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.
🚨 Our MAY Stock Picks Are Live!
A new month means new opportunities. Our analysts have just released their top stock picks for May, highlighting companies with strong momentum that rank highly on our KO Score algorithm. We’re also now sharing trade ideas for both long-term and short-term investors, giving you more ways to spot potential opportunities in the market.
Sign up to Knockout Stocks today and get 50% off to unlock the full list and see which stocks made the cut.
Use coupon code Special50 for your exclusive discount!
Get 3 Free Stock Ebooks
Discover top-performing stocks in AI, Crypto, and Technology with expert analysis.
- Top 10 AI Stocks - Leading AI companies
- Top 10 Crypto Stocks - Blockchain leaders
- Top 10 Tech Stocks - Tech giants
