underwriting. The main point is I was hoping you could talk a little bit about the revenue opportunity and the pricing model. Hey, Tim. Thanks for the question. I'll just set the stage a little bit before I get into the details. I think what we're seeing in the US is a lot of consumers moving away from credit cards and moving toward other forms of payment.

Timothy Chiodo: Great. Thank you. Let's shift gears a little bit. I want to talk about a new revenue stream. Cash App Score recently was made available effectively as a service to other third-party lenders. You mentioned that this is early, but you're already having some good conversations with some third-party lenders. My understanding is they would effectively be buyers of this service and incorporating it into their own underwriting flows as maybe a part of a more holistic approach to underwriting. The main point is I was hoping you could talk a little bit about the revenue opportunity and the pricing model.

Speaker #9: You mentioned that this is early , but you're already having some good conversations with some third party lenders . My understanding is they would effectively be buyers of this service and incorporating it into their own underwriting flows as maybe a part of a more holistic approach to underwriting .

Speaker #9: But the main point is, I was hoping you could talk a little bit about the revenue opportunity and the pricing model.

[Company Representative] (Block): Hey, Tim. Thanks for the question. I'll just set the stage a little bit before I get into the details. I think what we're seeing in the US is a lot of consumers moving away from credit cards and moving toward other forms of payment.

Speaker #5: Hey , Tim , thanks . Thanks for the question . I'll just set the stage a little bit before I get into the details .

Speaker #5: I think what we're seeing in the in the US is a lot of consumers moving away from credit cards and moving toward other forms of payment , and that's especially true for younger individuals .

[Company Representative] (Block): That's especially true for younger individuals. A byproduct of this is that a decent share of the population is now basically anonymous to the legacy credit bureaus. As time goes on, those folks are contributing more and more to the US economy. This is kind of the bet on the next generation and the modern earner that we've been talking about. Right now, to some extent, they're getting left out of the traditional credit model. On the flip side, meanwhile, we lent out $18.5 billion to consumers in Q4. That number was up almost 70% year-over-year. We did that profitably. We were able to do that largely because of the unique data that we have on our customers that we use to generate a unique Cash App Credit Score for each of our customers.

Speaker #5: And so a byproduct of this is that a decent share of the population is now basically anonymous to the credit bureaus . But as time goes on , those folks are contributing more and more to the US economy .

Speaker #5: And this is kind of the bet on the next generation and the modern earner that we've been that we've been talking about . But right now , to some extent , they're getting left out of the traditional credit model .

Speaker #5: On the flip side , meanwhile , you know , we lent out $18.5 billion to consumers in Q4 , and that number was up almost 70% year over did that profitably , and we were able to do that largely because of the unique data that we have on our customers that we use to to generate a unique Cash App credit score for each of our customers .

Speaker #5: So then now we're thinking through how do we leverage this credit score? I think the first step is that we're going to show the Cash App credit score to our customers.

[Company Representative] (Block): Now we're thinking through how do we leverage this credit score? I think the first step is that we're going to show the Cash App Credit Score to our customers. I think there's a couple of benefits there. First is just giving transparency and building trust with our customers. We also think this could be a meaningful driver of behavior, just incenting customers to engage more with Cash App in order to drive their credit score. I think second, to your point, we do intend to partner with certain third parties or allow third parties to buy credit score data from us. Since Investor Day, and we have a website out now as well, we've seen really strong demand from a number of different folks. We've had a number of conversations. It's clear that there's a tremendous amount of demand out there.

Speaker #5: I think there are a couple of benefits there. First is just building transparency, or, you know, giving transparency and building trust with our customers.

Speaker #5: We also think this could be a meaningful driver of behavior . Just incenting customers to engage more with Cash App in order to to drive their their credit score .

Speaker #5: I think second to your point , we do intend to partner with certain third parties or allow third parties to buy credit score data from US .

Speaker #5: Since Investor Day , and we have a website out now as well . We've seen really , really strong demand from a number of of different folks , and we've had a number of conversations .

