Block Investor Day 2025 - Q&A

All right, we have arrived at the last session of the day before the demo hall, which I'm personally very excited about. So, we have about 45 minutes or so to just answer your questions directly. So, we're going to have Jack, Amita, Owen, and Nick come back on the stage. I'll do my best to moderate from up here. We have a few mic runners running different parts of the auditorium. And so if you have a question, just raise your hand and we'll try and get to you. Start with Brian and then Tim. First two hands I saw. Oh, go ahead Jason.

First of all, thank you very much for a tremendous presentation. Really appreciate all the detail. And what I really wanted to ask big picture is just as we look at the guidance that you've laid out for 2026 as well as the subsequent couple of years, what do you see as just the biggest risks to these financial targets, putting the macro aside? And maybe as part of that, if you can talk about some of the embedded assumptions just around loan loss rates and any additional color on commerce enablement versus financial solutions versus Bitcoin in terms of the gross profit buildup. Thank you.

I can start on this. You know, the way we build our forecasts is we take the known trend lines in our business in very real time and extrapolate them based on obviously the history of data that we have across the multitude of products that we've got across our ecosystems. And we extrapolate them for the months and quarters ahead. We then overlay that with a portfolio of new initiatives, many of which we shared today, that we expect to launch in the weeks and months ahead. And then we probability weight that portfolio of initiatives as to when we expect that they would be released and how they would compound to growth in the future. And so that really is the exercise that underpins what we shared today. Specifically from a 2026 perspective, more of that growth, more of that weighting obviously is coming from the initiatives that we've already got in our portfolio and that we've been recently launching products, you know, like our Cash App Borrow product, Afterpay's integration with Cash App card, in particular the post-purchase integration which we've already scaled and will continue to scale, but also more net new product launches in the future like pre-purchase. And then with Square, what you'll see is the compounding growth of product innovation as well as go-to-market. Some of the exit rates that Nick talked about continuing into the future will be of course incredibly guided by our marginal returns as to how we invest in that and how we expect that those investments to deliver growth into the future. From a risk standpoint, a lot of it, of course, comes down to our ability to execute. Whether it's measuring returns on a weekly and monthly basis so that we ensure that our investments are appropriately calibrated to growth, or it's measuring loss rates for instance on our financial services products or lending products to ensure that we've got the right inputs around our expansion efforts there. You know, but what we see today, we're incredibly excited about what we think we can deliver in '26 and beyond.

Hey, Brian Bergen from TD Cowen. Thanks for all the detail. Nice job here. I wanted to dig in on the margin, maybe talk about the confidence in that margin outlook over the three-year period and particularly some of the key sources for you. I'm curious as you guys are also going full-on with Goose and Builderblock G2, how you think about what that means for you for needed workforce intensity in the company as well.

Sure. You know, there's a full gamut of costs that we can explain and I think it's different movers across our different cost categories. From a personnel standpoint, I think you've already seen us over the past few years get far more efficient. As we look ahead, you know, functionalizing our company, working against a consolidated Block roadmap together, being able to move people into squads so that they're working on the most high-priority initiatives. I think that gives us a tremendous amount of urgency and speed, but it also gives us efficiency in how we deploy our resources to deliver impact and the returns on our teams. I think we are still in the very, very early days of that. I think the second piece from a personnel standpoint is automation. We can enable our current employee base to deliver more and more, to see higher returns from our existing employee base, and to ramp in the mid-teens from a gross profit growth perspective without meaningful personnel investments above and beyond how we enable our team from an automation perspective. There's a number of other non-personnel cost categories from variable costs with sales and marketing and risk loss. These are big categories where we want to continue to refine and get more and more efficient but are mindful of investing there where we see strong returns to drive growth. And then there's a number of other non-personnel fixed categories which are, you know, real estate, software and cloud fees, professional consultant fees. That's a big body of spend and we are going to be fairly rigorous in how we scrutinize that spend to ensure that we can put more of our dollars in the categories that actually return for our customers. But we do intend to go all in on automating through Goose and all the tools that we build on top of it. And I would expect to be able to prove a lot more of that next year. But the number one priority for our company is to automate our company because if we can do that, we can do that for our sellers. We can do that for all of our customers. And we've already seen by investing in that we get entirely new product categories such as Moneybot and Manbot and everything around Builderbot as well. That acceleration will lead to things we're not talking about right now in terms of features and products as well. It just allows us to experiment much faster, build much faster, and get to product-market fit much faster.

We'll go to Tim next and then this question over here also.

Thank you. All right. Great. This question is more for Nick, I think. But you talked about 300 salespeople in seat by the end of 2027, I think it was, and it was you giving a lot of tools for them. So whether it's neighborhoods, the AI tools, you mentioned a stat today around 50% of the leads coming in are coming from the partners. So it's kind of supercharging these salespeople. So with that as a backdrop, I was hoping you could talk about the Salesforce productivity meaning for these 300 people. What should we be expecting in terms of their contribution, whether it's to the acceleration over the next few years or it's a per salesperson, or maybe if you can't go to that level, maybe just how does that productivity expectation compare to maybe the competitor salespeople?

