Earnings Call Transcript - XYZ Q2 2025

Operator, Operator

Good day, ladies and gentlemen, and welcome to the Block Second Quarter 2025 Earnings Conference Call. Today's call will be 45 minutes. I would now like to turn the call over to your host, Matt Ross, Head of Investor Relations. Please go ahead.

Matthew Ross, Head of Investor Relations

Hi, everyone. Thanks for joining our second quarter 2025 earnings call. We have Jack and Amrita with us today. We will begin this call with some short remarks before opening the call directly to your questions. During Q&A, we will take questions from conference call participants. We would also like to remind everyone that we will be making forward-looking statements on this call. All statements other than statements of historical fact could be deemed to be forward-looking. These forward-looking statements include discussions of our outlook, strategy, and guidance as well as our long-term targets and goals. These statements are subject to risks and uncertainties, including changes in macroeconomic conditions. Actual results could differ materially from those contemplated by our forward-looking statements. Reported results should not be considered an indication of future performance. Please take a look at our filings with the SEC for a discussion of the factors that could cause our results to differ. Also note that the forward-looking statements, including earnings guidance for 2025 discussed on this call, are based on information available to us and assumptions we believe are reasonable as of today's date. We disclaim any obligation to update any forward-looking statements, except as required by law. Further, any discussion during this call of our lending and banking products refer to products that are offered through Square Financial Services or our bank partners. Within these remarks, we will also discuss metrics related to our investment framework, including Rule of 40. With Rule of 40, we are evaluating the sum of our gross profit growth and adjusted operating income margin. Also, we will discuss certain non-GAAP financial measures during this call. Reconciliations to the most directly comparable GAAP financial measures are provided in the shareholder letter and our historical financial information spreadsheet on our Investor Relations website. These non-GAAP measures are not intended to be a substitute for our GAAP results. Finally, this call in its entirety is being audio webcast on our Investor Relations website. An audio replay of this call and the transcript for Jack and Amrita's opening remarks will be available on our website shortly. With that, I'd like to turn the call over to Jack.

Jack Dorsey, CEO

Thank you all for joining us. As you all know, we've been talking for several quarters about our focus on increasing product velocity and ramping up our go-to-market investment. This quarter, you can see our work paying off. We're back to growth mode across the company. We're shipping faster. We're launching new features like Pools in just a few months, and we're accelerating the pace of delivering AI functionality to our customers. In my letter this quarter, I discussed Cash App's scale and impact and our strategy to continue growing by helping our customers manage their financial lives better. We believe the capabilities in Cash App are unique and that no one else can deliver the money app we're building for consumers. I hope you take a look. And with that, I'll turn it over to Amrita.

