Block (NYSE: XYZ) shares climbed more than 4% in extended trading after the payments company reported second-quarter results that surpassed Wall Street expectations. Block, formerly trading under the ticker SQ, rebranded its listing to XYZ earlier this year as part of a broader corporate identity refresh reflecting its evolution beyond its original Square payment-processing roots.

For the three months ended June 30, Block posted adjusted earnings of $1.02 per share, well above the 87 cents per share forecast by analysts tracked by the London Stock Exchange Group (LSE: LSEG). Quarterly revenue reached $6.62 billion, beating consensus estimates of approximately $6.49 billion.

The company, led by CEO Jack Dorsey, also raised its full-year outlook. Block now projects 2026 gross profit of $12.51 billion, representing 21% year-over-year growth. The previous guidance had called for $12.33 billion, or 19% growth.

The results cap off a strong earnings season for U.S. payment companies, with Block's beat following solid reports from peers across the fintech and digital payments landscape.

Block Separates Bitcoin Activity from Core Operating Metrics

Block stated that it reviews performance using both GAAP and non-GAAP measures, placing the greatest emphasis on gross profit, adjusted operating income, and adjusted earnings per share.

"Bitcoin trading activity and changes in bitcoin prices have historically had modest impacts on Gross Profit, Adjusted Operating Income, and Adjusted Earnings per Share, but can create significant variability in reported revenue and GAAP net income. To provide greater transparency into these dynamics, we are reporting Cash App's Bitcoin Ecosystem revenue and the remeasurement of our bitcoin investment ahead of reported earnings," said Block.

The decision to break out bitcoin-related figures separately comes as Block has deepened its ties to cryptocurrency over the years. Cash App has offered bitcoin trading since 2018, and the company has held bitcoin on its own balance sheet since 2020, making the asset's price swings a recurring factor in its reported financials.

For the second quarter, Block's preliminary estimate for Cash App Bitcoin Ecosystem revenue stood at $1.8 billion. That figure primarily reflects the dollar value of bitcoin purchased by customers through Cash App.

The company also anticipated an $88.5 million accounting loss from revaluing its bitcoin investment at the asset's June 30 closing price. Block records this item below operating income, meaning it affects GAAP earnings only and does not alter the adjusted operating figures used to track the business.

Block noted that both bitcoin-related figures were preliminary and unaudited, and were not intended to represent the complete quarter. The company scheduled its full earnings report for August 5, 2026.

Cash App's bitcoin revenue can fluctuate significantly, as both the price of bitcoin and customer trading volumes vary over time. Similarly, accounting gains or losses on Block's own bitcoin holdings move with bitcoin's market price.

Cash App Drives Quarterly Performance as Banking, Lending, and Shopping Activity Expand

Cash App was the primary growth engine for the quarter. Its gross profit rose 31% year over year, while the Square seller business posted a 13% increase. Across Block as a whole, gross profit grew 25% compared to the same period last year.

The company reported a 27% adjusted operating income margin — its highest on record. Adjusted diluted earnings per share climbed 65% from a year earlier to reach a record $1.02.

User engagement within Cash App also strengthened. Primary Banking Actives grew 17%, and Cash App Commerce Enablement volume increased by the same percentage. Consumer lending originations surged 59%, with Cash App Borrow accounting for most of that growth.

Square's payment volume expanded across its merchant network. Total Square gross payment volume (GPV) grew 13% year over year. U.S. GPV rose 10% — the fastest domestic growth rate since the second quarter of 2023 — while international GPV increased 28%.

Block has also been reducing expenses. In February, the company announced plans to eliminate more than 50% of its workforce as part of a broader restructuring effort aimed at integrating artificial intelligence into more of its daily operations. The cuts place Block among several technology companies that have restructured staffing around AI deployment, though the scale of the reduction — affecting over half its headcount — is among the most aggressive in the sector.

"Intelligence tools are the next major technology shift, but machine learning is not new to Block," Dorsey wrote in a letter to shareholders.

Updated 2026 Guidance

For full-year 2026, Block now expects gross profit to increase 21%, adjusted operating income to grow 67%, and adjusted diluted earnings per share to rise 70%.

The earnings materials reference an appendix providing the company's definitions for key metrics including transacting active, Square GPV, Primary Banking Actives, Cash App Commerce Enablement Volume, and Cash App Consumer Lending Origination Volume. Block also included reconciliation tables connecting each non-GAAP figure in the presentation to its nearest GAAP equivalent.

Block's quarterly earnings reports are available on its investor relations website: investors.block.xyz.