Yeah. So my anticipation is that this field sales motion should be able to get to the same size of our existing telesales motion over the course of the next three years. Like that's the scale of the opportunity. And if we want to get to 50/50, field is going to be the primary driver of our ability to step-change the sales-led cohort. And we're already seeing very clear line of sight. We are working really closely with our development teams on how do we better automate the sales motion. I would still estimate that about 50% of a rep's time right now is spent on admin and not spent selling. So we have a huge amount of room to give time back to our reps to make them more productive and to be able to drive more NVA per rep while we scale the count of reps. From the field motion specifically, we are really early and the ROIs that we put up on the screen are reasonably primitive in a sense of like how we're steering our reps on where to go, when to go. So, for example, we don't presently have a best routing path of a day for a rep of where they should go and when. The reps are walking their local neighborhoods and we know their lists and yes the TAM's reasonably underpenetrated now so that works but there's a way to make them significantly more efficient than what they are doing right now. Our present Salesforce way of working is designed for someone sitting at their desk. It's not designed for someone on the move. So, how do we think about bringing that in where, you know, like if you walk into a store and you're trying to sell, you need to find the right moment that's at the right time when the person behind the counter has the space to listen to you or wants to commit to finding the space to listen to you. There's a lot more science that can be brought into how we show up in the field and our processes to date and our technology to date are not optimized for our field team, but we're really focused on making them optimized. So like the baseline of ROI in my mind is kind of like the starting point that gives us confidence, but I think we have a lot more room in finding efficiency of our reps and giving them better technology to help them automate and scale. And just one thing to add from a development perspective, we have dedicated teams that are partnering with some of the teams at Block that are a bit more operational in nature. So we have a dedicated development team that's working with sales and account management. Similar thing for customer operations, similar thing for risk operations and compliance operations. And so there's folks across engineering, design and product whose entire job is to look at that workflow for say field sales or say for account management and say how am I going to automate that? How am I going to get that 50% number down to 30%, 20%, 10%. And really excited about the progress we've made in the past few months.

Adam next, go to Darren.

Hi, Har with Bernstein. So two questions. First on Cash App monthly actives. As we look out into the coming years, Amita, you kind of guided to low single-digit growth. But my question is given all the paybacks you're seeing, we talked about that today, the product velocity, all the network and neighborhood initiatives, why not aim for a higher number than the low single-digit growth, fully recognizing that that number hasn't grown in the last couple of quarters. So this is an improvement and you may be kind of working off of the recent trend line. And then a follow-up, Amita, just on the guidance, the 17% gross profit growth guidance for next year, the 15% '27-'28, how should we think about that number including the variable cost, all of them including risk losses? Thank you.

Sure, I'll take the actives question. Appreciate the question. I guess one thing I just want to draw a distinction between is there's guidance and then there's setting a goal. So you can bet that our personal goal and what the team is aimed at delivering will mean, you know, we're trying to meaningfully outperform anything that we put out there from a guidance perspective. And I'm really, really happy with the progress that we've made. Basically this spring, we kind of said publicly that we're making network expansion the number one priority for Cash App. We've shipped a ton of improvements over the past several months and we're now starting to see that flow through. So, I talked about this a bit at earnings where we're seeing that year-over-year growth rate accelerate, obviously off of a low base and not a place that we're happy with, but we're seeing really positive trends. And I'm looking at numbers on a daily basis, on an hourly basis, and really happy with what I'm seeing. There's also other levers that are going to drive the business or we hope to drive the business that aren't necessarily factored in. I talked about network enhancements. I talked about teens and families. I talked about multiplayer money. Obviously, neighborhoods is a huge potential tailwind where you're talking about, you know, tens of thousands of points of sale and essentially making each of them an upsell into Cash App. There's entire new product lines that, you know, Brian Boats talked about the credit score, for instance. There's areas we didn't touch on today related to stablecoins, related to Cash for Business. So, I wouldn't read that as much as like a goal. I would read that more as guidance and I think we're working every single day to outperform.