Amrita Ahuja, CFO

Thanks, Jack. We delivered strong results in the second quarter, exceeding our gross profit and adjusted operating income guidance. Gross profit was $2.5 billion, up 14% year-over-year, accelerating from 9% growth last quarter. Adjusted operating income was $550 million, up 38% year-over-year, as we expanded margins to our highest quarterly adjusted OI margin yet, 22%. Product innovation and go-to-market investments are accelerating across Block. We're delivering more value faster and more efficiently. In the second quarter alone, we launched Square AI, Square Handheld and an updated version of Square Online. We showcased Bitcoin payments on Square, introduced Tap to Pay for Cash App Business powered by Square and rolled out Cashbot, our AI-powered customer support agent. We released paying monthly for Afterpay single-use payments in the U.S.; new features for sponsored accounts; a new, more personalized offers platform; and we took Cash App Pools from development to pilot in just a few months. In Cash App, gross profit growth re-accelerated to 16% year-over-year in the second quarter. Cash App Card delivered healthy gross profit growth at scale, and BNPL gross profit re-accelerated, driven in part by the increasing attach rates for post-purchase BNPL on Cash App Card, which crossed 1 million monthly actives in July. We began to meaningfully ramp Borrow on Square Financial Services during the second quarter. Our bank, SFS, now originates the majority of Borrow loans for our customers, and we plan to continue expanding SFS originations throughout the second half of the year. We're also exploring more ways to deepen engagement, including higher Borrow limits for paycheck deposit actives. We believe the combination of assets we have in Cash App is unique and positions us for attractive sustainable long-term growth as an enduring ecosystem. Our strategy is oriented around driving strength in the 4 pillars of our business. First, we have a scaled peer-to-peer network that drives community connection and Cash App customer acquisition with $218 billion in peer-to-peer volume in the last 12 months. Second, our broad commerce capabilities generated $183 billion in volume in the last 12 months, growing 16% year-over-year or 21% excluding Cash App Business. Third, our banking solutions help millions manage their money. In June, 8 million actives either deposited a paycheck or spent at least $500 across Cash App, and Borrow reached $18 billion in annualized originations. And fourth, we've enabled millions of actives to buy and sell $58 billion in Bitcoin. For paycheck deposit actives who receive some of their paycheck in Bitcoin, we provide what we believe is the only way to buy Bitcoin with no fees and no spread. Cash App is resonating with the next generation at scale. In June, we had 5 million sponsored teen actives and 1.7 million actives that had graduated from a sponsored account to an individual Cash App account. Engagement with sponsored teen actives is strong with nearly 80% attach rate to Cash App Card and over 25% attach rate to Cash App Pay. Simply put, Cash App meets the needs of this generation and delivers tools to help them run their financial lives. Turning to Square. Year-over-year GPV growth accelerated to 10% in the second quarter, and we delivered 11% gross profit growth, which included a network remediation payment we had previously discussed at the end of last year. We observed strong GPV growth in food and beverage, and retail, up 15% and 10%, respectively. International GPV growth accelerated to 25% year-over-year as we continued to expand distribution across sales and partnerships. We are changing perceptions of Square among new and existing customers, a testament to the products we've launched in the past year and the investments we're making across marketing, field sales and partnerships. We're focused on winning the quick-serve restaurant market, and we're delivering with customer wins like Colectivo Coffee; Shane's Rib Shack; and Ben's Soft Pretzels, a 60-location seller that we're thrilled to welcome back to Square. These amazing sellers are category leaders in their communities, and we're honored they choose to partner with us. Beyond winning QSR, we continue to see strong performance from our field sales team with an estimated 5- to 6-quarter payback on recent sales cohorts. In the second quarter, we delivered our highest ever new volume added and our strongest growth in new volume added since the third quarter of 2021. Year-to-date, forecasted new gross profit added outpaced forecasted new GPV added as we grew upmarket in the U.S., signaling healthy pricing and product attach rates. We continue to see high ROIs as we scale field sales, and we expect to continue to ramp sales personnel aggressively to broaden our distribution footprint further. We're also seeing early traction with our independent sales organization investments and expect to continue to scale that distribution channel further in the quarters ahead. Turning to guidance. We're raising our full-year guidance and our expectations for the back half of the year. Our Q3 guidance and implied Q4 guidance call for continued acceleration in gross profit growth. For Q3, we expect gross profit of $2.6 billion, growing 16% year-over-year. We expect adjusted operating income of $460 million or 18% margin. We expect to exit the year with gross profit growth of 19% and over 20% adjusted operating income margin, positioning us well for 2026. As we look at Q3, there are 2 nuances to call out. First, we expect to see an adjusted operating income margin of 18% in the third quarter compared to 20% plus margins in the other quarters this year. This is due primarily to risk loss growth as we expand Borrow. We are investing behind a product that has strong unit economics on incremental growth, and we expect loss rates to stay within historical ranges. The timing of our expanded go-to-market initiatives also contributes to Q3 margin dynamics. Second, for Square, we expect to deliver low double-digit GPV growth in the third and fourth quarters, accelerating modestly from the 10% growth we delivered in the second quarter. We expect third quarter gross profit in the high single-digit range and fourth quarter growth to track roughly in line with GPV growth. Square's third-quarter gross profit growth is impacted by a few dynamics, including our decision to increase operational flexibility at a processing partner, which modestly increases processing costs and further investments in hardware as a successful go-to-market driver for Square. We continue to be encouraged by the strong results we see in our go-to-market efforts for Square with profitable volume growth and a return to share gains in recent quarters. For the full year, we're raising gross profit and adjusted operating income guidance to reflect our strong execution. We expect full-year gross profit of $10.17 billion or over 14% year-over-year growth. We expect adjusted operating income of $2.03 billion or 20% margin, expanding margins 2 percentage points year-over-year despite the meaningful go-to-market investments we're making to grow our business. Our financial results and our updated guidance are a reflection of our ability to deliver value to our customers. We're honored to have been added to the S&P 500 this quarter, and we want to welcome new investors joining us on this journey. We believe we have the best combination of assets in the industry to deliver on our purpose of economic empowerment. And we're excited to share more about our long-term road map at our Investor Day on November 19. I'll now turn it back to the operator to start the Q&A portion of the call.

