Block, Inc. · Earnings release

Shareholder Letter

investors.block.xyz

To Our Shareholders

Our growth in the first half of this year does not meet our bar, and we remain confident in our ability to accelerate Block’s gross profit

growth in the second half of 2025 and beyond. Cash App gross profit growth came in below our expectations, largely driven by softer inflows and Cash App Card spend than we had forecasted. We saw changes to consumer spending as the quarter

progressed that we believe drove the majority of our forecast miss.

We

understand the drivers behind our recent deceleration in growth and have incorporated updated views on the macro environment into our revised guidance for the year. We believe Cash App gross profit growth, and Block gross profit growth overall,

will significantly accelerate starting in the third quarter.

We’re

currently rolling out a number of new features that we’ve been testing at scale for some time. First, we are rolling out Cash App Borrow (small dollar, short duration loans) to millions more Cash App actives and nearly doubling the number of

actives we can serve after receiving FDIC approval to use Square Financial Services to issue consumer loans for Cash App Borrow nationwide. Second, we are evolving Borrow terms which we expect will allow us to increase limits and improve the

customer experience. Our machine learning models leverage real-time customer data, which we’ve used to maintain healthy loss rates for Borrow across historical cohorts. Third, we will be increasing Borrow limits for Paycheck Deposit actives

as a tool to drive paycheck deposit engagement with our base.

We expect

these enhancements to Cash App Borrow will drive gross profit growth through increased originations and improved unit economics. In addition, we believe they will drive benefits to retention, customer engagement, direct deposit attach rates,

and inflows. More than half of Borrow loans are used within the Cash App ecosystem. We’ve also seen paycheck deposit actives that receive a Borrow offer are nearly 2.5x more likely to accept it compared to Cash App Card actives and over 13x

more likely than non Cash App Card actives.1

While we’ve made progress on banking adoption, we’ve been too narrow in our focus.2 We want to expand the underlying Cash App network to drive actives growth and density. We’re now addressing 3 key areas:

1) Network density: We’ve prioritized web-based signup, new P2P

features, and improving our referrals/invites and funnel. We’re also re-prioritizing a more concerted effort to attract and engage teens and families, a group we believe is massively underserved and one we’re well-positioned to

support. With Cash App’s product depth, scale, and cultural relevance, we’re in a strong position to serve teens needs in a safe and trusted way.

Gross Profit

+9% YoY Growth

Cash App Gross Profit

+10% YoY Growth

Square Gross Profit

+9% YoY Growth

Operating Income4

Adjusted

Operating Income

Net Income5

Adjusted EBITDA

1 Based on the number of Borrow loans offered in March 2025 that were accepted between March 1, 2025 and April 29, 2025.

2 Square and Cash App are financial services platforms,

not banks. Throughout this letter, any reference to Square or Cash App’s banking offerings such as “bank our base,” “banking offerings,” “banking capabilities”, “banking products,” “digital

banking,” “Square Banking,” or “Square Checking” refer to products and services that are offered through Block’s Industrial Bank, Square Financial Services, Inc., or through our third-party bank partners.

3 Reconciliations of non-GAAP financial measures used in

this letter to their nearest GAAP equivalents are provided at the end of this letter.

Please see these reconciliations

for additional detail and a description of certain items that affected operating income (loss) and net income (loss) in the first quarter of 2025.

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

5 Net income attributable to common

stockholders.

1

2) Optimizing product controls: We’ve done a lot of work to make Cash App healthier and

more resilient. However, we’ve observed that some of the controls we implemented unintentionally disrupted good customers. We’re refining our approach and increasingly focused on ensuring customers can rely on Cash App to run their

financial lives, without compromising our ability to prevent and remove unwanted activity from the platform. These changes will contribute positively to growth going forward.

3) Increasing high-ROI marketing spend: After resetting marketing measurement last year, we’re continuing to increase our investment across

channels. We’re increasing marketing spend nearly 50% in Q2 compared to Q1 to drive actives growth and engagement while maintaining strong ROI thresholds. We’re scaling our national Banking campaign in Q2 and we’re launching a new

campaign focused on commerce and Cash App Afterpay.

Our updated 2025 outlook is not dependent on these 3 initiatives, but we believe there’s

something meaningful here.

Square has shipped products and features faster and we’ve increased our go-to-market investments

across sales, partnerships, and marketing. In Q4 we saw initial signs that this was driving progress. After Q1 we’re increasingly confident these investments are paying off. In the first quarter, we gained market share in our core

verticals and we exceeded volume targets across our sales and partnerships channels. This gives us the confidence to continue ramping our go-to-market investments.

More large sellers are seeing Square as a partner to help them grow their business, and we’re going to keep delivering products that give our

sellers time back through automation and AI. We grew GPV 8.2% year over year on a constant currency basis in Q1 and believe we will only improve growth from here.

We will be hosting our first ever seasonal release event for Square on May 13th where we will share over 100 product and feature launches with new

and existing sellers. We expect these events to be a key part of our product release cadence going forward. This is a key part of the overall go-to-market motion changes we’ve been executing against as we focus on re-accelerating customer

acquisition and deepening engagement across our product suite with existing sellers.

Finally, we’re shifting the entire company to build

and use agentic systems. We helped lead the industry here with codename:goose and MCP, which many of our peers have taken an interest in and expanded. Our initial focus was to improve engineering productivity, which it has by ~30% already.

We’re now expanding the use of these agentic systems to every role in the company.

Our first goal is to make goose our single interface

for all of our functions to enable us to ship faster and be more efficient, and effectively automate the entire company in a way that wasn't possible before. Our second goal is to weave goose into our consumer and seller interfaces so that our

customers have a personal CFO and COO respectively to help automate nearly all of their financial and operational workflows. We are creating an intuitive natural language interface (typed or spoken) that can prompt our customers

proactively given our deep understanding of them based on 16 years of experience. We’ll achieve both of these goals by the end of this year.