And I'd also say on the actives front that as you, as I'm sure you see in your own model, Cash App gross profit is levered pretty strongly to actives growth. So if we can outperform that actives growth, we've obviously shown a track record of dramatically growing ARPU within Cash App. You know, the amount of utility that customers are finding on a daily basis across the ecosystem, how money moves through all of those products and the monetization rate on them has underpinned really dramatic growth from an ARPU perspective. And so to the extent that we can inflect the actives growth number, that will materially show up in gross profit. So I think what we've shown today is based on our most recent track record, the compounding results that we've seen over the past six months, but obviously there's a lot more to do there. And the second piece which is variable profit. I mean, I think what you saw in the presentation is obviously margin expansion not only in '26 but in the next three years. We also shared incremental profit margin expansion from '25 and into the next three years. We, as I said earlier, will tolerate risk loss growth on a dollar basis. And you'll see that show up in our P&L as we expand these lending products. But we're going to be incredibly watchful to ensure that the returns on that growth, the margin on originations, continues to be within our target levels. And so our ability to respond to any changes there and to profitably grow the unit economics on the individual lending products themselves continues to deliver over time. So I'd expect to see, you know, variable margins as well expanding in line with those broader rates.

All right, so we're going to go to Adam right here in the middle if you want to raise your hand. Then we'll go to Darren right next to him and I'll come up front for Hamish.

Thanks. Really nice job today presenting all this. I think you kind of created a bit of a clearing event in increasing the aperture of the visibility into the income statement, getting a little bit more away from just gross profit growth and expanding into the adjusted operating income line. Is the right way to look at this, given the headwinds, Nick, that you described a little bit on the Square side, more Salesforce-driven, higher merchants, which is a little bit lower margin, but you're driving a lot more operating income growth. And it looks like on the Cash App side maybe a little bit of the reverse, gross profit is growing a little bit faster than the contribution to the adjusted income growth. Is that the right way to think about it? But the building blocks are there on both sides of the business to drive even, to drive, I keep saying adjusted operating income growth. And then Nick, if you could just talk about your Salesforce adds and where they're coming from and what you're looking for as you build this group. Thank you.

So on the first part of the question if I understand it right, some of the incremental areas of growth, so for Square it's maybe larger sellers, international markets, and then for Cash App our lending products come at lower blended margins today than the core payments and software business. I think that's right. What we're seeing though is as we orient increasingly to variable profit dollars generated and we expect to grow that with discipline over time, we can see an overall blended profile across the mix of our products continue to deliver margin expansion. And that's accruing from a leverage standpoint as we strictly manage the fixed cost base. I hope that answered your question.

Yeah. And then, so yeah, I mean we think about this as dollar variable profit growth. Like that's the way ultimately the more dollar variable profit growth we can drive or acceleration of that year-on-year growth curve, the more that flows through into operating income. So when I'm looking at our opportunity, yes, we're like managing to a margin profile outcome because we don't just want to drive GPV for GPV's sake, but there are also some realities of how network effect is unlocked in a B2B business where people do respect certain people in their neighborhood, certain sellers in their neighborhood. There are staples and icons of neighborhoods that really shift the perception and then in partnership you can actually demystify some of the realities of what people might think of with Square through someone that they already respect. So when we're running a campaign with Katz's Deli or the founder of Bluestone Lane is on the front page of the F&B trade magazine talking about our hardware, that is a way better campaign for us than us running our own marketing campaign. I still, we're definitely not at the efficiency, like we're not maxed out on our efficiency frontier of our marketing spend in my mind. We want to keep pushing it as long as it's going to drive inbound lead volumes and quality inbound leads that go down to the bottom of funnel and translate to an actual closed win rate. But, you know, we have such a meaningful portion of our leads today come from our marketing spend. And as we keep pushing it, we're seeing that marginal profile prevail. So, you know, there's like, how do we keep driving the channels that will drive leads while we scale our team? Because if you scale your team and you have no leads, the inefficiency will start to show up and start to prevail. Field reps don't need leads. They need territories where you're underpenetrated where you know that if they run the right routes, you're going to achieve the right ROI outcomes with win rates. Telesales, some of our other teams, that's like enterprise, that's where we start to get more into kind of the lead routing piece. I do think international is a really interesting piece here. And I spoke about the different variable profit margin profiles of international versus the US business. But we're driving MVA growth of 70% at the moment. Like these are really big numbers. And I think we can keep pushing in that territory of growth rate if we play our cards right. So I'm really focused on field. I'm focused on starting to build the right upmarket motions. Some of our leadership from the early days of Afterpay is now leading those motions and starting to build that out on the Square side and then there are some newer things like reseller, scaling field and being really focused on international. The other thing I would add, Adam, is we talk a lot about payments pricing at market, but there's also a software opportunity that's pretty meaningful. And as we move up market, you attach more software. The pricing and packaging work that we launched at Square releases a month ago is also an opportunity to sell more software to our customers and help them run their businesses more effectively, which has a monetization benefit of course.

Darren, next it's Darren Pillar. This is probably more for Owen and for Jack, but you know, for some years now, we've talked quite a bit about the connection of the ecosystems being a big aspiration of the company. Cash App and Square. And I'd love to hear more tangible examples of what you think is actually going well today and more importantly what you see as potentially showing milestones of success in a year from today or two years from today that have said you would look back and say you really did succeed in connecting the ecosystems. To me that's one of the biggest potential differentiators of Block going forward.