Operator, Operator

Your first question comes from the line of Tien-Tsin Huang from JPMorgan.

Tien-Tsin Huang, Analyst

Really impressive growth here in the quarter and the outlook. So I just want to maybe check on conviction and visibility, of course, into the second half acceleration that you're talking about. I think, Jack, you mentioned you're shipping product faster. So given what you've seen and observed, I'm curious, are you more bullish in certain areas versus what we last talked about? And where might you be a little bit more cautious with more work to do than, say, 90 days ago?

Jack Dorsey, CEO

I believe our shipping speed is a key factor in this. A significant example of this is our recent Pools launch. This feature is quite complex to implement on the network, but our team excelled by moving from ideation to execution and shipping to customers in just three months. Additionally, it allows us to reach users outside of our network, enabling them to create pools and invite friends who don't currently use Cash App to contribute via Apple Pay or Google Pay. This functionality is designed to showcase our utility and encourage new sign-ups. We are now able to introduce such features much more rapidly, which directly enhances our overall network growth and increases our virality. This strengthens the network effect that defines Cash App, allowing us to build more robust products on top of it. We are committed to demonstrating everything Cash App has to offer within the ecosystem. I have never felt more confident in our ability to achieve this, thanks to our focus and the advanced AI coding tools at our disposal. Goose, for instance, is widely adopted within the company, boosting our developers and designers' productivity. It enables us to experiment at minimal cost, leading to quicker responses and faster customer feedback, allowing us to hone in on what resonates with users. I am very excited and optimistic about our capacity to accelerate our shipping process, which will enhance the overall experience of both Cash App and Square.

Amrita Ahuja, CFO

Yes. I would like to add that in the second quarter, we observed several positive indicators that provide us with confidence regarding our growth-driving products, which we believe will enhance our performance in the latter half of the year. This realization led us to increase our guidance beyond the second quarter results, anticipating growth in both gross profit and operating income. Our forecast includes a two-point sequential acceleration into the third quarter and a further three-point increase into the fourth quarter, based on four significant factors that we witnessed in the second quarter. First, Borrow is performing strongly, with 6 million monthly active users. We're responsibly expanding eligibility and increasing limits while maintaining healthy loss rates, and we're experiencing improved unit economics as we transition from a partner bank to our own bank, SFS. Second, in Cash App, newer products like post-purchase Buy Now Pay Later on Cash App Card are beginning to resonate, marking the integration of Afterpay into Cash App. This feature has already surpassed 1 million active users as of July, and we are encouraged by its growth. When comparing post-purchase BNPL to Borrow at similar stages, it is outperforming in attachment and loss rates, with Cash App Pay reaching 7 million monthly active users as of June. The third key factor is Proto; we will share more at next week's launch event, but we anticipate that Proto will start contributing to our gross profit growth in the latter half of the year. Lastly, the Square business is showing encouraging acceleration, and we expect to conclude the year in the fourth quarter with quicker growth in gross payment volume, which will contribute to our gross profit growth over time.

Operator, Operator

Your next question comes from the line of Tim Chiodo from UBS.

Timothy Edward Chiodo, Analyst

I want to dig in a little bit more on Cash Card post-purchase BNPL. So this topic comes up a lot because investors are now very confident in the ramp in Borrow in the second half and the lapping dynamics, those are supportive of gross profit growth heading into at least the first half of 2026 as well. So we're often asked what's the next big product that can help drive the growth in the second half of 2026 and beyond? Of course, there's a long list of items, and many of them are highlighted in the shareholder letter. But one that stands out is Cash Card post-purchase BNPL. You just mentioned some of the stats, the 1 million, the attach rates, the loss rates. I was hoping you could just elaborate a little bit more on this product in terms of those attach rates and just anything else that can help us to better quantify that opportunity in 2026 and beyond.