Speaker #5: So it's clear that there's a tremendous amount of demand out there . Also , just given the criticality of this for us going forward , we want to be super deliberate in terms of how we design that program and where we choose to monetize , and the sorts of folks that we choose to to partner with .

[Company Representative] (Block): Just given the criticality of this for us going forward, we want to be super deliberate in terms of how we design that program and where we choose to monetize and the sorts of folks that we choose to partner with. There's subsequent things that you could imagine where it's not just a data mechanism taking place, but also there's actually UI within Cash App where we're able to connect customers with certain credit offerings where maybe we don't power those things right now, but we can increase access and we can bring down costs because of the unique data that we have. At this point, I would say where we are is it's always been clear to us internally that the credit score is extremely valuable. That's how we underwrite such a large book and do it so profitably.

Speaker #5: And then , you know , there's subsequent things that you could imagine where it's not just data mechanism taking place , but but also there's actually UI within Cash App where we're able to connect customers with , with , with certain credit offerings , where maybe we don't power those things right now , but we can , you know , we can increase access and we can bring down costs because of the unique data that we that we have .

Speaker #5: So at this point, I would say where we are is it's always been clear to us internally that the credit score is extremely valuable.

Speaker #5: That's how we we underwrite such a , such a large book and do it so profitably . Now , I think it's it's increasingly clear that it's valuable for consumers and it's and it's and it's seen as really valuable for other lenders .

[Company Representative] (Block): Now, I think it's increasingly clear that it's valuable for consumers. It's seen as really valuable for other lenders. I think probably the most interesting thing that I would say here, and I'll end with this, is that I think this is just further indicative of how critical Borrow and our lending products are to the Cash App ecosystem overall. I think we have an opportunity here to build a very high-margin product, a very high-margin gross profit stream. That could only really exist because of Borrow and Cash App Afterpay and our other lending products. It's just part of the overall ecosystem on the Cash App side and how we're trying to increase access.

Speaker #5: I think probably the most interesting thing that I would say here, and I'll end with this, is that I think this is just further indicative of how critical Borrow and our lending products are to the Cash App ecosystem.

Speaker #5: Overall , I think we have an opportunity here to build a very high margin product , a very high margin gross profit stream , but that could only really exist because of borrow and Cash app .

Speaker #5: Afterpay and our other lending products . And so it's just part of the the overall ecosystem on the Cash App side and how we're trying to increase access

Speaker #2: Our next question comes from the line of Andrew Schmidt with KeyBanc.

Operator: Our next question comes from the line of Andrew Schmidt with KeyBanc Capital Markets.

Speaker #10: Hi , Jack . Hi , Amrita . Thanks for taking the question . I appreciate the moves today . It's good to ask on BNPL , a number of good comments there .

Andrew Schmidt: Hi, Jack. Hi, Amrita. Thank you for taking the question. I appreciate the moves today. I forgot to ask on BNPL. A number of good comments there, momentum in Afterpay post-purchase, the new products rolling out in 2026. Just curious as a starting point how Q4 came in versus expectations, and then how we should think about growth into 2026 across Core Afterpay, post-purchase, and then some of the newer products you're rolling out. Thanks so much.

Speaker #10: Momentum and Afterpay post-purchase . The new product rolling out in 2026 . Just curious as starting point how fork came in versus expectations .

Speaker #10: And then how we should think about growth into 2026 across Afterpay post-purchase and then some of the new , newer products you're rolling out .

Speaker #10: Thanks so much .

Speaker #4: Thanks for the question .

Darrin Peller: Thanks for the question. I'm happy to take this question. Firstly, when I think about Buy Now Pay Later, I think about it more from the lens of our kind of commerce consortium. I think that more appropriately represents what's going on in the market. It's no longer just about paying for. It's about pay now, paying for through our integrated merchant relationships, Afterpay on the Cash App card, paying monthly. I think this is kind of the apples-to-apples view. That's how we look at it internally. As we've been kind of executing over the last period, we've been very focused on disciplined, profitable growth for both Afterpay and Cash App. We've yet to focus for GPV, and commerce volume was up 17%.