Taken together, we anticipate Block topline growth to accelerate from a low point in the first half to the mid-teens in Q4. Improvements in Cash App

gross profit will be the primary driver of the overall acceleration in Block topline but we also expect to see faster growth in Square and the first gross profit contributions from Proto, as we deliver our first chips and systems in the second half

of the year. Removing macro volatility, we believe we’re now focused on all the right drivers to call this the bottom, and we’ll be able to achieve acceleration of everything going forward.

2

Business Highlights

Cash App

We are focused on driving adoption of our

financial services products.

In March, Square Financial Services — our industrial bank — received approval from the FDIC to offer

consumer loans nationwide through Cash App Borrow. This milestone enables us to accelerate gross profit by increasing loan availability as we expand into more states and improves unit economics by originating and servicing the loans ourselves. This

reflects the power of our ecosystem and the unique value of our shared infrastructure across Square and Cash App.

In the first quarter, we started

allowing eligible paycheck deposit actives to immediately access our Borrow offering.6 To showcase this new benefit and drive paycheck deposit adoption, we are leveraging in-app notifications, emails, and alerts to highly engaged Cash App Card actives.

We’re also increasing our

use of incentives and targeted campaigns across the customer journey. Cash App Card remains a key entry point into our broader ecosystem. Our strategy focuses on attracting these customers and encouraging deeper engagement through products like Cash

App Borrow and direct deposit. To drive new customer growth, we’re testing Cash App Card referrals.

In March, we launched Cash App Afterpay

in the U.S., allowing eligible Cash App actives to use Afterpay’s Pay-in-Four or pay monthly products directly when shopping online at partner merchant sites —

a meaningful product unlock as we deepen the connection between our ecosystems.7 We’re focused on driving customer awareness for this offering, and we are incredibly

excited by the long-term value of helping drive demand for our merchant partners while expanding access to credit for consumers.

We see an opportunity to expand

our network over time.

We launched our largest-ever national brand campaign in March, which will run throughout the year in 15 priority markets

— selected for their strong network and Cash App Card density. The campaign highlights the full suite of Cash App’s financial services products with a goal of building trust and awareness, as well as shifting perceptions towards Cash App

being an all-in-one financial solution. These ads will air across multiple in-person and digital channels, and upcoming videos

will focus on our newly branded Cash App Afterpay, building awareness for our customers.

Beyond brand, we’re scaling performance and

life-cycle marketing to drive growth, while finding ways to make Cash App more easily discoverable. In April, we enabled new customers to sign up for Cash App on a desktop. We believe this can be a major acquisition channel for Cash App because it

unlocks new marketing opportunities such as paid search and makes Cash App more easily discoverable.

We believe we have significant network growth

potential with teen customers. By winning these customers early in their financial journey we can grow with them as they mature, as their income grows, and as they engage with more of our banking products over time. In April, we launched our first

teen referrals campaign.

6 A paycheck deposit active is a Cash App account that receives ACH inflows during a specified

period, but excludes tax refunds and ACH transfers.

7 A transacting active is a

Cash App account that has at least one financial transaction using any product or service within Cash App during a specified period. A transacting active for a specific Cash App product has at least one financial transaction using that product

during the specified period and is referred to as an active. Examples of transactions include sending or receiving a peer-to-peer payment, transferring money into or out

of Cash App, making a purchase using Cash App Card, earning a dividend on a stock investment, and paying back a loan, among others. Certain of these accounts may share an alias identifier with one or more other transacting active accounts. This

could represent, among other things, one customer with multiple accounts or multiple customers sharing one alias identifier (for example, families).

3

Square

We’re establishing ourselves as the leading technology platform for neighborhood businesses, increasing market share across verticals as we

accelerate product velocity and enhance our go-to-market motion.

We’re giving sellers better visibility into our ongoing cadence of product innovation by showcasing more than 100 commerce, software, hardware, and

banking product and feature launches at our first biannual product release event on May 13.

We expect to drive better discovery of our ongoing

product innovation for sellers, including our new Square Online experience. This product automatically sets up food and beverage sellers with a simple, effective online ordering page as soon as they sign up for Square and allows them to easily

manage their online store via a new, simplified experience built into their Square Dashboard.

We continue to make it easier for sellers to get

paid faster.

We believe Square Checking is the fastest way for our sellers to get paid, and we’re making it the default settlement option

for solo entrepreneurs. We believe making Square Checking the default option will drive higher retention by enabling more sellers to discover our banking features at the beginning of their relationship with us.

We’ve made improvements to our core risk capabilities to enable sellers to send larger invoice amounts, up to $1 million. Many of our

professional services sellers have less frequent but large invoices, and these improvements help us serve them more effectively and capture more wallet share.

We’re delivering tangible results for quick-serve restaurants, a key early focus of our neighborhood network strategy.

We’ve been able to lower on-demand delivery fees for key courier partners, allowing our sellers to keep

more of their sales made through third parties.

Square is launching an enhanced integration experience for UberEats and DoorDash, improving the

onboarding, setup, menu and order syncing experience for sellers so they can integrate with delivery partners in a matter of minutes.

We’re scaling with larger businesses that operate across multiple channels, process higher volumes, and act as trendsetters in their local

communities.

Our rapidly growing field sales team is delivering results. This quarter we signed several new large sellers including Bambu

Dessert and Drinks, a 60-location food and beverage seller in the U.S. that chose Square to be its partner as it expands into hundreds of locations across the country. Bambu Dessert and Drinks chose Square due

to our ability to provide more advanced control over the franchise’s backend menu and loyalty options. We also signed Five O Fore Entertainment — a premium golf and entertainment venue in New Orleans that chose Square because of our

ability to provide an integrated system that streamlined its complex restaurant, bar, retail, and event booking operations.

Partnerships have

helped expand our reach and accelerate lead generation across both domestic and international markets.

We continue to sign new partnerships

globally across vertical, horizontal, and third-party sales organizations. We expect to continue investing in these channels, which enable us to expand our distribution footprint to serve more sellers locally. We are seeing strong success with

third-party sales organizations internationally, as they are now driving a growing percentage of new sales leads across our international markets.

We grew marketing spend by 33% year over year in the first quarter and continued to see strong returns.