Amrita Ahuja, CFO

Sure. Thanks for the question, Tim. So we released the product in March, and it's been one of the key drivers of growth acceleration for Cash App and also what you saw overall for the BNPL platform. If you look across the second quarter, GMV for BNPL accelerated to 17% on a reported basis, 18% constant currency, up from 13% and 16%, respectively, in the first quarter. We also saw gross profit accelerate to 22% year-over-year growth, so part of an accelerating story for BNPL overall. The early signs that we've seen for post-purchase BNPL have been really strong, strong conversion, strong adoption. As I mentioned, we crossed the 1 million monthly actives mark. We also crossed the $2 billion originations run rate mark in July and expect to continue to expand eligibility and increase attach rates as we look at the back half of the year. As I noted earlier, we're really taking the learnings from Borrow. And as we stack up post-purchase BNPL against Borrow's early trajectory, both in terms of origination volume and margin profile, because we're able to leverage our infrastructure around the Cash App credit score, we've been able to track ahead of where Borrow is and we know that that's become a successful product for us. So we're encouraged about these early signs that we're seeing on BNPL. If I step back and if I think about 2026, obviously, we'll have a lot more to say later in the year and at Investor Day. But I think about the nascent products that are still ramping, like post-purchase BNPL, which we'd expect to contribute more in '26. Our traditional Pay-in-Four bringing that more into Cash App and seeing that ramp into '26 Cash App Pay, some of the newer products that we've talked about like Tap to Pay on Cash for Business, all these newer products continuing to ramp at the end of 2026 for Cash App. I'd expect Borrow to continue to be a growth driver for us as well. It's not just about the back half of this year. And there's also, as we look ahead into 2026, compounding effects of these go-to-market investments we're making across each of Cash App and Square. So there are a number of drivers of growth as we look at '26 that we get excited about. And then most importantly, the key takeaways from this call, as you heard from Jack, is really around product velocity increasing, and so there's even more coming than what we have today.

Operator, Operator

Your next question comes from the line of Darrin Peller from Wolfe Research.

Darrin David Peller, Analyst

Great job. I have one more question about Cash App. It clearly performed strongly and saw significant acceleration. Borrowing was robust with $18 billion in originations. I appreciate the new information you provided. I noticed there are 8 million banking actives defined as either 2.5 million or 2.7 million direct deposit users, or anyone spending $500 per month on Cash App. That figure increased by 16%. Could you elaborate on that metric? It's a new disclosure that I haven't seen before. How do you expect that to trend and influence Cash App's gross profit even into next year if we're considering it correctly? Also, I want to highlight the new areas for potential monthly active user growth on Cash App. How has that been trending as well?

Amrita Ahuja, CFO

Darrin, I can start on this. Firstly, what I want to highlight is that we've seen strong growth in paycheck deposit actives, reaching 2.7 million reported in June. We added another 100,000 in July, bringing us over 2.8 million, demonstrating continued growth. Through extensive research to shape our banking strategy, including considerations for incentives and marketing to our customer base, we found that more individuals view Cash App as their primary banking partner than those counted in our paycheck deposit active metric. This insight led us to analyze inflows, spending patterns, and transaction metrics to better understand Cash App usage. From this analysis, we introduced new metrics, notably establishing a $500 monthly spend threshold as an indicator of a banking relationship. This is significant, considering the average debit card spending in the U.S. is around $900 a month, which suggests that users are largely prioritizing Cash App Card for their spending. Additionally, the average revenue per user of these 8 million banking actives, who either deposit a paycheck or spend $500, is growing rapidly at 16% year-over-year. Moreover, they are highly engaged, generating over $250 in gross profit per active on an annualized basis in the second quarter, which is three times Cash App's blended $87 average revenue per user. On average, they conducted over 40 transactions across Cash App in June. We are encouraged by our progress with our banking strategy and recognize that millions trust Cash App as their banking platform. We plan to implement more initiatives, including testing higher borrowing limits for paycheck deposit actives and expanding banking benefits based on spending thresholds, to enhance awareness and incentives for our banking platform.

