Block’s Dorsey aims AI at rival vendors, banks

• Key insight: Block’s EPS grew more than 100% over the past year. 
• Expert quote: “Many of our sellers use a [third party system] to communicate with their staff, and we have introduced them to our tools.” —Jack Dorsey

Block made waves earlier this year by tying a massive downsizing to artificial intelligence. It’s now pushing the technology as a way for its merchant clients to jettison service providers while grabbing more banking share from consumers. 

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“We’re not just the wallet, we’re the entire bank,” CEO Jack Dorsey said during Block’s earnings call Tuesday evening. 

Dorsey laid out a series of recent or pending AI-supported tools that automate more services available through Block’s signature Cash P2P app while betting even the smallest merchants want AI agents to become de facto staff members.

“You would assume that smaller sellers aren’t up on this technology, but they are,” Dorsey said. 

Block’s earnings

For the quarter ending Sept. 30, Block reported gross profit of $3.24 billion, up 22% year over year. The payment fintech also posted earnings per share of $1.13, up 109% over the third quarter of 2025. Operating income was $428 million, up 14% over the prior year. Gross payment volume was $76.4 billion, up 14% over the prior year.

Block said it exceeded its third-quarter guidance across gross profit, adjusted operating income, and adjusted diluted EPS. Cash App reached 60 million monthly active users in September, while Square’s gross payment volume grew 14% to $76.4 billion. U.S. GPV growth was 10.4% and international GPV growth landed at 26%.

Block boosted its 2026 guidance to adjusted EPS of $4.15 versus $4.02, and its full-year gross profit outlook to $12.626 billion, up 22% over 2025. It adjusted its operating income guidance to $3.519 billion, which represents a 28% margin and 69% growth over the prior year. Investors have largely cheered Block’s financial performance since its downsizing in early 2026, with its stock up more than 10% on Wednesday morning and more than 20% over the past 12 months. 

“We see continued outperformance from Block as the company captures share in both [consumer and merchant divisions] demonstrating particular differentiation in the increasingly competitive merchant processing space,” William Blair analysts said in a research note.

In a separate matter, Block this week said it would pay $764 million under an agreement it reached with the Department of Justice in October to settle government claims that Block violated the Bank Secrecy Act over money laundering protections. 

Block’s agents

Block asserts that it can use AI to replace a number of its vendors, and enable its clients to do the same, Dorsey said. 

“Many of our sellers use a [third party system] to communicate with their staff, and we have introduced them to our tools,” Dorsey said. “This allows them to communicate and collaborate with their teams and build with AI agents as well.” 

Dorsey said AI agents can handle the “vendor side” of merchant tasks, such as product ordering, inventory management and updating supplies automatically based on volume trends. “The technology is very ready now, and it can take friction away from sellers,” he said.

Block has gone all-in on agentic AI over the past year, along with rivals such as Stripe, PayPal and banks that have also increased investment on new forms of machine learning. 

Block’s AI tools include “codename goose,” an agentic artificial intelligence framework designed to connect large language models to real-world tasks, enabling users to automate coding, data analysis, and product engineering. 

The company later deployed Builderbot, an internal AI assistant that evaluates proposed programming changes to support faster development. 

An additional AI product, Buzz, is a free, open source collaboration platform where humans and AI agents connect in a shared workspace. 

Buzz is probably the greatest manifestation of the “Block as Intelligence” vision, according to Dorsey, adding Buzz is an environment for building and collaborating that brings all of Block’s technology ideas together into one surface. 

Buzz is designed to scale and is “model agnostic,” according to Dorsey. 

“It’s entirely self-sovereign (meaning you can run it privately on your own network or system), and starts to reduce the dependency on tools like Slack, Discord, and GitHub,” Dorsey said in his letter to shareholders.

A pending product, Dessa, is a speech model that is designed to capture “emotion, nuance, pauses and a natural cadence” in an attempt to mimic human conversation. 

On the consumer side, Block’s Moneybot is an AI financial management assistant that helps Cash App users understand the links between saving, spending, and investing, and is considered one of Block’s primary revenue sources.

And while AI does not originate loans directly for Cash App Borrow, it assists users with spend management and budgeting — key inputs used to evaluate eligibility for alternative credit.

Block said it expects to have the initial monetization of AI tools in the fourth quarter, though the company is still working on its revenue model for AI-related tools, which it will base on feedback from users, according to Dorsey.

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“It is clear to us that Cash App engagement and monetization are on the rise,” William Blair analysts said, noting Block’s Neighborhoods feature that connects merchants to consumers “can be a powerful long-term consumer and merchant engagement driver with the ability to more closely tie together Block’s two ecosystems. We are encouraged that management is shifting focus to primary banking activities.”
Primary banking activities growth will power faster long-term BNPL and Borrow adoption, William Blair analysts said, resulting in ongoing monetization gains. “These are the primary gross profit growth levers and these areas underpin our mid-to-high-teens segment gross profit outlook,” William Blair analysts said.