4

Financial Discussion

We grew gross profit 9% year over year and achieved a 20% Adjusted Operating Income margin in the first quarter. While the gross profit growth we

delivered in the first quarter was lower than our expectations, we continue to make strong progress on our strategic initiatives across Block. We are maintaining our focus on enhancing profitability while investing in long-term growth. We continue

to expect to accelerate growth in the second half of 2025 and expect to exit 2025 with gross profit growth in the mid-teens range. We continue to view Rule of 40 as our guiding financial framework and believe we are well positioned entering 2026.8

First Quarter 2025 Financial Highlights

Gross Profit

We delivered year-over-year gross profit growth of 9% as we continue to launch new products across Square and Cash App to accelerate

our growth at scale.

Profitability

We drove strong operating income and outperformed our Adjusted Operating Income guidance in the first quarter of 2025. Operating

income was $329 million while Adjusted Operating Income was $466 million. Net income attributable to common stockholders was $190 million and Adjusted EBITDA was $813 million.

Square Gross

Payment

Volume (GPV)

In the first quarter, total Square GPV grew 7.2% (8.2% in constant currency), with U.S. GPV growing 5.6% and International GPV

growing 15% (21% in constant currency).9 Excluding leap day in 2024, Square GPV grew 9.4% in constant currency as we continued to gain market share across our target

verticals.

Gross Profit

per Monthly

Transacting

Active

In the first quarter, Cash App’s gross profit per monthly transacting active grew 9% year over year to $81.10 We continued to invest in products like Cash App Borrow and Cash App Card as we lean into increasing engagement of our actives.

Guidance

We recognize we are operating in a more dynamic macro environment, so we have reflected a more cautious stance on the macro

outlook into our guidance for the rest of the year. We now expect $9.96 billion in gross profit for 2025, for growth of 12% year over year. We expect gross profit in the second quarter to grow 9.5% year over year to $2.45 billion and we expect to

accelerate gross profit growth meaningfully in the second half of the year as we execute on our strategies to deepen engagement with Cash App customers as we expand Borrow and retroactive BNPL to more customers.

8 Rule of 40 is the sum of our gross profit growth and Adjusted Operating Income margin as a

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

9 Square GPV is defined as the total dollar amount of all card and bank payments processed by

sellers using Square, net of refunds.

10 Gross profit per monthly transacting

active is calculated based on Cash App annualized gross profit excluding our BNPL platform during a given quarter divided by the monthly transacting actives for the last month of the quarter. Gross profit for our BNPL platform was $237 million

for the first quarter of 2025.

5

Block Financial Metrics

Gross Profit ($M)

YoY Growth

9%

Operating Income (Loss) ($M)

Operating Income (Loss) Margin (%) of gross profit

1%

Adjusted Operating Income ($M)

Adjusted Operating Income Margin (%) of gross profit

Diluted Net Income Per Share (“EPS”) ($)

Adjusted Diluted EPS ($)11

Block grew gross profit 9% year over year in the first quarter, with 10% year-over-year growth in Cash App and 9% year-over-year growth in Square.

Within Cash App, gross profit growth was driven by Cash App Borrow, Cash App Card, and BNPL. For Square, growth was driven by banking products and software and integrated payments. On a GAAP basis, we generated $329 million of operating income

compared to $250 million in the first quarter of 2024. We achieved our highest-ever quarterly Adjusted Operating Income at $466 million, which grew 28% year over year as we continued to focus on speed of execution and product velocity. On

a GAAP basis, we delivered diluted EPS of $0.30 and grew Adjusted EPS to $0.56, representing a 19% increase year over year.

11 Beginning in fiscal 2025, we revised our definition of Adjusted Net Income Per Share

(“Adjusted EPS”) to include stock-based compensation. We believe this change provides a more comprehensive view of our operating performance and aligns with our non-GAAP measure of Adjusted Operating Income. Prior period amounts have been

recast to reflect the updated presentation.

6

Cash App

Cash App Gross Profit ($M)

YoY Growth

Cash App Operating Metrics

Cash App Monthly Transacting Actives (M)

YoY Growth

6%

5%

3%

2%

0%

Cash App Card Monthly Transacting Actives (M)

YoY Growth

9%

7%

Total Cash App Inflows

YoY Growth

8%

Inflows Per Transacting Active

YoY Growth

9%

8%

Monetization

YoY Growth (bps)

7

9

9

3

1

Gross Profit Per Monthly Transacting Active ($)15

YoY Growth

9%

Cash App gross profit increased 10% year over year, driven by growth across Cash App Borrow, Cash App Card, and BNPL.

Gross profit per transacting active reached $81 in the first quarter, up 9% year over year, and inflows per transacting active in the first quarter

were $1,355, up 8% year over year, driven by more customers bringing their paychecks into Cash App. Cash App’s paycheck deposit monthly actives grew year over year as we continued to execute on the “bank our base” strategy.

Our BNPL platform gross merchandise value (GMV) reached $7.89 billion, growing 13% and 16% year over year on a reported and constant currency

basis, respectively, driven by sustained growth in our Pay-in-Four offering and Gift Cards’ eligibility expansion. BNPL platform gross profit was $237 million,

up 14% year over year.

12 Historically, our Cash App ecosystem has experienced improvements in revenue, gross profit,

and inflows related to the distribution of government funds as customers have deposited more funds into Cash App during these times, including during the first quarter when U.S. tax refunds are typically distributed.

13 Inflows per transacting active refers to total inflows in the quarter divided by monthly

actives for the last month of the quarter. Inflows refers to funds entering the Cash App ecosystem. Inflows does not include the movement of funds when funds remain in the Cash App ecosystem or when funds leave the Cash App ecosystem, or inflows

related to the Afterpay or Verse apps. Inflows from Verse actives were not material to overall inflows.

14 We calculate monetization rate by dividing Cash App gross profit, excluding contributions from our BNPL platform, by Cash App inflows.

15 Gross profit per monthly transacting active is calculated based on Cash App annualized gross

profit excluding our BNPL platform during a given quarter divided by the monthly transacting actives for the last month of the quarter. Gross profit for our BNPL platform was $208 million or $831 million on an annualized basis for

Q1’24, $220 million or $881 million on an annualized basis for Q2’24, $242 million or $968 million on an annualized basis for Q3’24, $298 million or $1.19 billion on an annualized basis for Q4’24,

and $237 million or $948 million on an annualized basis for Q1’25.