Operator, Operator

Your next question comes from the line of Rayna Kumar from Oppenheimer.

Rayna Kumar, Analyst

Last year, you started to lean a bit more into a Square sales effort. And of course, you've launched a number of new products. Can you talk a little bit about some of the returns you're seeing on these investments and if it's scaling as you expected?

Amrita Ahuja, CFO

Yes, we're very excited about the early results of our expanded go-to-market strategy. We're reaching a much broader group of sellers now, which is beginning to translate into gains in market share. Particularly from a sales standpoint, we're experiencing strong growth in the first half of this year with over 20% growth in new volume. We anticipate that this growth will more than double in the fourth quarter due to our ramping up of the sales team in both field sales and telesales. In field sales, which is a newer area for us, we are seeing an excellent return on investment, indicated by strong lifetime value to customer acquisition cost ratios and paybacks in the 5- to 6-quarter timeframe. This confidence leads us to continue expanding both our field sales and telesales teams in the U.S. and internationally. The returns from these new hires have been very favorable, reinforcing our commitment to invest further. The combined sales approach alongside our partner initiatives has been successful, surpassing our expectations for partner-driven leads in the second quarter and tapping into new growth channels with our initial U.S. ISO partnerships. Additionally, we are witnessing robust growth from our international markets, with 25% growth in gross payment volume and 19% growth in gross profit in the second quarter, reflecting the benefits of our on-the-ground investments in sales. Lastly, while we're seeing significant growth driven by field sales, telesales, and partnerships, our self-onboarding process remains strong, consistently generating healthy volumes.

Operator, Operator

Your next question comes from the line of Trevor Williams from Jefferies.

Trevor Ellis Williams, Analyst

I wanted to go back to the spread between gross profit and GPV growth in Square. That was a bit narrower than where it was in the first quarter. If you could talk through some of the moving pieces there, I think you had pricing that went in at the end of March, the network incentives Amrita mentioned, just what the offsets to those were? And then for the rest of the year, it sounded like gross profit, a bit below GPV in Q3 and in line in Q4. Just the moving pieces within those 2 quarters and if longer term, we should be thinking about a pretty tight spread between those 2 growth rates.

Amrita Ahuja, CFO

The main factor impacting Square's gross profit is a few subtle near-term dynamics that do not reflect the true strength of the business. Our focus remains on compounding sustainable GPV growth, which will contribute to gross profit growth. One significant aspect is that the new profit from recent customer cohorts is even stronger than the new volume generated in the U.S. This indicates that our pricing and the addition of extra products within our ecosystem are performing well as we onboard these customers, and this trend is expected to continue as we move into 2026 and beyond. In the near term, there are a couple of important factors to highlight. As mentioned earlier, we made some adjustments to enhance our operational flexibility with a processing partner, which slightly raised Square's processing costs. As a result, in the second quarter, we faced about 2 points of gross profit growth headwind from this change, effectively offsetting the network remediation payment we discussed earlier. We anticipate this will also affect the third quarter but expect to move past it as we approach 2026. Another important point is the costs associated with hardware. Our newer handheld devices have seen strong adoption and continue to be a valuable avenue for acquiring new customers. We intend to capitalized on this opportunity as we integrate more customers onto our platform. Overall, we expect gross profit and GPV growth to align by the year's end and will consistently aim to cross-sell more products to help our customers operate and expand their businesses.

Operator, Operator

Your next question comes from the line of Harshita Rawat from Bernstein.

Harshita Rawat, Analyst

I want to ask about Cash App user growth. Jack, you mentioned focusing more on network density, particularly with families and teens, and it’s great to see products like Pools introduced this quarter. You've also implemented some marketing campaigns. My question is what other strategies can you employ to grow the network and user base at Cash App, especially considering that growth has stalled in recent quarters. Additionally, I would like a quick follow-up regarding any comments on Bitcoin mining initiatives in light of the recent deal with CoreWeave and Core Scientific.