I can just add a few thoughts. I really wanted to lay out kind of how we think about our capabilities and then our brands really just being interfaces on top of them at the start of my talk because I think it gets to your question. So I think there's already a number of ways in which we are and we have been connecting our ecosystems that's not necessarily incredibly visible to customers. And this was part of the goal around functionalization. So right now we have like a singular AI stack built on top of Goose and that agent substrate and that's powering Moneybot and that's powering Managerbot. It might not visibly feel to a customer like we're connecting the ecosystems but it's letting us move faster. It's letting us build incredible things in a matter of weeks or a matter of months. Similarly, we now have a singular financial platform across the entirety of Block versus, you know, having one for Square, having one for Cash App, so on and so forth. So, I think that we've made a lot of progress just in terms of our ability to move more quickly, our ability to get rid of duplication at the company. In terms of things that are going to really affect the customer experience and where you kind of get that combinatorial benefit that we've been talking about, I agree Neighborhoods is probably the biggest thing to watch in the immediate term. But really on the development side, what we're doing now as like one product development team is we're looking at every piece of Square, we're looking at every piece of Cash App, every piece of Afterpay, and we're saying, how can we provide differentiated value here? So there's a few other touch points that I would think about. One of them is obviously the integration of Cash App and Afterpay in the US. I think that's absolutely massive. So going back to the previous question, we're working toward having that tailwind of Cash App actives in terms of US Afterpay actives coming into Cash App. I think similarly we continue to focus on our payment stack with Cash App card and Cash App Pay. So the more payments that we can get at Square sellers with Cash App card and Cash App Pay, the better that we can make that experience both for consumers and for merchants. If you think about things like rewards or if you think about things like processing costs or what have you. That's why I think dollars on Lightning or Bitcoin transactions on USD was such a massive announcement to talk about today. And then I touched on it a bit in my talk, but I think the employee network and the staff network is a pretty meaningful opportunity here. Increasingly, you're seeing us build more and more features and products into Cash App that are broadening the aperture of Cash App into like basically whatever is related to your financial life, you should be able to manage it within Cash App. And so we have, you know, millions of staff members who work at small businesses on the Square side. We also see a very large number of new staff members on an annual basis. And to the extent that we can make Cash App just the default banking platform to get paid instantly for work that you do in a given hour or a given day, that's going to be pretty massive. But I guess more broadly I would say basically we're looking at every single capability and then how can we expose that to a given customer through a given interface and how can we add more value by leveraging capabilities across our brands.

Okay. So we're going to go to Hamish next who's a very front row and then Tingen after that.

Jack, maybe a question for you. One of the things you've hammered home is the importance of product velocity. And it feels like there's been a massive change there organizationally over the last couple of years. Where are you on that journey? Are you able to characterize that? And what more do you have to do to where you want to be?

Okay. Tension up here and then I'll go to Dan over here.

Thank you. Thanks, Matt. I guess I just want to share a couple reactions maybe to your session, Jack, if that's okay, and get your feedback on it. So, from a mission standpoint, the mission's always been pretty consistent, right? Economic empowerment. I think you shifted that to include autonomous economic empowerment if I heard that correctly. So that's one observation, big push towards autonomy. And then the second one when you talked about inflections, my reaction was that in the past most of these inflections were from established products and then you bring those to the mass markets or to the underserved. But I think the one that you called out, I think it was what, data and then AI. I would say those are less established, right? So I'm curious how this inflection might be different as you're moving the mission more towards autonomy. Is the market ready for autonomous tools? Is it ready for Bitcoin? How are you thinking about that within the framework of past inflections that have worked very well for the company? If you follow my question. And I know in the past, Jack, you've talked about Horizon 1, 2, 3. I don't know if that thinking applies here or not. Sorry for the long-winded question.

Just one quick add-on from a product perspective. I think we've done a good job on the Square side and Cash App side of just obfuscating away from the complexity. And so you had a question about readiness. I think the question is like, I believe there's some customers who perhaps don't care that let's say Moneybot is running on let's say GPT 5.1 versus Claude Sonnet 4.5 versus an open source model. What they care about is that they're able to save up a rainy day fund or they're able to get good financial advice from Moneybot. I think similarly you don't necessarily have to believe that tens of millions of customers are going to actively choose to pay in Bitcoin tomorrow or next month. We can obfuscate a lot of this complexity. What they care about is that their transaction goes through for their coffee and what sellers care about is the transaction goes through and also maybe I'm paying less. So, it's our job as a design and engineering company to obfuscate away a lot of the stuff that we're talking about here and just build incredibly simple experiences that customers love. And I think that's more so what we're getting at.

So, I'll go to Dan over here and then question on the back bench back there.