7

Square

Square Gross Profit ($M)

YoY Growth

9%

International Gross Profit ($M)

YoY Growth

Total Square GPV ($M)

YoY Growth

Constant Currency (”CC”) GPV YoY Growth

Square U.S. GPV

YoY Growth

% of Total Square GPV

Square International GPV

YoY Growth

CC GPV YoY Growth

% of Total Square GPV

Square GPV in the first quarter was $54.1 billion, up 7.2% and 8.2% year over year on a reported and constant currency basis, respectively. On a

year-over-year basis in the first quarter, GPV from food and beverage was up 10% and GPV from retail and services were up 7% and 5%, respectively. We saw a more pronounced acceleration in year-over-year growth for ourmid-market seller segments (>$500K in annualized GPV) compared to our other seller segments during the first quarter.

Growth in Square gross profit was driven primarily by our banking products and software and integrated payments as we continued to move upmarket and

expand our market share in our target verticals.

8

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

Operating Expenses

Restructuring Share-Based Compensation

7

-

-

1

Amortization of Customer and Other Acquired Intangible Assets

Acquisition-Related and Integration Costs

1

1

0

Contingencies, Restructuring and Other Charges

Goodwill and Intangible Asset Impairment

-

-

-

-

Non-GAAP Operating Expenses

In

the first quarter, product development expenses were up 6% year over year on a GAAP basis, driven primarily by an increase in restructuring costs, including severance and other related expenses, as well as cloud costs. Sales and marketing expenses

grew 14% year over year on a GAAP basis, driven by an increase in go-to-market investments across our business. Cash App marketing expenses were up 9% on a GAAP basis in

the first quarter, driven primarily by brand awareness campaigns partially offset by improvements in peer-to-peer risk loss. Other sales and marketing expenses were up

20% year over year on a GAAP basis as we significantly increased go-to-market investment in Square. General and administrative expenses were up 4% year over year on a

GAAP basis. The increase was driven primarily by restructuring costs, including severance and other related expenses.

9

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

Operating Income

Adjusted Operating Income

Net Income

Adjusted Net Income

Weighted-average shares used to compute Diluted EPS

Weighted-average shares used to compute Adjusted Diluted EPS

Diluted EPS ($)

Adjusted Diluted EPS ($)16

Cash Flow ($M)

MONTHS

Net cash provided by operating activities

Consumer receivables cash flows included within investing activities in the GAAP statements of cash flows:

Payments for originations of consumer receivables

Proceeds from principal repayments and sales of consumer receivables

Less: Purchase of property and equipment

Reversal of:

Changes in settlements receivable

Changes in customers payable

Changes in settlements payable

7

1

0

-

0

1

Sales, principal payments and forgiveness of PPP loans

(1)

(1)

(1)

(1)

(1)

(4)

Adjusted Free Cash Flow

YoY Growth

Net cash provided by (used in) investing activities

Net cash provided by (used in) financing activities

16 Beginning in fiscal 2025, we revised our definition of Adjusted EPS to include stock-based compensation. We

believe this change provides a more comprehensive view of our operating performance and aligns with our non-GAAP measure of Adjusted Operating Income. Prior period amounts have been recast to reflect the updated presentation.

Net cash provided by operating activities was $1.4 billion for the twelve months ended

March 31, 2025, compared to $296 million for the twelve months ended March 31, 2024. We grew Adjusted FCF by more than 43% year over year to $1.5 billion for the twelve months ended March 31, 2025. In the first quarter of

2025, we continued to prudently invest in our lending products while focusing on returning capital to shareholders. We sell a majority of Square Loans to investors and utilize warehouse facilities to reduce Block capital required to fund BNPL

growth. We invested in growing Cash App Borrow given the strong unit economics and returns we have seen, and are evaluating balance sheet diversification strategies.

In the first quarter of 2025, we repurchased 6.8 million shares of our Class A common stock for an aggregate amount of $445 million. As

of March 31, 2025, $2.2 billion of our $4 billion share repurchase authorization remained available and authorized for repurchases.

We ended the quarter with $9.2 billion of total liquidity, with $8.5 billion in cash, cash equivalents, restricted cash, and investments in

marketable debt securities, as well as $775 million available to be withdrawn from our revolving credit facility.

Guidance

G1Gross Profit

YoY Growth

G2G3Adjusted Operating Income

% Margin

Rule of X

We recognize we are operating in a more dynamic macro environment, so we have reflected a more cautious stance on the

macro outlook into our guidance for the rest of the year. We now expect $9.96 billion in gross profit for 2025, for growth of 12% year over year.

We expect gross profit in the second quarter to grow 9.5% year over year to $2.45 billion and we expect to accelerate gross profit growth

meaningfully in the second half of the year as we execute on our strategies to deepen engagement with Cash App customers as we expand Borrow and retroactive BNPL to more customers. We expect to deliver low-double-digit gross profit growth in the

third quarter and mid-teens gross profit growth in the fourth quarter. Our expectation for accelerating growth includes the more cautious stance on the macro outlook, which is now factored into our guidance.

We expect to deliver $450 million of Adjusted Operating Income in the second quarter and $1.90 billion in Adjusted Operating Income

for the full year. We have continued to see attractive returns on go to market spend and healthy risk loss in our underwriting products. Our go to market and underwriting decisions are data driven and our updated guidance assumes that our investment

plans entering the year remain largely unchanged based on the strong returns we have seen. We will continue to be data driven and prudent in our growth investments as we monitor any changes in the macro environment.

17 We have not provided the forward-looking GAAP equivalents for certain forward-looking non-GAAP metrics, including Adjusted Operating Income (Loss), or GAAP reconciliations of any of the aforementioned, as a result of the uncertainty regarding, and the potential variability of, reconciling items such

as contingencies, restructuring and other charges. Accordingly, the Company has relied upon the exception in item 10(e)(1)(i)(B) of Regulation S-K to exclude such reconciliations, as the reconciliations of

these non-GAAP guidance metrics to their corresponding GAAP equivalents are not available without unreasonable effort. However, it is important to note that material changes to reconciling items could have a

significant effect on future GAAP results. We have provided reconciliations of other historical GAAP to non-GAAP metrics in tables at the end of this letter, as well as relevantnon-GAAP definitions.

