Block took a 31% hit to Bitcoin gross profit in Q2 2026 and came out ahead anyway. The Jack Dorsey-led fintech giant reported record adjusted operating income and bumped full-year gross profit guidance to $12.51 billion, despite the crypto-specific line item sliding down.
The reason is simple. Back in February, Block cut fees on Cash App's Bitcoin purchases. Transactions over $2,000 and recurring automated buys now cost nothing. Management bet that killing per-transaction margins would drive volume hard enough to offset the revenue loss.
The wager paid off. Cash App's Bitcoin ecosystem revenue hit $1.8 billion in Q2, fueled mostly by buy volume surging. Meanwhile, overall Cash App gross profit jumped 31% year-over-year. Block's total company gross profit grew 25% across the board, combining Square's merchant services with Cash App's consumer side.
The company is doubling down on infrastructure too. Cash App rolled out stablecoin payment options in May. Bitkey, Block's self-custody Bitcoin wallet, and Proto, its mining venture, push that same play deeper into the stack. Block continues reinvesting 10% of Bitcoin product gross profit straight back into BTC purchases.
For investors watching this unfold, two metrics matter. First, whether Cash App keeps ramping Bitcoin buy volume fast enough to hold ecosystem revenue up despite lower fees. Second, whether stablecoins gain real traction and start moving the needle on gross profit.
This article is informational only and should not be construed as financial advice or investment guidance.
