AI interpretation based on checked source excerpts. Issuer assertions and evidence limitations remain explicit.
Policy quality-scores-2: six equally weighted categories. The overall score requires full coverage. Missing inputs are not zero. Qualitative grades are sourced interpretations, not probabilities. 4/6 · 18/10/2026
Moat31
Equal-weight average of four evidence-backed rubric grades (0–4), scaled to 100.
structural advantage · 1/4 · Integration, favorable processing terms relative to individual sellers and automated risk assessment provide operating utility. Limited switching barriers and absent proof of superiority over other platforms leave structural protection weak.
durability · 1/4 · Negotiated processing benefits recur across annual disclosures, but contract protection, exclusivity and persistent competitive superiority are unestablished. Customers generally have no long-term contracts.
customer dependency · 2/4 · Integrated business workflows and growing payment activity indicate meaningful use, assessed indirectly. They do not demonstrate customer lock-in, and switching costs may be insignificant for many services.
erosion resilience · 1/4 · Growing GPV is positive operating evidence, but low switching barriers, actual tariff margin pressure, historical service problems and paid regulatory penalties show fragile protection. None alone establishes realized market-share loss.
Pricing power—
Insufficient evidence for every rubric criterion; no category score is inferred.
realized pricing · — · Transaction fees are disclosed, but no observed fee changes, discounts, realized take-rate movement or customer response to an implemented pricing change is supplied. Tariff cost pressure alone does not establish realized pricing.
retention · 2/4 · Substantial Cash App inflows, integrated workflows and GPV growth provide indirect evidence of continuing demand. Aggregate growth cannot separate retained customers from new acquisition, and disclosed switching friction is limited.
margin resilience · 2/4 · First-half 2026 gross profit rose to $6.08 billion from $4.83 billion, but operating income fell to $275 million from $814 million and transaction and credit losses increased. Actual tariff pressure affects certain products. Mixed results do not isolate pricing from mix, credit costs or restructuring.
contractual freedom · 2/4 · Generally absent long-term customer contracts and transaction-based charging suggest flexibility to offer current terms, balanced by customers' ability to leave. Explicit unilateral repricing rights and restrictions are not supplied.
Predictability84
Five consecutive annual periods. Equal weights: nondeclining revenue frequency; revenue-growth volatility (5–40pp); positive FCF frequency; FCF-margin volatility (3–20pp). Stability indicator, not a growth forecast.
- Nondeclining revenue years (%)
- 75.00
- Revenue growth volatility (pp)
- 10.34
- Positive FCF years (%)
- 80.00
- FCF margin volatility (pp)
- 3.89
Financial strength79
Equal-weight grades: debt/FCF (1–8x), net debt/earnings before interest and tax (0–5x), interest service (1–12x), current ratio (0.75–2x). Earnings use reported operating income, or reported pretax profit plus reported interest expense when operating income is unavailable. Interest service uses earnings/interest expense; if unavailable, it uses reported operating cash flow/cash interest paid, without relabeling cash paid as accrued expense. Nonpositive cash flow/earnings score 0 for their service component; reported zero interest with a positive numerator scores 100. Net cash scores 100 for net leverage. Missing disclosures remain unavailable. General nonfinancial-company rubric, not a credit rating; exceptional and nonoperating gains are not normalized out. IFRS finance-cost and cash-flow classifications retain their reported scope.
- debtFcfGrade
- 71.34
- netDebtEbitGrade
- 91.51
- interestCoverageGrade
- 51.48
- currentRatioGrade
- 100.00
- Debt / FCF (x)
- 3.01
- Net debt / operating income (x)
- 0.42
- Interest coverage (x)
- 6.66
- Current ratio (x)
- 2.20
Capital allocation—
Missing required inputs: operatingReturn. Three-year equal-weight indicators: pretax return on average invested capital (0–25%; equity + debt − cash, each year and its prior year), share-count growth (0–5%, lower better), share-based cost/revenue (2–20%, lower better), consolidated FCF/net income (0–1x). Return uses reported operating income or, if unavailable, EBIT calculated from reported pretax profit plus reported interest expense; exceptional/nonoperating gains are not normalized out. Share-based cost uses the reported cash-flow add-back or, if absent, separately reported recognized compensation expense; the latter never becomes an FCF adjustment. Nonpositive net income scores 0 for cash conversion; absent income/FCF stays unavailable. Nonpositive invested capital has no defined return and remains unavailable. Does not establish acquisition quality or buyback timing.