G4Gross Profit

YoY Growth

G5G6Adjusted Operating Income

% Margin

Rule of X

18 We have not provided the forward-looking GAAP equivalents for certain forward-looking

non-GAAP metrics, including Adjusted Operating Income (Loss) or GAAP reconciliations of the aforementioned, as a result of the uncertainty regarding, and the potential variability of, reconciling items such as contingencies, restructuring, and other

charges. Accordingly, the Company has relied upon the exception in item 10(e)(1)(i)(B) of Regulation S-K to exclude such reconciliations, as the reconciliations of these non-GAAP guidance metrics to their corresponding GAAP equivalents are not

available without unreasonable effort. However, it is important to note that material changes to reconciling items could have a significant effect on future GAAP results. We have provided reconciliations of other historical GAAP to non-GAAP metrics

in tables at the end of this letter.

Earnings Webcast

Block (NYSE:XYZ) will host a conference call and earnings webcast at 2:00 p.m. Pacific time/5:00 p.m. Eastern time, May 1,

to discuss these financial results. To register to participate in the conference call, or to listen to the live audio webcast, please visit the Events & Presentations section of Block’s Investor Relations website atinvestors.block.xyz. A replay will be available on the same website following the call. We will release financial results for the second quarter of 2025 on August 7, 2025, after the market closes, and will also host

a conference call and earnings webcast at 2:00 p.m. Pacific time/5:00 p.m. Eastern time on the same day to discuss those financial results.

Media Contact

press@block.xyz

Investor Relations Contact

ir@block.xyz

Jack Dorsey

Amrita Ahuja

Safe Harbor Statement

This letter contains “forward-looking statements” within the meaning of the Safe Harbor provisions of the U.S. Private

Securities Litigation Reform Act of 1995. All statements other than statements of historical fact could be deemed forward-looking, including, but not limited to, statements regarding the future performance of Block, Inc. and its consolidated

subsidiaries (the Company); the Company’s strategies, including expected impact of such strategies on our customers, actives, and sellers; our business and financial performance, expected financial results, guidance, and general business

outlook for current and future periods, including trends in U.S. and global GPV and statements that the Company’s performance will accelerate; our ability to manage our risk losses; the Company’s plans with respect to its emerging

initiatives and product development plans and product launches, including expectations regarding the growth of Cash App Borrow and Cash App Afterpay and the Company’s ability and timing to integrate artificial intelligence into its products;

the ability of the Company’s products to attract and retain sellers and customers, particularly in new or different markets or demographics or through partnerships, sales organizations or advertising campaigns; trends in the Company’s

markets and the continuation of such trends; the Company’s expectations and intentions regarding future expenses and marketing investments; and management’s statements related to business strategy, plans, investments, opportunities, and

objectives for future operations. In some cases, forward-looking statements can be identified by terms such as “may,” “will,” “appears,” “should,” “expects,” “plans,”

“anticipates,” “could,” “intends,” “target,” “projects,” “contemplates,” “believes,” “estimates,” “predicts,” “potential,” or “continue,”

or the negative of these words or other similar terms or expressions that concern our expectations, strategy, plans, or intentions. Such statements are subject to a number of known and unknown risks, uncertainties, assumptions, and other factors

that may cause the Company’s actual results, performance, or achievements to differ materially from results expressed or implied in this letter. Investors are cautioned not to place undue reliance on these statements, and reported results

should not be considered as an indication of future performance.

Risks that contribute to the uncertain nature of the

forward-looking statements include, among others, a deterioration of general macroeconomic conditions; the Company’s investments in its business and ability to maintain profitability; the Company’s efforts to expand its product portfolio

and market reach; the Company’s ability to develop products and services to address the rapidly evolving market for payments and financial services; the Company’s ability to deal with the substantial and increasingly intense competition in

its industry; acquisitions, strategic investments, entries into new businesses, joint ventures, divestitures, and other transactions that the Company may undertake; the Company’s ability to ensure the integration of its services with a variety

of operating systems and the interoperability of its technology with that of third parties; the Company’s ability to successfully integrate artificial intelligence into its systems, initiatives, and products; the Company’s ability to

retain existing customers, attract new customers, and increase sales to all customers; the Company’s dependence on payment card networks and acquiring processors; the effect of extensive regulation and oversight related to the Company’s

business in a variety of areas; risks related to the banking ecosystem, including through our bank partnerships, and FDIC and other regulatory obligations; the liabilities and loss potential associated with new products, product features, and

services; litigation, including intellectual property claims, government investigations or inquiries, and regulatory matters or disputes; the adequacy of reserves for such matters and the impact of any such matters or settlements thereof on our

business; adoption of the Company’s products and services in international markets; changes in political, business, and economic conditions, including changes due to actual or potential tariffs; as well as other risks listed or described from

time to time in the Company’s filings with the Securities and Exchange Commission (the SEC), including the Company’s Annual Report on Form 10-K for the fiscal year ended December 31, 2024, and

its subsequent Quarterly Reports on Form 10-Q, which are on file with the SEC and available on the Investor Relations page of the Company’s website. Additional information will also be set forth in the

Company’s

Quarterly Report on Form 10-Q for the

quarter ended March 31, 2025. All forward-looking statements represent management’s current expectations and predictions regarding trends affecting the Company’s business and industry and are based on information and estimates

available to the Company at the time of this letter and are not guarantees of future performance. Earnings guidance for 2025 reflects assumptions the Company believes are reasonable as of the date of this filing and remains subject to changing

macroeconomic conditions and other risks and uncertainties outlined in this safe harbor section and in the Company’s periodic reports filed with the SEC. Except as required by law, the Company assumes no obligation to update any of the

statements in this letter.