Jack Dorsey: Thanks for the question. I'm happy to take this question. Firstly, when I think about Buy Now Pay Later, I think about it more from the lens of our kind of commerce consortium. I think that more appropriately represents what's going on in the market. It's no longer just about paying for. It's about pay now, paying for through our integrated merchant relationships, Afterpay on the Cash App card, paying monthly. I think this is kind of the apples-to-apples view. That's how we look at it internally. As we've been kind of executing over the last period, we've been very focused on disciplined, profitable growth for both Afterpay and Cash App. We've yet to focus for GPV, and commerce volume was up 17%.

Speaker #7: You know , I'm happy to take take this question . So firstly , when I think about buy now , pay later , I think about it more from the lens of our kind of commerce consortium .

Speaker #7: And I think that more appropriately represents what's going on in the market. It's no longer just about paying for, you know, it's about pay.

Speaker #7: Now , paying for through our integrated merchant relationships . After paying the Cash App card pay monthly , I think this is , you know , kind of the apples to apples view .

Speaker #7: And that's how we look at it internally as we've been kind of executing over the last period . We've been very focused on disciplined , profitable growth for both Afterpay and Cash App .

Speaker #7: With the focus for GBV and commerce . Volume was up 17% and consumer lending originations . As Owen mentioned , up 69% year over year .

Darrin Peller: Consumer lending originations, as Owen mentions, up 69% year-over-year, but really focused as well on being conscious from a risk loss perspective and scaling in the right way. For Afterpay specifically, we added large partners like Fanatics and Endeavour Group, which is the largest liquor retailer in Australia. Post-purchase, Buy Now Pay Later has continued to gain traction and is one of the fastest-growing products, which is primarily net new customers to Afterpay. As Owen also mentioned, we're in the early days of rolling out pre-purchase Afterpay on the Cash App card, which we started in February, enabling payment financing for eligible actives. I'm happy about what we're seeing from a Buy Now Pay Later perspective. Cash App Pay as well, I know you didn't mention it, but it's important as part of this kind of commerce stack.

Jack Dorsey: Consumer lending originations, as Owen mentions, up 69% year-over-year, but really focused as well on being conscious from a risk loss perspective and scaling in the right way. For Afterpay specifically, we added large partners like Fanatics and Endeavour Group, which is the largest liquor retailer in Australia. Post-purchase, Buy Now Pay Later has continued to gain traction and is one of the fastest-growing products, which is primarily net new customers to Afterpay. As Owen also mentioned, we're in the early days of rolling out pre-purchase Afterpay on the Cash App card, which we started in February, enabling payment financing for eligible actives. I'm happy about what we're seeing from a Buy Now Pay Later perspective. Cash App Pay as well, I know you didn't mention it, but it's important as part of this kind of commerce stack.

Speaker #7: But really focused as well on on being , you know , conscious from a risk loss perspective and scaling in the right way .

Speaker #7: For Afterpay , specifically , we added large partners like fanatics and Endeavor Group , which is the largest liquor retailer in Australia . Post-purchase buy now , pay later has continued to gain traction and is one of the fastest growing products .

Speaker #7: You know , with with primarily net new customers to our Afterpay . And then , as Owen also mentioned , we're in the early days of rolling out pre-purchase after on the Cash App card , which we started in February , enabling , you know , the financing for eligible actives .

Speaker #7: And so , you know , I'm happy about what we're seeing from a buy now , pay later perspective . Cash app pay as well .

Speaker #7: I know you didn't mention it, but it's important as part of this kind of commerce stack. It's continued to scale at a very meaningful pace.

