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Macroeconomic uncertainty and an overreliance on Cash App led the company to slash its full-year guidance

The newly rebranded 鈥淐补蝉丑 App Afterpay鈥� will help Block more tightly integrate its products into one ecosystem

Cash App launched a national marketing campaign highlighting its new banking products.

The service advances Block鈥檚 goal of 鈥渂anking our base鈥� and could drive Cash App adoption.

Ramping up marketing spend and integrating Cash App, Afterpay, and Square should put it in a stronger position in 2025

Square Loans, Cash App Borrow, and Afterpay were all bright spots that should yield longer-term growth

Block has been working to grow Cash App Pay, but the buy button still trails competitors

As younger generations use the P2P app for more of their banking needs, it鈥檚 still missing key financial services.

It wants to offer banking services to its four million Square sellers and the 54.9 million people we forecast will use Cash App this year. To that end, Cash App received FDIC approval in March to finance its Cash App Borrow loans directly to consumers through Square Financial Services鈥攁 crucial step toward launching larger lending operations.

The news: Block highlighted the success of using alternative underwriting to expand access to credit through Square Loans, Cash App Borrow, and Afterpay. Block evaluates users鈥� regular paycheck deposits, bill payment consistency, cash flow patterns, and spending habits. Square Loans also factors in business performance.

Why this matters: 蘑菇AV 63% of Gen Z credit card users have switched to another payment method, per Cash App Afterpay. Gen Zers are trading down to debit cards or other alternatives like buy now, pay later (BNPL), potentially eroding payments volume, swipe fee revenues, and interest income for issuers.

In comparison, Block鈥檚 Cash App disappointed in Q1: Slowing inflows contributed to growth that CEO Jack Dorsey said 鈥渄oes not meet our bar.鈥� Venmo鈥檚 recent rollouts could help widen the lead it holds over Cash App. Buzzy campaign ad: To promote Venmo鈥檚 widening capabilities and rewards, the company enlisted Aimee Lou Wood and Patrick Schwarzenegger as brand ambassadors for 鈥淰enmo Everything.鈥�.

The rule mandates that financial institutions (FIs), credit issuers, and payment apps like Venmo and Cash App must transfer consumer financial information to other providers for free at the consumer鈥檚 request. As it stands, large FIs with over $850 million in assets must comply with the rule by 2026. Smaller institutions have until 2030.

Block began letting Cash App customers check out with Afterpay on partner merchant sites earlier this month. And also this month, Cash App received FDIC approval to finance Cash App Borrow loans directly to consumers through Square Financial Services.

Most recently, Block launched a feature that lets Square merchants transfer 1%-10% of their daily sales to their Cash App account for conversion into Bitcoin. Block also owns Bitkey, a Bitcoin wallet; Proto, a collection of Bitcoin mining products and services; and Spiral, a funding engine for open-source projects that utilize Bitcoin for 鈥渆conomic empowerment.鈥�.

Targets Gen Z through small-dollar loans (Cash App Borrow) and Buy Now, Pay Later (Afterpay). Appeals to underserved teens and families, with an average loan size under $100. Gained FDIC approval to originate loans, expanding its lending capabilities. SoFi鈥檚 partnership with Nova Credit:.

Cash App. Visa. Apple Pay. Venmo. Key takeaways: Gen Alpha鈥檚 preference for digital competitors likely means these payment apps provide the banking basics Gen Alpha needs at this stage. And that includes the ability to buy what they want, pay and receive money from friends and family, and save some money. They may not be interested in more complex banking services at this time in their lives.

Apple Cash Family lets parents load money into their children鈥檚 accounts and limit who they can send money to. Apple Card also has a family feature. Cash App lets teens make P2P payments and apply for its debit card with parental supervision. And Venmo鈥檚 Teen Account comes with a linked debit card.

Robinhood is planning a cash-delivery service. Cash App launched a marketing campaign that highlights its attractive new banking products. Chime lowered the barriers for personal loans. Revolut鈥檚 new ATMs could take a swipe at a major competitive advantage held by traditional financial institutions (FIs).

Between buy now, pay later (BNPL) players like Affirm and mobile wallets like Cash App and PayPal, the number of fintech cards on the market is growing. Affirm Card gross merchandise volume (GMV) jumped 113% YoY in the quarter ending December 31, 2024. And the number of active Cash App cardholders increased by 1 million in 2024.

Surging Cash App user growth helped drive a buoyant Q1 for Block despite recent short seller allegations.

The app鈥檚 expanding product suite could appeal to this group. But they won鈥檛 be an easy sell, and Block risks becoming over-reliant on Cash App.

Mine is that Cash App is, it's not really a number, it's more of a data point, so I hope that's okay. Rob Rubin (05:10):. All right. Grace Broadbent (05:20):. Cash App is Gen Z's second-highest ranked bank in terms of consumer banking satisfaction scores. The only bank that ranks higher than cash app is Bank of America.