Block buys back stocks worth 5 billion! The gross profit plan for 2028 is revealed, driving the stock price big pump by 9%.

Shares of Block, Inc. surged nearly 9% on Wednesday after the company announced plans to achieve a gross profit of $15.8 billion by 2028 and revealed a $5 billion stock buyback plan. Block expects gross profit to reach $15.8 billion by 2028, with an annual adjusted operating income growth rate of 30%.

Block Three-Year Financial Goals Reflect Transformation Ambitions

(Source: Block)

Block has laid out a roadmap aiming for approximately 15% gross profit growth annually by 2028. The company expects adjusted operating revenue to grow at an annual rate of about 30%, reaching $4.6 billion by 2028. Adjusted earnings per share are projected to increase by more than 30% each year, reaching $5.50 by 2028. These goals demonstrate Block's ambition to transform from a payment processor into an integrated fintech platform.

In this event, CEO Jack Dorsey made a rare appearance. Due to the competition in the payment sector, Block's stock price fell by 30% at the beginning of 2025. However, the trading suspension and subsequent announcement quickly reversed the decline, with the stock price soaring nearly 9% in a single day, demonstrating the market's strong recognition of Block's new strategy.

Block is expected to see a gross profit growth of 17% in the fiscal year 2026, reaching nearly $12 billion. Adjusted operating revenue and earnings per share are both expected to grow by over 30%, reaching $2.7 billion and $3.20, respectively. The new non-GAAP cash flow metric (which accounts for capital needs related to loans) is expected to account for 25% of gross profit by 2028, exceeding $4 billion. The introduction of this new metric indicates that Block is comprehensively assessing its business's cash-generating capacity.

Block 2028 Financial Goal Overview

Gross Profit Target: $15.8 billion (15% annual growth)

Adjusted Revenue: 4.6 billion USD (Year-over-year growth 30%)

Adjusted Earnings Per Share: $5.50 (Year-over-year growth of over 30%)

Non-GAAP Cash Flow: Over $4 billion (25% of gross profit)

Block's goal is to achieve the “40 Rule” benchmark by 2026 and maintain it until 2028. This performance indicator combines over 40% revenue growth and profit margin, making it a key objective for software and fintech companies. Block's official statement emphasizes the efficiency, scale, and product innovation of its financial network. Achieving the “40 Rule” means that Block will enter a phase of efficient growth, capable of sustaining rapid expansion while maintaining healthy profitability.

$5 billion buyback shows cash flow confidence

The expanded stock repurchase plan adds $5 billion to the previously authorized $1.1 billion. Currently, Block Inc. has approximately $6.1 billion available for stock buybacks, demonstrating the company's confidence in its cash flow. Such large-scale repurchase programs are uncommon in the fintech industry and are typically undertaken only by companies with extremely robust cash flows and high certainty about future performance.

The $5 billion repurchase scale is equivalent to approximately 10% to 15% of Block's current market value (depending on the stock price), and this scale of repurchase will have a significant enhancement effect on the value per share. Stock buybacks reduce the number of shares outstanding, increase earnings per share and cash flow per share, while also signaling to the market that management believes the stock price is undervalued.

Block's performance in the third quarter is mixed, with profits and revenue slightly below analyst expectations. However, gross profit grew by 18.3%, mainly benefiting from a 24.3% growth in Cash App. Square also contributed to a 9.2% increase in gross profit. Although the quarterly performance did not meet expectations, the strong growth in gross profit indicates that Block's core business remains healthy.

Cash App remains a growth engine for Block. Monthly active users have reached 58 million, with a profit growth of 25.3% per user. Total payment volume has increased by 10.9% year-over-year. Subscription and service revenue grew by 22.6%, indicating a healthy source of recurring income. However, revenue associated with Bitcoin has decreased by 19%. Nevertheless, Block continues to maintain strong liquidity, with ample cash reserves and debt levels under control.

Management pointed out that since the Investor Day in 2022, gross profit has nearly doubled, and adjusted EBITDA has grown twofold. The company currently operates 26 products, with annual gross profit exceeding 100 million USD, demonstrating the healthy diversification of its product portfolio. This diversification reduces Block's reliance on a single product line and enhances the overall business's resilience against risks.

Zero transaction fee Bitcoin payments enable 4 million merchants

Block's expansion plan includes investments in technology and finance sectors beyond payment processing. Its brands include Square, Cash App, Afterpay, TIDAL, Bitkey, and Proto. This multi-brand strategy allows Block to cover a wide market ranging from merchants to consumers, and from payments to entertainment.

In October, Square launched Square Bitcoin, allowing over 4 million US merchants to accept and manage Bitcoin through the existing Square system. Merchants can accept Bitcoin payments at checkout, with up to 50% of daily sales converted to Bitcoin, and manage their Bitcoin accounts on the Square dashboard. This seamless integration lowers the technical barrier for merchants to adopt Bitcoin, potentially driving large-scale applications of Bitcoin in physical retail scenarios.

The Bitcoin payment plan will be launched on November 10, 2025, for a duration of one year, with zero transaction fees. The program covers all U.S. states except New York, which is subject to regulatory restrictions. In the pilot program in 2024, merchants accumulated a total of 142 bitcoins, showing a strong interest from retailers in Bitcoin and other cryptocurrencies. The zero-fee strategy is clearly aimed at quickly capturing market share; once merchants get accustomed to using Bitcoin for payments, Block will have a large user base to launch more cryptocurrency-related services.

The company is deploying artificial intelligence tools for merchants and expanding the financial services of Cash App. Management emphasized the technological unity and efficiency improvements across the entire ecosystem. These measures aim to reduce dependence on the core POS business as competition from PayPal, Stripe, and traditional payment processors intensifies.

Block: A Decade of Transformation from Card Readers to Fintech Giants

Since its launch in 2015, Block has undergone ten years of development, transforming from a card reader supplier into a diversified fintech giant. The announcement on November 19 aims to guide the company toward maturity in its core markets and seek growth in the fields of cryptocurrency infrastructure and AI-driven services, thereby establishing a clear development path.

Chief Operating Officer and Chief Financial Officer Amrita Ahluwalia emphasized Block's focus on scale and long-term value. The leadership expressed confidence in innovation and investment, believing that these two measures will drive the company to achieve compound growth and improved profit margins by 2028. This long-term vision is particularly rare in the current market environment that emphasizes short-term performance.

Block's transformation strategy reflects the evolving trends in the fintech industry. The profit margins of pure payment processing businesses are becoming increasingly thin, and competition is becoming fiercer. Successful fintech companies must build ecosystems that provide a full range of financial services, from payments to loans, and from savings to investments. Block has entered consumer financial services through Cash App, tapped into the buy now pay later market through Afterpay, and laid out cryptocurrency infrastructure with Bitcoin products, all of which are concrete manifestations of its ecosystem strategy.

The combination of a $5 billion buyback plan, a 30% annual growth target, and zero-fee Bitcoin payments demonstrates Block's dual commitment to rewarding shareholders while seizing new markets. The market responded with a 9% single-day increase, indicating that investors are filled with anticipation for Block's new strategy under the leadership of Jack Dorsey.