Darrin Peller: It's continued to scale at a very meaningful pace, up 55% year-over-year and active surpassing 8 million in the Q4. When I look at these merchant partnerships where we're seeing strong product-market fit, new distribution opportunities like Instacart and Target, it provides a unique and simple on-ramp for Afterpay down the track, given we designed this from a single integration, single contract, single settlement perspective. To your question and point on 2026, I still believe there's a very large and growing TAM, and we're very well positioned to capture it. 90 million Americans are expected to use Buy Now Pay Later in 2026 and volume doubling by 2031. Given Cash App's scaled customer base and particularly the scale of the Cash App Card, it's differentiated, owned by us.

Jack Dorsey: It's continued to scale at a very meaningful pace, up 55% year-over-year and active surpassing 8 million in the Q4. When I look at these merchant partnerships where we're seeing strong product-market fit, new distribution opportunities like Instacart and Target, it provides a unique and simple on-ramp for Afterpay down the track, given we designed this from a single integration, single contract, single settlement perspective. To your question and point on 2026, I still believe there's a very large and growing TAM, and we're very well positioned to capture it. 90 million Americans are expected to use Buy Now Pay Later in 2026 and volume doubling by 2031. Given Cash App's scaled customer base and particularly the scale of the Cash App Card, it's differentiated, owned by us.

Speaker #7: Up 55% year on year . And active , surpassing 8 million in the fourth quarter . And when I look at these merchant partnerships , where we're seeing strong product market fit , you know , new distribution opportunities like Instacart and Target , it provides a unique and simple on ramp for Afterpay .

Speaker #7: You know , in in down the track , given we design this from a single integration single contract , single settlement perspective and then to your question and point , on 2026 , I still believe there's a very large and growing Tam , and we're very well positioned to capture it .

Speaker #7: You know , 90 million Americans are expected to use buy now , pay later in in 2026 . And volume double doubling by 2031 .

Speaker #7: And giving Cash App's you know , scaled customer base and particularly the scale of the Cash App card . It's differentiated owned by us .

Speaker #7: And I'm really excited to see that continue to to continue to taking that to market . So , yeah , looking forward to the to the rest of 2026 and focusing on our broader commerce performance

Darrin Peller: I'm really excited to see that continue to for us to continue taking that to market. Yeah, looking forward to the rest of 2026 and focusing on our broader commerce performance.

Jack Dorsey: I'm really excited to see that continue to for us to continue taking that to market. Yeah, looking forward to the rest of 2026 and focusing on our broader commerce performance.

Speaker #2: Our next question comes from the line of Rayna Kumar with

Operator: Our next question comes from the line of Rayna Kumar with Oppenheimer.

Speaker #11: Hi , Jack , and thanks for taking my question . Just want to go back to Cash App Borrow for a second . Can you talk specifically about your expectations for Cash App Borrow growth in 26 and separately .

Bryan Bergin: Hi, Jack, and Amrita. Thanks for taking my question. Just want to go back to Cash App Borrow for a second. Can you talk specifically about your expectations for Cash App Borrow growth in 2026? Separately, how have loss rates trended in Borrow and with BNPL? Thank you.

Speaker #11: How have loss rates trended in and with BNPL? Thank you.

Speaker #1: Hey Raina , it's Amrita . I'm happy to I'm happy to . There's a little bit of feedback okay ? I think that's better .

Amrita: Hey, Reena. It's Amrita. Happy to take this one.

Amrita Ahuja: Hey, Reena. It's Amrita. Happy to take this one.

Bryan Bergin: Hey, Reena. Happy to take this.

Amrita: There's a little bit of feedback. Okay, I think that's better. Yeah, Borrow had an incredible quarter, as you saw. We continue to be excited about the growth path for 2026 with Borrow. As I noted on the call, we expect to see even stronger growth in the first half of the year relative to the second half. You'd see that flow through. What we've seen so far is that variable profit margins continue to be strong. Even the Q4 with the pretty astounding 223% year-over-year origination volume growth, 50% quarter-over-quarter growth, even with that, we saw variable profit margins in line with our targets across both new and mature cohorts despite that triple-digit origination growth. Really, as we think about what's driving that Borrow growth, I think we'll continue to drive growth as we head into 2026. There's really two big drivers.

