TLDR
- Block rose 7.9% after hours to $75.70 after Q1 earnings of $0.85 per share beat the $0.68 estimate by 25.68%
- Gross profit climbed 27% year-over-year to $2.91 billion, with Cash App up 38%
- Block recorded a $173.8 million Bitcoin remeasurement loss, contributing to a $309 million net quarterly loss — its first in three years
- Bitcoin revenue dropped 26% due to trading dynamics and a fee reduction on Cash App transactions
- Block raised full-year guidance, targeting 19% gross profit growth and 62% adjusted EPS growth in 2026
Block Inc posted Q1 2026 earnings of $0.85 per share on an adjusted basis, beating the Zacks consensus estimate of $0.68 — a 25.68% earnings surprise. The stock jumped 7.9% in after-hours trading to $75.70.
$XYZ (Block) #earnings are out: pic.twitter.com/AlBWXWgJBA
— The Earnings Correspondent (@earnings_guy) May 7, 2026
Total gross profit rose 27% year-over-year to $2.91 billion. Cash App led the charge with 38% gross profit growth to $1.91 billion, driven by lending, banking, and commerce.
Adjusted operating income surged 56% to $728 million. That pushed adjusted operating margins to a record 25% of gross profit.
On an adjusted EPS basis, Block grew 52% year-over-year. The company called out “strong execution” as the reason for raising its full-year outlook.
Block now expects 19% gross profit growth for the full year 2026, along with adjusted diluted EPS growth of 62%. That’s a meaningful step up from prior guidance.
The headline numbers don’t tell the whole story, though. Block posted a net loss of $309 million for the quarter — its first quarterly loss since 2023.
A $172.8 million Bitcoin remeasurement loss on its corporate treasury was a key driver of that net loss. Block held 8,883 Bitcoin as of March 31, with total BTC holdings — including customer balances — sitting at 28,355 BTC, valued at roughly $2.2 billion.
Bitcoin revenue across Block’s products fell to $1.8 billion from $2.33 billion a year ago, a drop of roughly 26%. Block attributed this to changing “Bitcoin trading dynamics” and a decision to cut fees on certain Cash App Bitcoin transactions.
Cash App’s Bitcoin business specifically was down 31% year-over-year. Square reported no meaningful Bitcoin activity, with crypto contributing roughly $28 million in revenue — offset by equivalent costs.
Bitcoin Expansion Continues Despite Revenue Drop
Despite the revenue decline, Jack Dorsey isn’t pulling back on Bitcoin. In late April, Block launched a proof-of-reserves for its corporate Bitcoin treasury and for Cash App and Square users.
Block also unveiled a new Bitkey hardware wallet with a touchscreen, and added a Cash App feature letting certain users auto-convert payments into Bitcoin.
Square merchants can now earn 5% Bitcoin cash back rewards. Customer withdrawal limits were raised fivefold to $10,000 per day and $25,000 per week.
Over 800,000 US-based merchants have enabled Bitcoin transactions through Block’s network, according to a late April announcement.
Workforce Cuts and Cost Pressures
Block’s operational expenses rose 57.2% year-over-year to $3.08 billion in Q1. That followed a major restructuring in late February, when Dorsey announced roughly 4,000 job cuts — about 40% of the workforce.
Since those cuts were announced, Block’s stock has risen approximately 25%.
Avory & Co. founder Sean Emory said Block had a “strong quarter,” noting the company “beat and raised” its guidance across the board.