Key Operating Metrics And Non-GAAP Financial Measures

To supplement our financial information presented in accordance with generally accepted accounting principles in

the United States (GAAP), from period to period, we consider and present certain operating and financial measures that we consider key metrics or are not prepared in accordance with GAAP, including Gross Payment Volume (GPV), Gross Merchandise Value

(GMV), Adjusted EBITDA, Adjusted EBITDA margin, Adjusted Net Income (Loss), Diluted Adjusted Net Income (Loss) Per Share (Adjusted EPS), Adjusted Operating Income (Loss), Adjusted Operating Income (Loss) margin, Adjusted Free Cash Flow, constant

currency, and non-GAAP operating expenses. We believe these metrics and measures are useful to facilitate period-to-periodcomparisons of our business and to facilitate comparisons of our performance to that of other payments solution providers. GPV includes Square GPV and Cash App Business GPV. Square GPV is defined as the total dollar amount of all card and bank

payments processed by sellers using Square, net of refunds. Cash App Business GPV comprises Cash App activity related to peer-to-peer transactions received by business

accounts and peer-to-peer payments sent from a credit card. GPV does not include transactions from our BNPL platform. We define GMV as the total order value processed on

our BNPL platform.

Adjusted Net Income (Loss) and Diluted Adjusted Net Income (Loss) Per Share (Adjusted EPS) are non-GAAP financial measures that represent our net income (loss) and net income (loss) per share, adjusted to eliminate the effect of restructuring share-based compensation expense, contingencies, restructuring, and

other charges; goodwill and intangible asset impairment; amortization of intangible assets; amortization of debt discount and issuance costs; gain or loss on revaluation of equity investments; remeasurement gain or loss on revaluation of bitcoin

investment; the gain or loss on the disposal of property and equipment; acquired deferred revenue and cost adjustments; the tax effect of one-time income tax benefits from deferred tax assets; and the tax

effect of non-GAAP net income adjustments, as applicable. Additionally, for purposes of calculating diluted Adjusted EPS, we add back cash interest expense on convertible senior notes, as if converted at the

beginning of the period, if the impact is dilutive. To calculate the diluted Adjusted EPS, we adjust the weighted-average number of shares of common stock outstanding for the dilutive effect of all potential shares of common stock. In periods when

we recorded an Adjusted Net Loss, the diluted Adjusted EPS is the same as basic Adjusted EPS because the effects of potentially dilutive items were anti-dilutive given the Adjusted Net Loss position.

Adjusted EBITDA and Adjusted EBITDA margin are non-GAAP financial measures that represent

our net income (loss), adjusted to exclude share-based compensation expense; restructuring share-based compensation expense; depreciation and amortization; contingencies, restructuring, and other charges; interest income and expense;

remeasurement gain or loss on bitcoin investment; other income and expense;

provision for (benefit from) income taxes; gain or loss on disposal of property and equipment; and acquired deferred revenue and cost adjustment, as applicable. Adjusted EBITDA margin is calculated as Adjusted EBITDA divided by gross profit.

Adjusted Operating Income (Loss) is a non-GAAP financial measure that

represents our operating income (loss), adjusted to eliminate the effect of amortization of acquired technology assets; contingencies, restructuring, and other charges; restructuring share-based compensation expenses; goodwill and intangible asset

impairment and amortization of customer and other acquired intangible assets. Adjusted Operating Income (Loss) margin is calculated as Adjusted Operating Income (Loss) divided by gross profit.

We also exclude from these measures certain acquisition-related and integration costs associated with business combinations, and

various other costs that are not reflective of our core operating performance. We exclude amortization of intangible assets arising from business combinations from Adjusted Net Income (Loss), Adjusted EPS, Adjusted Operating Income (Loss), and

Adjusted Operating Income (Loss) Margin because the amount of such expenses in any specific period may not directly correlate to the underlying performance of our ongoing business operations. Acquisition-related costs include amounts paid to redeem

acquirees’ unvested stock-based compensation awards; charges associated with holdback liabilities; and legal, accounting, and due diligence costs. Integration costs include advisory and other professional services or consulting fees necessary

to integrate acquired businesses. Other costs that are not reflective of our core business operating expenses may include contingencies, restructuring, and other charges; impairment charges; restructuring share-based compensation expense; and

certain litigation and regulatory charges. For Adjusted Net Income (Loss) and Adjusted EPS, we also add back the impact of the acquired deferred revenue and deferred cost adjustment, which was written down to fair value in purchase accounting, and

adjust for the tax effect of the non-GAAP net income adjustments.

Adjusted

Free Cash Flow is a non-GAAP financial measure that represents our net cash provided by operating activities adjusted for changes in settlements receivable; changes in customers payable; changes in settlements

payable; the purchase of property and equipment; payments for originations of consumer receivables; proceeds from principal repayments and sales of consumer receivables; and sales, and principal payments, and forgiveness of PPP loans. We present

Adjusted Free Cash Flow because we use it to understand the cash generated by our business and make strategic decisions related to our balance sheet, and because we are focused on growing our Adjusted Free Cash Flow generation over time. It is not

intended to represent amounts available for discretionary purposes. Constant currency growth is calculated by assuming international results in a given period and the comparative prior period are

translated from local currencies to the U.S. dollar at rates consistent with the monthly average rates in the comparative prior period. We discuss growth on a constant currency basis because a

portion of our business operates in markets outside the U.S. and is subject to changes in foreign exchange rates. Non-GAAP operating expenses is a non-GAAP financial

measure that represents operating expenses adjusted to remove the impact of restructuring share-based compensation; amortization; acquisition-related and integration costs; contingencies, restructuring and other charges; and goodwill impairment. We

have included Adjusted EBITDA, Adjusted EBITDA margin, Adjusted Operating Income (Loss), Adjusted Operating Income (Loss) margin, Adjusted Net Income, Adjusted EPS, and non-GAAP operating expenses because they

are key measures used by our management to evaluate our operating performance, generate future operating plans, and make strategic decisions, including those relating to operating expenses and the allocation of internal resources. Accordingly, we

believe that Adjusted EBITDA, Adjusted EBITDA margin, Adjusted Operating Income (Loss), Adjusted Operating Income (Loss) margin, Adjusted Net Income, Adjusted EPS, and non-GAAP operating expenses provide

useful information to investors and others in understanding and evaluating our operating results in the same manner as our management and board of directors. In addition, they provide useful measures for period-to-period comparisons of our business, as they remove the effect of certain non-cash items and certain variable charges that do not vary with our operations. We

have included measures excluding our BNPL platform because we believe these measures are useful in understanding the ongoing results of our operations. Adjusted EBITDA, Adjusted EBITDA margin, Adjusted Net Income, Adjusted Operating Income (Loss),