Amrita Ahuja: There's a little bit of feedback. Okay, I think that's better. Yeah, Borrow had an incredible quarter, as you saw. We continue to be excited about the growth path for 2026 with Borrow. As I noted on the call, we expect to see even stronger growth in the first half of the year relative to the second half. You'd see that flow through. What we've seen so far is that variable profit margins continue to be strong. Even the Q4 with the pretty astounding 223% year-over-year origination volume growth, 50% quarter-over-quarter growth, even with that, we saw variable profit margins in line with our targets across both new and mature cohorts despite that triple-digit origination growth. Really, as we think about what's driving that Borrow growth, I think we'll continue to drive growth as we head into 2026. There's really two big drivers.

Speaker #1: Yeah . Borrow had an incredible quarter as you saw . And we continue to be excited about the growth path for 2026 with borrow .

Speaker #1: As I noted on the call, you know we expect to see even stronger growth in the first half of the year, relative to the second half.

Speaker #1: And you'd see that flow through what we've seen so far is that variable profit margins continue to be strong , and even the fourth quarter with , you know , the pretty astounding 223% year over year origination volume growth , 50% , quarter over quarter growth , even with that , we saw variable profit margins in line with our targets across both new and mature cohorts .

Speaker #1: Despite that triple-digit origination growth, really, as we think about what's driving that borrow growth, I think it will continue to drive growth as we head into '26.

Speaker #1: And there's really two , two big drivers . One is , as you know , we've transitioned borrow loan origination to SFS and SFS is now fully this is our Bank Square Financial Services .

Amrita: One is, as you know, we've transitioned Borrow loan origination to SFS. SFS is now fully this is our bank, Square Financial Services. SFS is now fully originating all Borrow loans. With that, we have both improved unit economics on Borrow loans and new states that we can expand into. That expansion is underway, but we see an opportunity to go much further there. That is a big driver, that expansion across new states. The improved unit economics is a big driver of the growth that you've seen in Q4 and we'd expect to see in 2026. The second big thing is the deep integration of Borrow into this broader Cash App ecosystem and in particular with our program around Cash App Green. In Q4, we leaned into those Borrow loans. We know that they're so attractive to the modern earner.

Amrita Ahuja: One is, as you know, we've transitioned Borrow loan origination to SFS. SFS is now fully this is our bank, Square Financial Services. SFS is now fully originating all Borrow loans. With that, we have both improved unit economics on Borrow loans and new states that we can expand into. That expansion is underway, but we see an opportunity to go much further there. That is a big driver, that expansion across new states. The improved unit economics is a big driver of the growth that you've seen in Q4 and we'd expect to see in 2026. The second big thing is the deep integration of Borrow into this broader Cash App ecosystem and in particular with our program around Cash App Green. In Q4, we leaned into those Borrow loans. We know that they're so attractive to the modern earner.

Speaker #1: SFS is now fully originating . All borrow loans . And with that we have both improved unit economics on borrow loans and new states that we can expand into , and that expansion expansion is underway .

Speaker #1: But we see an opportunity to go to go much further . There . And so that is a big driver . That expansion across new states and the improved unit economics is a big driver of the growth that you've seen in Q4 .

Speaker #1: And we'd expect to see in 26 . The second big thing is the deep integration of borrow into this broader Cash App ecosystem .

Speaker #1: And in particular with our program around Cash App , green . In the fourth quarter , we leaned into those borrow loans . We know that they're so attractive to the modern earner , and we saw a lot of success where customers were excited to either get their first borrow loan or get a higher limit as they became a Cash App .

Amrita: We saw a lot of success where customers were excited to either get their first Borrow loan or get a higher limit as they became a Cash App Green customer. When we think if you step back again and think about Borrow, it is an important element for the modern earner in how they can address the variability in their income. Many customers have cited to us, they seek flexibility. Borrow provides that for them as they think about those periods in between paychecks. That's really a primary driver here for why they would take out a Borrow loan and why we've seen such astounding product-market fit across our customer base here.