- 3-year average dilution (%)
- 1.91
- 3-year average SBC / revenue (%)
- 5.37
- cashConversionGrade
- 93.24
Management50
Equal-weight average of four evidence-backed rubric grades (0–4), scaled to 100.
capital discipline · 2/4 · Actual 2025 operating cash generation of $2.6 billion, completed first-half 2026 repurchases of $700.9 million and substantial disclosed liquidity support funding capacity. Recurring dilution, $2.30 billion of purchase commitments and weaker first-half GAAP earnings temper the assessment; buyback value creation is unproven.
incentive alignment · 2/4 · Existing option and RSU incentives vest over four years subject to service, providing stock-price exposure and retention incentives. Discretionary award criteria weaken direct linkage to operating outcomes. Expected 2026 bonus changes are not treated as adopted or paid, and ownership percentages are missing.
execution · 2/4 · Assessed indirectly from operating results: GPV, gross profit and adjusted operating income grew, while GAAP operating income declined and transaction and credit losses rose. Historical system problems and the paid customer-dispute penalty add demonstrated execution weaknesses. Adjusted results exclude restructuring and other costs.
governance · 2/4 · A lead independent director and independent audit and compensation committees provide actual oversight structures. Combined executive/chair roles, a staggered board, dual-class shares and realized regulatory costs temper those safeguards. Voting-control concentration is not supplied.
Evidence
Our Square ecosystem consists of more than 30 distinct commerce enablement and financial services products.
Business: Square product breadth · Filed 26/02/2026
Our products are integrated to create a seamless experience and enable a holistic view of sales, customers, employees, and finances.
Business: Square product integration · Filed 26/02/2026
These tools are designed to seamlessly integrate with other Square products eliminating the latent, time-consuming, and error-prone processes typically used to copy and sync data between disparate systems.
Business: staff management integration · Filed 24/02/2025
We generally do not have long-term contracts with our sellers and customers, and the difficulty and costs associated with switching to a competitor may not be significant for many of the services we offer.
Risk factors: customer contracts and switching costs · Filed 26/02/2026
Competitors that overlap with certain functions and features that we provide include: •Business software providers such as those that provide point of sale, website building, inventory management, employee management, customer relationship management invoicing, and appointment booking solutions; •Payment terminal vendors; •Merchant acquirers; •Banks that provide payment processing, checking, savings, loans, and payroll; •Pen and paper, manual processes, and paper currency; •Payroll processors; and •Established or new alternative lenders.
Competition: overlapping provider categories · Filed 26/02/2026
These contracts include negotiated terms, such as more favorable pricing, that are generally not available to sellers if they were to contract directly with these sub-service providers.
Business: negotiated transaction-processing terms · Filed 24/02/2025
These contracts include negotiated terms, such as more favorable pricing, that are generally not available to sellers if they were to contract directly with these sub-service providers.
Business: negotiated transaction-processing terms · Filed 22/02/2024
In our Square ecosystem, this technology platform enables us to capture and analyze billions of transactions per year and automate risk assessment for more than 99.95% of all transactions.
Business: transaction scale and automated risk assessment · Filed 26/02/2026
We compete against many companies to attract customers across our products and services, and some of these companies have greater financial resources and substantially larger bases of customers than we do, which may provide them with significant competitive advantages.
