Block, Inc. Q3 FY2025 earnings call

• Cash App: Focus on growing monthly actives via network enhancements, engagement, and product innovation. Launched Cash App Releases, expanded Borrow, and saw growth in primary banking actives. - Square: Focus on powering the neighborhood, connecting sellers and consumers at scale, delivering world-class AI tools to sellers, and making selling easier with new software solutions. - Proto: Generated first revenue from Bitcoin mining hardware sales.

Cash App: Gross profit grew 24% year-over-year to $2.66 billion. Monthly actives reached 58 million in September. Primary banking actives grew 18% year-over-year to 8.3 million. Borrow originations grew 134% year-over-year. Post-purchase Buy Now Pay Later on Cash App Card reached $3 billion in annualized originations. Square: Gross profit grew 9% year-over-year in the third quarter, GPV grew 12%. Adjusted EBITDA was $833 million, and adjusted operating income was $480 million in the third quarter.

• Increased full-year guidance for Q4, expecting gross profit to grow over 19% year-over-year to $2.755 billion. Adjusted operating income margins expected to expand to 20% and deliver $560 million in adjusted operating income. Full-year gross profit expected to be $10.243 billion, reflecting over 15% year-over-year growth. Tax rate expected in the mid-20% range, net interest expense of $45 million in Q4.

• Macro-economic conditions could cause actual results to differ from forward-looking statements. - Operational flexibility decision created a ~2.6 percentage point headwind to Square gross profit in Q3, expected to lap in Q2 2026.

Q: Can you give a progress report on Cash App actives growth and network density?

A: Owen Jennings mentioned 58 million monthly actives in September, with acceleration in year-over-year growth for monthly actives in October. Focus on net new acquisition and engagement, with key focus areas including network enhancements, multiplayer money, and teens/family.

Q: Talk about field sales teams and their productivity?

A: Nicholas Molnar said sales-led NVA was up 28% year-to-date through September, with sales team scaling fast. Self-onboarding growth is strong, with 70% of NVA still from self-onboarding.

Q: Touch on Borrow product and credit quality?

A: Amrita Ahuja said Borrow origination volume up 134% year-over-year, with healthy risk loss rates below 3% and annualized net margins at 24%. Borrow actives have higher inflows, spend, and retention rates.

Q: Visibility on 4Q guide and macro?

A: Amrita Ahuja said 4Q guide is based on strong third quarter performance, October metrics, and healthy returns on investments. No meaningful macro impacts seen yet.

Q: Square's competitive momentum and pricing?

A: Owen Jennings said strong NVA growth, low churn rates, and wins against legacy systems. Pricing updated to a simple 3-tier system for software products, simplifying and streamlining the ecosystem.