We delivered another strong quarter, outperforming our guidance across gross profit, adjusted operating income, and adjusted diluted EPS. Gross profit grew 26%-27% year-over-year to $2.91 billion in the first quarter, driven by accelerating growth in both Cash App and Square. Adjusted operating income increased 56% year-over-year to $728 million or 25% margin. Adjusted EBITDA reached $1 billion, and adjusted diluted EPS grew 52% year-over-year to $0.85.
Each of these adjusted metrics represented all-time highs on a dollar and margin basis. Cash App gross profit growth was 38% year-over-year in the first quarter, driven by accelerating growth in both commerce enablement and financial solutions. Cash App monthly transacting actives grew 4% year-over-year as we continued to execute on our product and go-to-market strategies to strengthen network growth. We continued to deepen engagement across our actives base, with inflows per transacting active up 10% year-over-year and Primary Banking Actives growth of 18% year-over-year to 9.7 million.
Turning to Square, where gross profit and GPV growth accelerated in the first quarter to 9% and 13% respectively. On a constant currency basis, GPV grew 11.5% year-over-year, improving across both the U.S. We accelerated GPV growth from food and beverage sellers to 21% year-over-year and from mid-market sellers to 22% year-over-year, both reflecting the strongest growth rates we've seen since Q1 2023. International GPV grew 35% year-over-year or 26% on a constant currency basis.
| Metric | Period | Current guidance |
|---|---|---|
| Full-year 2026 gross profit | FY2026 | $12.33B (19% growth) (Raised ~1 pt of growth) |
| Full-year 2026 adjusted operating income | FY2026 | $3.34B (27% margin) (Margin raised ~1 pt) |
| Q2 gross profit | Q2 2026 | $3.04B (20% YoY growth) (New) |
| Q2 adjusted operating income | Q2 2026 | $740M (35% growth, 2 pts margin expansion) (New) |
| Q2 adjusted diluted EPS | Q2 2026 | $0.86 (39% YoY growth) (New) |
| Q2 interest expense | Q2 2026 | $55M-$60M (New) |
| Full-year interest expense | FY2026 | ~$200M-$210M (New) |
| Non-GAAP effective tax rate | Q2 and FY2026 | mid-20% (Reaffirmed) |
| Year-end gross profit growth exit rate | exit FY2026 | mid-teens (Reaffirmed) |
| Metric | YoY | Note |
|---|---|---|
| Total gross profit | +26%-27% to $2.91B | Accelerating growth in both Cash App and Square |
| Cash App gross profit | +38% | Accelerating growth in commerce enablement and financial solutions |
| Adjusted operating income | +56% to $728M | Outperformance with disciplined investment; adjusted profitability grew at roughly twice the rate of gross profit |
| Adjusted diluted EPS | +52% to $0.85 | Strong execution and record adjusted profitability |
| Square GPV | +13% (11.5% constant currency) | Acceleration across U.S. and international, driven by NVA and improving net volume retention |
| Cash App monthly transacting actives | +4% | Product and go-to-market execution to strengthen network growth; fastest actives growth in about a year and a half |
| Inflows per transacting active | +10% | Deeper engagement across the actives base |
| Primary Banking Actives | +18% to 9.7M | Increased banking engagement across the platform |
| Consumer lending originations | +82% | Strength in Borrow and broader lending products |
| International GPV | +35% (26% constant currency) | Field sales investments and expansion across U.K., Australia, Canada |
| Square gross profit excluding hardware costs | +11% | Hardware costs (a customer acquisition driver) weighed on reported 9% growth |
| Topic | Previous mention | Current period | Trend |
|---|---|---|---|
| AI / intelligence-driven products | Everything fundamentally changed over the past five or six months since late last year | MoneyBot generally available, ManagerBot to 1M+ sellers (all Square sellers by June), proactive action-oriented systems as core strategy | Accelerating |
| Product development velocity | Velocity meaningfully increased even from back half of last year | Production code changes per engineer up 2.5x since January; features once scoped to 5-6 engineers and 1-2 quarters now shipped by 1-2 engineers in weeks | Accelerating |
| Organizational reorg / flatter structure | Action taken was monumental and foundational | Smaller, flatter teams driving more autonomy, faster decision-making, and DRI model; further flattening expected | Progressing positively |
| Cash App Borrow / lending expansion | Exceptional growth over the past year | Shifted fully to internal bank (SFS) origination; expanding states, Cash App Green eligibility, and limits; growth normalizing but durable | Normalizing but compounding |
| Buy now, pay later across Cash App | Afterpay Post-Purchase in market over a year | Pre-purchase BNPL launched and scaling; BNPL extended to peer-to-peer and Cash App Pay; each lending product grew faster than the prior one | Expanding |
| Neighborhoods (connecting sellers and consumers) | 2025 was about establishing product-market fit | $320M annualized GPV (up 190% since December); April added more sellers than entire program history; expected to meaningfully drive Cash App actives in 2H | Inflecting |
| Square go-to-market diversification | Field sales and self-onboarded ramping | 140+ active ISO partners (200% QoQ growth in new sellers), exceeding expectations; field presence in U.S., U.K., Australia, Canada | Diversifying and scaling |