Competition risks: competitors' resources and customer bases · Filed 26/02/2026
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS (Unaudited) (In thousands, except per share data) Three Months Ended June 30, Six Months Ended June 30, 2026 2025 2026 2025 Revenue: Commerce enablement revenue $ 3,341,571 $ 2,898,302 $ 6,280,041 $ 5,465,277 Financial solutions revenue 1,382,368 984,553 2,704,353 1,859,564 Bitcoin ecosystem revenue 1,893,748 2,171,602 3,690,140 4,501,412 Total net revenue 6,617,687 6,054,457 12,674,534 11,826,253 Cost of revenue: Commerce enablement costs 1,523,639 1,354,370 2,841,098 2,506,570 Financial solutions costs 93,819 82,649 183,194 160,571 Bitcoin ecosystem costs 1,821,343 2,066,504 3,549,300 4,303,901 Amortization of acquired technology assets 12,805 14,404 25,622 29,078 Total cost of revenue 3,451,606 3,517,927 6,599,214 7,000,120 Gross profit 3,166,081 2,536,530 6,075,320 4,826,133 Operating expenses: Product development 608,660 725,288 1,647,533 1,485,987 Sales and marketing 664,955 549,731 1,315,463 1,054,191 General and administrative 825,869 449,237 1,683,433 941,034 Transaction, loan, and consumer receivable losses 585,450 294,090 1,085,575 463,779 Amortization of customer and other acquired intangible assets 34,277 33,891 68,436 67,547 Total operating expenses 2,719,211 2,052,237 5,800,440 4,012,538 Operating income 446,870 484,293 274,880 813,595 Interest expense, net 55,721 23,687 108,916 40,930 Remeasurement loss (gain) on bitcoin investment 88,474 (212,165) 261,292 (118,814) Other expense (income), net 1,199 13,389 (4,227) 5,047 Income (loss) before income tax 301,476 659,382 (91,101) 886,432 Provision for income taxes 214,407 121,048 130,425 159,376 Net income (loss) 87,069 538,334 (221,526) 727,056 Less: Net loss attributable to noncontrolling interests (1,448) (124) (1,362) (1,274) Net income (loss) attributable to common stockholders $ 88,517 $ 538,458 $ (220,164) $ 728,330 Net income (loss) per share attributable to common stockholders: Basic $ 0.15 $ 0.88 $ (0.37) $ 1.18 Diluted $ 0.15 $ 0.87 $ (0.37) $ 1.17 Weighted-average shares used to compute net income (loss) per share attributable to common stockholders: Basic 597,829 612,882 597,702 616,108 Diluted 608,847 618,928 597,702 627,103 The accompanying notes are an integral part of these unaudited condensed consolidated financial statements.
Unaudited statements of operations: six months ended June 30, 2026 and 2025 · Filed 05/08/2026
In 2024, Cash App transacting actives brought $283 billion in inflows into Cash App.
Business: 2024 Cash App inflows · Filed 24/02/2025
•Networks: Our strategy includes strengthening local commerce ecosystems by enabling deeper connections among sellers, their customers, staff, and other sellers, and by leveraging Cash App’s network of monthly transacting actives to expand seller reach and support ecosystem engagement.
Square strategic priorities: networks · Filed 26/02/2026
This could represent, among other things, one customer with multiple accounts or multiple customers sharing one alias identifier (for example, families).
Operating definitions: accounts and customer identity · Filed 26/02/2026
Our competitors include money transfer apps, prepaid debit card offerings, brokerage firms, tax firms, financial technology apps, banks, and crypto trading services.
Cash App competition: provider categories · Filed 24/02/2025
Pursuant to the consent order, the Company paid a $55 million civil monetary penalty in January 2025 and agreed to pay between $75 million and $120 million in restitution to certain Cash App customers.
Regulatory matters: January 2025 penalty and restitution commitment · Filed 24/02/2025
Three Months Ended June 30, Six Months Ended June 30, 2026 2025 2026 2025 Gross Payment Volume (GPV) (in millions) $ 74,734 $ 66,615 $ 137,843 $ 123,412 Adjusted Operating Income (in thousands) $ 863,845 $ 549,569 $ 1,591,517 $ 1,015,838 Adjusted EBITDA (in thousands) $ 1,168,597 $ 891,422 $ 2,178,818 $ 1,704,216 Adjusted Net Income Per Share: Basic $ 1.04 $ 0.63 $ 1.89 $ 1.20 Diluted $ 1.02 $ 0.62 $ 1.87 $ 1.18 Gross Payment Volume (GPV) GPV includes Square GPV and Cash App GPV.
Operating metrics: GPV and adjusted operating income · Filed 05/08/2026
These tariffs negatively affect our gross margin on the impacted products, and increases in our pricing as a result of tariffs may adversely affect demand for our products or reduce the competitiveness of our products if our competitors do not make similar pricing adjustments.