Adjusted Operating Income (Loss) margin, Adjusted EPS, and non-GAAP operating expenses, as well as other measures defined in the shareholder letter, such as measures excluding our BNPL platform, have

limitations as financial measures, should be considered as supplemental in nature, and are not meant as substitutes for the related financial information prepared in accordance with GAAP. We believe that the aforementioned metrics and measures

provide useful information about our operating results, enhance the overall understanding of our past performance and future prospects, and provide useful measures forperiod-to-period comparisons of our business, as they remove the effect of certain variable amounts, or they remove amounts that were not repeated across periods and

therefore make comparisons more difficult. Our management uses these measures to evaluate our operating performance, generate future operating plans, and make strategic decisions, including those relating to operating expenses and the allocation of

internal resources. These non-GAAP financial measures should not be considered in isolation from, or as a substitute for, financial information prepared in accordance with GAAP. These non-GAAP financial measures are not based on any standardized methodology prescribed by GAAP. Other companies, including companies in our industry, may calculate the non-GAAPfinancial measures differently or not at all, which reduces their usefulness as comparative measures.

Condensed Consolidated Statements of Operations

Unaudited

In thousands, except per share data

THREE MONTHS ENDED

Revenue:

Transaction-based revenue

$

$

Subscription and services-based revenue

Hardware revenue

Bitcoin revenue

Total net revenue

Cost of revenue:

Transaction-based costs

Subscription and services-based costs

Hardware costs

Bitcoin costs

Amortization of acquired technology assets

Total cost of revenue

Gross profit

Operating expenses:

Product development

Sales and marketing

General and administrative

Transaction, loan, and consumer receivable losses

Amortization of customer and other acquired intangible

assets

Total operating expenses

Operating income

Interest expense (income), net

)

Remeasurement loss (gain) on bitcoin investment

)

Other income, net

)

)

Income before income tax

Provision for income taxes

Net income

Less: Net loss attributable to noncontrolling interests

)

)

Net income attributable to common stockholders

$

$

Net income per share attributable to common stockholders:

Basic

$

$

Diluted

$

$

Weighted-average shares used to compute net income per share attributable to common stockholders:

Basic

Diluted

Condensed Consolidated Balance Sheets

In thousands, except per share data

UNAUDITED

Assets

Current assets:

Cash and cash equivalents

$

$

Settlements receivable

Customer funds

Consumer receivables, net

Loans held for sale

Other current assets

Total current assets

Goodwill

Acquired intangible assets, net

Deferred tax assets

Othernon-current assets

Total assets

$

$

Liabilities and Stockholders’ Equity

Current liabilities:

Customers payable

$

$

Accrued expenses and other current liabilities

Current portion of long-term debt

—

Warehouse funding facilities, current

—

Total current

liabilities

Warehouse funding facilities, non-current

Long-term debt

Othernon-current liabilities

Total liabilities

Commitments and contingencies

Stockholders’ equity:

Preferred stock, $0.0000001 par value: 100,000 shares authorized at March 31, 2025 and December 31,

—

—

Class A common stock, $0.0000001 par value: 1,000,000 shares authorized at March 31, 2025 and

December 31, 2024; 556,826 and 559,606 issued and outstanding at March 31, 2025 and December 31, 2024, respectively.

—

—

Class B common stock, $0.0000001 par value: 500,000 shares authorized at March 31, 2025 and

December 31, 2024; 60,049 and 60,070 issued and outstanding at March 31, 2025 and December 31, 2024, respectively.

—

—

Additional paid-in capital

Accumulated other comprehensive loss

)

)

Retained earnings

Total stockholders’ equity attributable to common

stockholders

Noncontrolling

interests

)

)

Total stockholders’

equity

Total liabilities and

stockholders’ equity

$

$

Condensed Consolidated Statements of Cash Flows

Unaudited

In thousands

THREE MONTHS ENDED

Cash flows from operating activities:

Net income

$

$

Adjustments to reconcile net income to net cash provided by operating activities:

Depreciation and amortization

Amortization of discounts and premiums and other non-cashadjustments

)

Non-cash lease expense

Share-based compensation

Loss on revaluation of equity investments

Remeasurement loss (gain) on bitcoin investment

Transaction, loan, and consumer receivable losses

Change in deferred income taxes

Purchases and originations of loans

)

Proceeds from payments and forgiveness of loans

Changes in operating assets and liabilities:

Settlements receivable

)

Customers payable

Settlements payable

)

Other assets and liabilities

)

Net cash provided by operating

activities

Cash flows from investing activities:

Purchases of marketable debt securities

)

Proceeds from maturities of marketable debt securities

Proceeds from sale of marketable debt securities

Payments for originations of consumer receivables

)

Proceeds from principal repayments and sales of consumer receivables

Purchases of property and equipment

)

Purchases of other investments

)

Net cash provided by investing

activities

Cash flows from financing activities:

Payments to redeem convertible notes

)

—

Proceeds from warehouse facilities borrowings

Repayments of warehouse facilities borrowings

)

Proceeds from the exercise of stock options and purchases under the employee stock purchase plan

Net increase in interest-bearing deposits

Repurchases of common stock

)

Change in customer funds, restricted from use in the Company’s operations

Net cash provided by (used in) financing

activities

)

Effect of foreign exchange rate on cash and cash equivalents

Net increase (decrease) in cash, cash equivalents, restricted cash, and customer

funds

)

Cash, cash equivalents, restricted cash, and customer funds,

beginning of the period

Cash, cash equivalents, restricted cash, and customer funds, end

of the period

$

$

Reportable Segment Disclosures

Unaudited

Information on the reportable

segments revenue and segment operating profit, as well as amounts for the “Corporate and Other” category, which includes products and services not assigned to reportable segments and intersegment eliminations (in thousands):