Jack Dorsey, CEO

I'll start with Proto and mining. We have some exciting news coming very soon, potentially as early as next week. We're really enthusiastic about everything happening with Proto. We've developed what we believe is the best miner available, and the market is about to recognize that. Our miner will offer the most flexibility and customization, designed entirely with customer feedback in mind. We expect to have very satisfied customers, which will help us expand our market presence and capture significant market share in mining. Regarding Cash App, we are closely analyzing our existing and future customer base and believe we are creating the money app for the next generation, presenting a significant opportunity as this space is relatively underexplored. There are not many competitors excelling in this area. Cash App connects well with younger users; it's appealing, effective, and user-friendly, providing all the necessary features. Many parents are introducing their children to it early on, and we plan to leverage this dynamic by making our app even cooler and more user-friendly. Our new feature, Pools, stems from understanding how people manage their money collaboratively. An impressive statistic is that 60% of adults in the U.S. pool money for various purposes. We aim to create a seamless experience that allows users to contribute to a pool without needing to sign up for Cash App immediately; they can utilize Apple Pay or Google Pay instead and later see the full benefits of Cash App, prompting them to register. We are deeply attuned to our customers and future users, which shapes our product development and marketing strategies. Our marketing efforts are exceptionally creative, and we anticipate them only becoming stronger throughout the year. The volume of features and products we are set to launch this year surpasses anything we've accomplished previously, thanks to our available technology and the focus from our recent organizational restructuring. Things are finally falling into place, and we’re observing positive results. The team is highly motivated to deliver outstanding products to our customers. We are exploring a variety of innovative ideas, reminiscent of our early days with Cash App, when we tackled seemingly impossible tasks but made them a reality in a compelling way. This concentrated effort will yield returns. The era of not launching new products is behind us; our effectiveness is directly related to how swiftly we can release new offerings, test ideas, and engage with our customers, and our pace has never been faster.

Amrita Ahuja, CFO

I'd like to add that what we're observing aligns with what Jack mentioned. We recently launched initiatives such as Cash App Pools, which we are ramping up for more customers, and Tap to Pay for Cash App Business, also launched recently. Our marketing campaign has been quite engaging and innovative, targeting the next generation over the past few months. Our execution is accelerating, and these developments are relatively recent. Although the early indicators may not fully appear in the 2Q results, they have been very encouraging in terms of active engagement metrics. We are seeing initial signs of success in revitalizing network growth for Cash App, and we anticipate these results will become clearer as we approach 2026. This is part of the confidence we had in raising guidance for the latter half of the year, based on the recent product and go-to-market strategies for Cash App.

Operator, Operator

Your next question comes from the line of Dan Dolev from Mizuho.

Dan Dolev, Analyst

Really good results. Great job on growing everything, including the Borrow product. I do have a question. We're getting a lot of inbounds on it this afternoon on this topic. So I did want to understand a little bit better how the Borrow thing is evolving as it gets bigger as part of the business. Maybe, Amrita, can you opine on the gross margin profile in terms of like what percent is it? Is it 100%? And maybe touch on quantifying the puts and takes on the step-up in losses, again, because we're getting a lot of questions about this. But overall, great job on growing this and making it a big business.

Amrita Ahuja, CFO

Happy to discuss Borrow further. The performance this quarter has been very strong. Origination volumes nearly doubled year-over-year to $18 billion on an annualized basis in the second quarter, and we reached 6 million monthly active users in June. We anticipate this strength will continue as we expand Borrow to more states under the SFS originations. I encourage you to review our investor slides, which show our annualized net margin, a key metric for measuring the product's success and its unit economics. We observed strong economics with 24% margins in the second quarter, surpassing our 20% margin threshold, and we've seen multiple quarters in the mid-20% range even as we ramp up Borrow significantly. We view Borrow not only as a solid product by itself but also as an essential component of our engagement strategy for Cash App banking. Our customers greatly appreciate quick access to liquidity, so we plan to test higher Borrow limits for our paycheck deposit actives and explore other methods to enhance engagement using Borrow within Cash App. Regarding losses, the core asset we leverage for Borrow and post-purchase on BNPL for Cash App Card is our internal credit score. This unique credit scoring system uses data from our customers' Cash App usage to inform underwriting decisions and eligibility. It is continually updated and absorbs data across our ecosystem to determine customer underwriting potential and credit limits. Our recent white paper discusses this in detail. Our internal credit model can approve 38% more customers than VantageScore while maintaining the same loss threshold, allowing us to better serve those who are typically excluded or underserved by traditional financial systems. We're excited about Borrow's capabilities while keeping loss rates around 3% or less, along with strong unit economics.