Tariff risks: actual affected-product margin pressure and prospective pricing consequences · Filed 05/08/2026
We charge the customer a per transaction fee when they instantly deposit funds to their bank account or withdraw funds from an ATM.
Revenue recognition: transaction fees for instant deposits and ATM withdrawals · Filed 26/02/2026
For the year ended December 31, 2025, cash provided by operating activities was $2.6 billion, primarily due to net income of $1.3 billion, adjusted for non-cash expenses of $3.4 billion consisting primarily of transaction, loan, and consumer receivable losses; share-based compensation; depreciation and amortization; changes in deferred income taxes; non-cash lease expense; and losses on bitcoin remeasurement, each of which contributed positively to cash provided by operating activities.
Cash flows: 2025 operating cash generation · Filed 26/02/2026
During the six months ended June 30, 2026, the Company repurchased 11.6 million shares of its Class A common stock for an aggregate amount of $700.9 million, excluding excise tax, which was immaterial.
Stockholders' equity: completed first-half 2026 repurchases · Filed 05/08/2026
As of June 30, 2026, the future minimum payments under the purchase commitments were as follows (in thousands): Payments Due By Period Remainder of 2026 $ 280,143 2027 457,317 2028 386,171 2029 370,000 2030 410,000 Thereafter 392,000 Total $ 2,295,631 34 Other Contingencies The Company is under examination, or may be subject to examination, by several tax authorities.
Commitments: future minimum purchase payments · Filed 05/08/2026
As of June 30, 2026, we had approximately $8.8 billion in available liquidity, with $7.9 billion in cash, cash equivalents, restricted cash, and investments in marketable debt securities, as well as an undrawn amount of $900.0 million available under our revolving credit facility.
Liquidity: June 30, 2026 available liquidity and composition · Filed 05/08/2026
Equity incentives were provided through a combination of stock options and RSUs.
Executive compensation: actual 2025 equity incentive instruments · Filed 24/04/2026
(1)One forty-eighth of the shares subject to the option vest each month beginning April 20, 2025, subject to continued service with the Company.
Executive compensation: option vesting terms · Filed 24/04/2026
(2)One-sixteenth of the RSUs vest in equal quarterly installments over four years beginning May 20, 2025, subject to continued service with the Company.
Executive compensation: RSU vesting terms · Filed 24/04/2026
We do not have an established set of criteria for granting equity awards.
Executive compensation: discretionary equity award criteria · Filed 24/04/2026
Because Mr. Dorsey is our Chairperson and is not an “independent” director as defined in NYSE listing standards, our board of directors has appointed Roelof Botha as our Lead Independent Director.
Governance: combined executive/chair role and lead independent director · Filed 24/04/2026
In addition, each member of our audit and risk committee and our compensation committee meets the enhanced independence standards required for such committee members under the applicable rules and regulations of the SEC and the NYSE listing standards.
Governance: audit and compensation committee independence · Filed 24/04/2026
Our board of directors is divided into three staggered classes of directors.
Governance: staggered board · Filed 24/04/2026
•the dual class structure of our common stock;
Ownership risks: dual-class stock structure · Filed 26/02/2026
In view of the limitations associated with Adjusted EBITDA, we also present Adjusted Operating Income (Loss), which is a non-GAAP financial measure that excludes certain expenses that we believe are not reflective of our core operating performance, including amortization of intangible assets, acquisition-related and integration costs, various contingencies, restructuring and other costs, and goodwill and intangible asset impairment charges.
Non-GAAP definitions: adjusted operating income exclusions · Filed 05/08/2026
Software and system errors, or human errors, could delay or inhibit settlement of payments, result in oversettlement, cause reporting errors, cause pricing irregularities or prevent us from collecting transaction-based fees, or negatively impact our ability to serve our customers, all of which have occurred in the past.
Operational risks: previously experienced system and collection problems · Filed 05/08/2026
2026 Executive Compensation Changes Beginning in 2026, we expect to introduce an annual cash incentive bonus program for our leadership team, including our named executive officers, with payouts based on the achievement of company-wide gross profit and operating income targets.
Executive compensation: expected 2026 cash incentive changes · Filed 24/04/2026