Amrita Ahuja: We saw a lot of success where customers were excited to either get their first Borrow loan or get a higher limit as they became a Cash App Green customer. When we think if you step back again and think about Borrow, it is an important element for the modern earner in how they can address the variability in their income. Many customers have cited to us, they seek flexibility. Borrow provides that for them as they think about those periods in between paychecks. That's really a primary driver here for why they would take out a Borrow loan and why we've seen such astounding product-market fit across our customer base here.

Speaker #1: Green customer . You know , when we think if you step back again and think about borrow , it is an important element for the modern earner in how they can address the variability in their income .

Speaker #1: These many customers have cited to us , they seek flexibility and borrow , provides that for them as they think about those periods .

Speaker #1: In between paychecks and and that's really a primary driver here for , for for why they would take out a bar loan and why we've seen such astounding product market fit across our customer base here .

Speaker #1: And again , expanding borrow , you rapidly . But still doing that responsibly given the product design attributes . And given the very , very strong underwriting models that we've built through our 15 years of of understanding , lending and and really strong growth across each of the two businesses from a lending perspective .

Amrita: Again, expanding Borrow rapidly but still doing that responsibly given the product design attributes and given the very, very strong underwriting models that we've built through our 15 years of understanding lending and really strong growth across each of the two businesses from a lending perspective. That's really what's driven Borrow as we think about this past year and why we continue to expect strong momentum for Borrow into 2026.

Amrita Ahuja: Again, expanding Borrow rapidly but still doing that responsibly given the product design attributes and given the very, very strong underwriting models that we've built through our 15 years of understanding lending and really strong growth across each of the two businesses from a lending perspective. That's really what's driven Borrow as we think about this past year and why we continue to expect strong momentum for Borrow into 2026.

Speaker #1: So that's really what's driven Borrow as we think about this past year, and why we continue to expect strong momentum for Borrow into '26.

Speaker #2: Our next question comes from the line of Ramsey El-assal with Cantor Fitzgerald .

Operator: Our next question comes from the line of Ramsey El-Assal with Cantor Fitzgerald.

Speaker #12: Hi. Can you guys hear me?

Dan Dolev: Hi. Can you guys hear me?

Ramsey El-Assal: Hi. Can you guys hear me?

Speaker #2: Yes .

Amrita: Yes.

Jack Dorsey: Yes.

Speaker #12: Fantastic . Thank you for squeezing me in . So AI , you guys have woven AI into obviously a lot of the conversations having a transformative impact across your business .

Dan Dolev: Fantastic. Thank you for squeezing me in. You guys have woven AI into, obviously, a lot of the conversations, having a transformative impact across your business. I have a two-parter. I guess first, do you see AI as a new competitive vector where Block has an opportunity, maybe a rare opportunity, to sort of leapfrog competitors or redefine the competitive landscape? I guess second, what gives you guys the right to win here? What are Block's competitive advantages in AI?

Ramsey El-Assal: Fantastic. Thank you for squeezing me in. You guys have woven AI into, obviously, a lot of the conversations, having a transformative impact across your business. I have a two-parter. I guess first, do you see AI as a new competitive vector where Block has an opportunity, maybe a rare opportunity, to sort of leapfrog competitors or redefine the competitive landscape? I guess second, what gives you guys the right to win here? What are Block's competitive advantages in AI?

Speaker #12: So I have a two parter , I guess . First , do you see AI as a new competitive vector where block has an opportunity , maybe a rare opportunity to sort of leapfrog competitors or redefine the competitive landscape and I guess second , what gives you guys the right to win here ?

Speaker #12: What are blocks competitive advantages in AI ?

Speaker #4: Yeah , I do . So I think it goes back to those four things that we we want to focus on right now in terms of what we build as a company .

Jack: Yeah, I do. I think it goes back to those four things that we want to focus on right now in terms of what we build as a company. The first that sets us apart is all of our capabilities that we've built up over time. That's everything from our network and peer-to-peer. It's the fact that we can issue cards, that we can accept cards, that we can lend money to sellers and individuals. These are very, very hard to acquire as capabilities, and they're hard to maintain. These are things that represent exact use cases that customers are coming to us in the first place for. When you pair that with the interface, we have a massive install interface on the Square side with our merchants. We have the same on the Cash App side through an app and the website.

