Block lifts profit outlook on Cash App growth, settles DOJ probe

Block raised its full-year gross profit outlook Tuesday after strong Cash App performance boosted quarterly earnings, and reached a preliminary settlement with the US Department of Justice over its anti-money laundering program. Shares rose 7% in extended trading. Cash App gross profit surged 27% in the third quarter, while Square merchant business grew 14%, helping diversify revenue beyond transaction fees. However, credit losses rose 65.6% to $601.7 million. Block now expects 2026 gross profit of $12.63 billion, up from a prior $12.51 billion forecast. The DOJ settlement involves a three-year deferred prosecution agreement over Bank Secrecy Act violations, with an expected net payment of roughly $764 million. Block also forecast 2027 gross profit of $14.52 billion, citing AI investments, and expects first direct AI revenue in the fourth quarter.