Block Q3 gross profit rose 22% to $3.24 billion, beating expectations, and shares surged over 7% in after-hours trading.

November 4 - According to Bloomberg, Jack Dorsey's payment company Block reported a 22% year-over-year increase in third-quarter gross profit to $3.24 billion, exceeding the average analyst estimate of $3.1 billion. The company raised its full-year 2026 gross profit forecast from approximately $12.5 billion to approximately $12.6 billion, and its stock rose more than 7% in after-hours trading.

In terms of business, Square is expanding into restaurant merchants, while Cash App is rolling out more bank account-like features. Block is also connecting Cash App users with Square merchants through the Neighborhoods project and has begun selling some internally developed AI tools. Despite previously announced layoffs, the company's third-quarter operating expenses still reached $2.8 billion, rising both year-over-year and quarter-over-quarter.

Additionally, Block disclosed that it recorded approximately $230 million in bitcoin investment losses in the third quarter. Its bitcoin business primarily provides customers with trading channels, and related performance fluctuates with bitcoin prices.

Block expects fourth-quarter gross profit of $3.32 billion and 2027 gross profit of $14.52 billion, representing 15% year-over-year growth. Owen Jennings, the company's business head, said Block expects to generate revenue directly from AI tools for the first time in the fourth quarter and anticipates that AI investments will drive subsequent growth.

Block also disclosed that it has reached an agreement in principle with the U.S. Department of Justice regarding a multi-year anti-money laundering investigation. The proposed deferred prosecution agreement involves a total amount of approximately $964 million, and Block expects a net payment of approximately $764 million, higher than the $526 million reserve disclosed in the previous quarter. The agreement still requires court approval.