Jack Dorsey: Yeah, I do. I think it goes back to those four things that we want to focus on right now in terms of what we build as a company. The first that sets us apart is all of our capabilities that we've built up over time. That's everything from our network and peer-to-peer. It's the fact that we can issue cards, that we can accept cards, that we can lend money to sellers and individuals. These are very, very hard to acquire as capabilities, and they're hard to maintain. These are things that represent exact use cases that customers are coming to us in the first place for. When you pair that with the interface, we have a massive install interface on the Square side with our merchants. We have the same on the Cash App side through an app and the website.

Speaker #4: The first that sets us apart is all of our capabilities that we've built up over time . That's everything from our network and peer to peer .

Speaker #4: It's the fact that we can issue cards that we can accept , cards that we can lend money to sellers and individuals . These are very , very hard to acquire as capabilities .

Speaker #4: And they're they're hard to maintain . And these are things that represent exact use cases that that customers are coming to us in the first place .

Speaker #4: For when you pair that with the interface , we have a massive install interface on the square side with with our merchants . We have the same on the Cash App side through an app and the website .

Speaker #4: What we'll be able to do is compose these capabilities fluidly to deliver them to all of our customers in real time , in a much more personalized way , in a way that they're going to feel like they can actually build their features and their functionality themselves .

Jack: What we'll be able to do is compose these capabilities fluidly to deliver them to all of our customers in real time in a much more personalized way, in a way that they're going to feel like they can actually build their features and their functionality themselves. I think that's a significant advantage. I think the biggest advantage, though, is our understanding of our customers. We have an understanding of both sides of the counter. We have real-time data, which is very real transactional data. We can connect it from the merchant to the consumer. We can actually use that understanding to be a lot more proactive. Instead of our customers coming to our intelligent systems and knowing what question to ask and what to prompt the AI, we can actually prompt our customers.

Jack Dorsey: What we'll be able to do is compose these capabilities fluidly to deliver them to all of our customers in real time in a much more personalized way, in a way that they're going to feel like they can actually build their features and their functionality themselves. I think that's a significant advantage. I think the biggest advantage, though, is our understanding of our customers. We have an understanding of both sides of the counter. We have real-time data, which is very real transactional data. We can connect it from the merchant to the consumer. We can actually use that understanding to be a lot more proactive. Instead of our customers coming to our intelligent systems and knowing what question to ask and what to prompt the AI, we can actually prompt our customers.

Speaker #4: I think that's a significant advantage . I think the biggest advantage , though , is our understanding of our customers . We have an understanding of both sides of the counter .

Speaker #4: We have real time data , which is very real transactional data , and we can connect it from the merchant to the consumer , and we can actually use that understanding to be a lot more proactive instead of our customers coming to our intelligence systems and knowing what question to ask and what to prompt the AI , we can actually prompt our customers and we can do it in the right time so that they can have an experience where they have an intelligent system that is looking to protect their business and to protect their individual finances and help them along whatever goals they might have .

Jack: We can do it in the right time so that they can have an experience where they have an intelligent system that is looking to protect their business and to protect their individual finances and help them along whatever goals they might have. These are out today and something that we're going to continue to build on. Finally is making sure that we're using this intelligence and we're building these world models to help us orchestrate the company much better and be a whole lot more efficient about how we work, how we deliver, and how we ship. I know all four of those together really set us apart.

Jack Dorsey: We can do it in the right time so that they can have an experience where they have an intelligent system that is looking to protect their business and to protect their individual finances and help them along whatever goals they might have. These are out today and something that we're going to continue to build on. Finally is making sure that we're using this intelligence and we're building these world models to help us orchestrate the company much better and be a whole lot more efficient about how we work, how we deliver, and how we ship. I know all four of those together really set us apart.