THREE MONTHS ENDED

Cash App

Square

Corporate

and Other

Total

Revenue:

Transaction-based revenue

$

$

$

—

$

Subscription and services-based revenue

Hardware revenue

—

Bitcoin revenue

—

—

Segment revenue

$

$

$

$

Less: Cost of revenue

Segment gross profit

$

$

$

$

Interest revenue

$

$

$

—

$

Amortization of acquired technology assets

$

$

$

—

$

THREE MONTHS ENDED

Cash App

Square

Corporate

and Other

Total

Revenue:

Transaction-based revenue

$

$

$

—

$

Subscription and services-based revenue

Hardware revenue

—

Bitcoin revenue

—

—

Segment revenue

$

$

$

$

Less: Cost of revenue

Segment gross profit

$

$

$

$

Interest revenue

$

$

$

—

$

Amortization of acquired technology assets

$

$

$

$

Operating Segment Disclosures

Unaudited

A reconciliation of total segment gross profit to the

Company’s income (loss) before applicable income taxes (in thousands):

THREE MONTHS ENDED

Total segment gross profit

$

$

Less: Product development

Less: Sales and marketing

Less: General and administrative

Less: Transaction, loan, and consumer receivable losses

Less: Amortization of customer and other intangible assets

Less: Interest expense (income), net

)

Less: Remeasurement loss (gain) on bitcoin investment

)

Less: Other income, net

)

Income before applicable income taxes

$

$

Select Operating Metrics and Non-GAAP Financial Measures

Unaudited

THREE MONTHS ENDED

Gross Payment Volume (GPV) (in millions)

$

$

Adjusted Operating Income (in thousands)

$

$

Adjusted EBITDA (in thousands)

$

$

Adjusted Net Income Per Share: (i)

Basic

$

$

Diluted

$

$

(i) Beginning in fiscal 2025, we revised our definition of

Adjusted Net Income Per Share to include stock-based compensation. Prior period amounts have been recast to reflect the updated presentation.

THREE MONTHS ENDED

Square GPV (in millions)

$

$

Cash App GPV (in millions)

Total GPV (in millions)

$

$

Key Metric Margins

Unaudited

In thousands, except for percentages

THREE MONTHS ENDED

Gross profit

$

$

Gross profit change (%) YoY

9%

Operating income

Operating income margin (%) of gross profit

Net income

Net income margin (%) of gross profit

8%

Adjusted Operating Income

Adjusted Operating Income margin (%) of gross profit

Adjusted EBITDA

Adjusted EBITDA margin (%) of gross profit

Adjusted Operating Income (Loss) and Margin

Unaudited

In thousands, except for percentages

THREE MONTHS ENDED

Operating income

$

$

$

$

$

Amortization of acquired technology assets

Acquisition-related and integration costs

Contingencies, restructuring and other charges

Restructuring share-based compensation

—

—

Goodwill and intangible asset impairment

—

—

—

—

Amortization of customer and other acquired intangible

assets

Adjusted Operating Income

$

$

$

$

$

Adjusted Operating Income margin (%) of gross profit

%

%

%

%

%

Adjusted EBITDA

Unaudited

In thousands

THREE MONTHS ENDED

Net income attributable to common stockholders

$

$

Net loss attributable to noncontrolling interests

)

)

Net income

Share-based compensation expense

Restructuring share-based compensation expense

Depreciation and amortization

Acquisition-related and integration costs

Contingencies, restructuring and other charges

Interest expense (income), net

)

Remeasurement loss (gain) on bitcoin investment

)

Other income, net

)

)

Provision for income taxes

Loss (gain) on disposal of property and equipment

)

Acquired deferred revenue and cost adjustment

Adjusted EBITDA

$

$

Adjusted EBITDA margin (%) of gross profit

%

%

Adjusted Free Cash Flow

Unaudited

In thousands

THREE MONTHS ENDED

TRAILING

Net cash provided by (used in) operating activities

$

$

$

$

)

$

Consumer receivables cash flows included within investing activities in the GAAP statements of cash

flows:

Payments for originations of consumer receivables

)

)

)

)

)

Proceeds from principal repayments and sales of consumer receivables

Less: Purchases of property and equipment

)

)

)

)

)

Reversal of:

Changes in settlements receivable

)

)

Changes in customers payable

)

)

)

Changes in settlements payable

)

Sales, principal payments and forgiveness of PPP loans

)

)

)

)

)

Adjusted Free Cash Flow

$

$

$

$

)

$

Net cash provided by (used in) investing activities

$

$

)

$

)

$

$

Net cash provided by (used in) financing activities

$

)

$

)

$

)

$

$

)

Adjusted Net Income and Adjusted EPS

Unaudited

In thousands, except per share data

THREE MONTHS ENDED

Net income attributable to common stockholders

$

$

$

$

$

Net loss attributable to noncontrolling interests

)

)

)

)

)

Net income

Acquisition-related and integration costs

Contingencies, restructuring and other charges

Restructuring share-based compensation expense

—

—

Goodwill and intangible asset impairment

—

—

—

—

Amortization of intangible assets

Amortization of debt discount and issuance costs

Loss (gain) on revaluation of equity investments

)

)

Remeasurement loss (gain) on bitcoin investment

)

)

)

Loss (gain) on disposal of property and equipment

)

Acquired deferred revenue and cost adjustment

Tax effect of one-time income tax benefits from deferred tax

assets

—

—

—

—

)

Tax effect of non-GAAP net

income adjustments

)

)

)

)

Adjusted Net Income - basic

$

$

$

$

$

Cash interest expense on convertible notes

Adjusted Net Income - diluted

$

$

$

$

$

Weighted-average shares used to compute net income per share attributable to common stockholders:

Basic

Diluted

Net income per share attributable to common stockholders:

Basic

$

$

$

$

$

Diluted

$

$

$

$

$

Weighted-average shares used to compute Adjusted Net Income Per Share:

Basic

Diluted

Adjusted Net Income Per Share:

Basic

$

$

$

$

$

Diluted

$

$

$

$

$