Date
August 12, 2025
Category
Block Just Raised Guidance, and the Stock is Moving Higher
2025 hasn’t been a smooth ride for FinTech stock Block (XYZ). In February, it tanked after the company posted lower-than-expected profits for the fourth quarter of 2024. It then experienced another major fall in May on the back of a 2025 profit forecast cut.
The outlook for the stock – which was recently added to the S&P 500 index – appears to be improving, however. Because Block’s Q2 earnings1, posted after the closing bell on August 7, showed a healthy level of growth in profitability. And guidance for 2025 was raised due to strong performances from its flagship products, Cash App and Square.
Solid Q2 Earnings
For the second quarter, Block’s gross profit came in at $2,537 million, up 14% year on year. This was driven by 16% year-over-year growth in Cash App and 11% year-over-year growth in Square.
Adjusted operating income for the period was $550 million, up 22% year on year. Meanwhile, adjusted diluted earnings per share was $0.62 (versus $0.69 expected), compared to $0.47 in the prior-year period.
Full-Year Guidance Raised
On the back of this performance, the company increased its guidance for 2025. It now expects $10.17 billion in gross profit for the year (versus previous guidance of $9.96 billion), reflecting growth of over 14% year over year.
For the full year, it anticipates an adjusted operating margin of 20%. That would represent 2% margin expansion year over year.
Cash App Innovation
Zooming in on the Q2 earnings, the performance of Cash App is worth highlighting. Here, gross profit amounted to $1,501 million versus $1,299 million a year earlier.
This growth was driven by innovative features such as Cash App Borrow, Cash App Card, and BNPL. BNPL gross merchandise value (GMV), which now includes post-purchase BNPL on the Cash App Card, reached $9.11 billion in the quarter, growing 17%.
In its shareholder letter, Block said that with Cash App, it’s aiming to build the financial operating system for the next generation. It believes that by offering a scaled peer-to-peer (P2) network, a broad set of saving, investing, and borrowing tools, and the functionality to transact with Bitcoin, it can deliver a complete money hub and have success with younger generations.
It noted that in July, it rolled out “Pools” on Cash App after just four months of development. This feature enables customers to easily share group expenses, and the company believes it will help attract new customers.
Increased Price Targets for XYZ
It’s worth pointing out that since the Q2 earnings were posted, several brokerage firms have increased their price targets for XYZ stock including:
- JP Morgan: $100 from $90
- Needham: $100 from $80
- Jefferies: $95 from $90
- KBW: $95 from $80
- Raymond James: $95 from $79
- TD Cowen: $95 from $85
Given the bullish analyst sentiment here, Block could be a stock to watch in the second half of 2025.
Footnotes:
1 Block Q2 2025 Shareholder Letter, as of August 7, 2025
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