Speaker #4: And these are out today and something that we're going to continue to build on . And then finally is making sure that we're using this intelligence and we're building these world models to help us orchestrate the company much better and be a whole lot more efficient about how we work and how we deliver and how we ship .

Speaker #4: So I think all four of those together , I know all four of those together , really set us apart . And a big part of the move we made , we made today was to get us in position to do just that and to to be ahead of our customers expectations and to be ahead of the curve and actually being able to deliver that new , that new functionality

Jack: A big part of the move we made today was to get us in position to do just that and to be ahead of our customers' expectations and to be ahead of the curve in actually being able to deliver that new functionality.

Jack Dorsey: A big part of the move we made today was to get us in position to do just that and to be ahead of our customers' expectations and to be ahead of the curve in actually being able to deliver that new functionality.

Speaker #2: We will now take our last question from Brian Keene with Citi.

Operator: We will now take our last question from Bryan Keane with Citi.

Speaker #13: Hi guys . Thanks for squeezing me in , Amrita . You know , the the guidance for 26 today is above what was outlined at the Analyst Day .

Bryan Keane: Hi, guys. Thanks for squeezing me in. Amrita, the guidance for 2026 today is above what was outlined at the Investor Day. What does that mean for the 2028 targets of $15.5 billion in gross profit and adjusted EPS of $5.50? I think it was $4 billion in free cash flow. What's the bridge that you need now to get there, or are those targets a little bit different? Thank you.

Speaker #13: What does that mean for for the 2028 targets of 15.5 billion in gross profit and adjusted EPs of five , 50 . And I think it was 4 billion in free cash flow ?

Speaker #13: What's the bridge that needs that? You need now to get there, or are those targets a little bit different? Thank you.

Speaker #1: Hey Brian , thanks for the question . You know , at the simplest level , what you're hearing from us today is we believe we have a path to accelerate the strategies we laid out at Investor Day .

Amrita: Hey, Bryan. Thanks for the question. At the simplest level, what you're hearing from us today is we believe we have a path to accelerate the strategies we laid out at Investor Day. We've meaningfully raised our 2026 outlook, not just on profitability, but also on gross profit, showing that path to exiting this year still in that mid-teens growth range, which is really important as we think about heading into 2027 and 2028. Because of the strong unit economics and incremental profitability in our business, that leads to that path of compounding profitability at a greater rate than gross profit. While we're not updating our Investor Day targets on 2027 and 2028 today, what you see is a really credible and profitable path to delivering compounding profitability at meaningful scale in that 2027-2028 view for our business.

Amrita Ahuja: Hey, Bryan. Thanks for the question. At the simplest level, what you're hearing from us today is we believe we have a path to accelerate the strategies we laid out at Investor Day. We've meaningfully raised our 2026 outlook, not just on profitability, but also on gross profit, showing that path to exiting this year still in that mid-teens growth range, which is really important as we think about heading into 2027 and 2028. Because of the strong unit economics and incremental profitability in our business, that leads to that path of compounding profitability at a greater rate than gross profit. While we're not updating our Investor Day targets on 2027 and 2028 today, what you see is a really credible and profitable path to delivering compounding profitability at meaningful scale in that 2027-2028 view for our business.

Speaker #1: We've meaningfully raised our 2026 outlook not just on profitability , but also on gross profit , showing that path to exiting this year still , in that mid-teens growth range , which is really important as we think about heading into 27 and 28 because of the strong unit economics and incremental profitability in our business that leads to that path of compounding profitability at a greater rate than gross profit .

Speaker #1: So, while we're not updating our Investor Day targets on 27 and 28 today, what you see is a really credible and profitable path to delivering compounding profitability at meaningful scale.

Speaker #1: In that 2728 view for our business . And we couldn't be more excited to get to work for 2026 .

Amrita: We couldn't be more excited to get to work for 2026.

Amrita Ahuja: We couldn't be more excited to get to work for 2026.

Operator: Thank you for participating in today's call. You may now disconnect.

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