Operator, Operator

Your next question comes from the line of Matthew O'Neill from FT Partners.

Matthew Casey O'Neill, Analyst

I just wanted to drill in and hear some early observations, particularly around the rollout of new hardware and seller, notably the Handheld. Curious if you're seeing anything around TAM expansion, win rates, improved retention or anything else that would be good to share here.

Jack Dorsey, CEO

We are really excited about Square Handheld; it’s our best design yet. We’ve incorporated a lot of customer feedback to create a product that’s highly portable, affordable, and very durable. What’s particularly interesting is its versatility; it can be used across various types of commerce, not just in restaurants, but also in retail and service settings. We launched it in the U.S. in Q2 and are currently rolling it out internationally. The hardware has traditionally been a significant driver for us, and we expect it to remain that way, especially as it facilitates easier sales to new customers and helps us attract sellers from competitors. Another component that we believe will be impactful in the next year is Square AI, which is becoming increasingly sophisticated. Initially, it allowed our customers to generate customized reports, and as mentioned in previous calls, we aim for it to function as a virtual COO or manager to aid businesses of all kinds. Our team is dedicated to ensuring it realizes that vision, beginning with the dashboard where our sellers spend most of their time. This also presents an opportunity to introduce them to the broader Square ecosystem, including our banking and customer relationship services. Moreover, we recently announced the ability to accept Bitcoin through Square. While still in its early stages, we view this as a significant enhancement and a valuable addition to our offerings. We aim to support all forms of payment, including Bitcoin, Tether, and Circle, so sellers can always close a sale, which is essential for us. Therefore, our hardware, AI developments in the dashboard and app, and the acceptance of new payment methods enable our sellers to operate more comprehensively and flexibly. We are also strengthening our go-to-market strategy and sales efforts. Our recent marketing release was a success, and the team is refining our approach, which is beginning to yield positive results across all seller scales. This positions us well to compete based on the strength of our offerings, which we believe are substantial.

Operator, Operator

We will now take our last question from the line of David Koning from Baird.

David John Koning, Analyst

Great job. I guess you touched on the willingness to accept stablecoins at your sellers. I was just thinking more broadly. You focused so much on Bitcoin historically. Kind of what's your philosophical thought around stablecoins? Where do you think it's going to be most useful? And how might you guys play within the broader stablecoin ecosystem?

Jack Dorsey, CEO

I think the most important thing is if people want to use it to purchase or if they want to use it to transact or transmit money through Cash App, we're going to support it. So you should expect Square and Cash App to support these things if people are using them, and we would focus on the major ones in use. We do have a bank and we can offer our own stablecoin, and there are a lot of stablecoins being generated right now. And I don't necessarily always see the product market fit for all of them. I don't see the differentiator. It really comes down to what are people using and why they're using it. And right now, stablecoins are predominantly used in a remittance use case. If they do become more payments-oriented, we'll be there. I don't think right now that it makes sense for us to offer our own because I just don't think there's a huge differentiator above and beyond what exists and in my view, above and beyond what Bitcoin provides. Bitcoin still stands alone in it being entirely net new, and it has properties that none of these stablecoins have, which make it a better form of currency than the rest of them. It's certainly proven the case over 16 years as a store value. But our intention is to make sure that Bitcoin becomes the native currency of the Internet and that's used as everyday money. And we think it can get there very quickly. And the reason to focus on that is because it's independent of any one particular corporation or any government. And it allows us to move much faster with our business as it does become more and more of a standard, not only at store value but remittance and also payment that allows Square to go to every single market almost instantly. And the same is true for Cash App as well. So we're huge believers in it. We know it's going to be a long road. It's a protocol. Protocols move a lot slower than products and companies tend to do, but they tend to last longer as well. And that's why we believe in it so much, and we think it massively accelerates our business when it does hit, and we intend on making a hit as soon as possible.

Operator, Operator

Ladies and gentlemen, thank you for your participation in today's program. This does conclude the program. You may all disconnect.