Block is expanding its artificial intelligence capabilities across its Square and Cash App platforms, aiming to streamline operations for merchants and attract more shoppers to local businesses. The company reported that Cash App reached 60 million monthly transacting users in September, marking its fastest growth pace since mid-2024.
Square Payment Volume and AI Integration
During its third-quarter earnings call, Block highlighted significant growth in its Square payment processing business. The company processed $76.4 billion in volume, a 14 percent increase from the same period last year. Food and beverage merchants led this growth, with payment volume rising 20 percent. Retail volume increased by 13 percent, while services grew by 8 percent.
Block is deploying AI on both sides of the transaction. For merchants, the new Square Kiosk allows customers to place orders and ask menu questions using voice commands. On the backend, Squaremates already generates purchase orders for food and beverage sellers. Block plans to introduce procurement agents to help manage inventory and order from suppliers.
Chief Executive Officer Jack Dorsey noted that smaller sellers are eager for tools that are easy to use and immediately accessible. Sellers typically begin by asking questions about their data before handing over tasks to AI agents. Block is currently testing how to charge for these AI tools, which are available to other companies through its Builder Lab and Buzz platforms.
Cash App Expansion and Financial Results
The growth in Cash App users was partly driven by Neighborhoods, a feature launched in late August that connects Cash App users with participating Square sellers. By September, participating sellers represented approximately $5 billion in annualized gross payment volume, nearly five times the level seen in June. Block funds the sign-up bonuses and ongoing rewards for this program.
Block Business Lead Owen Jennings stated that customers acquired through Neighborhoods tend to have higher household incomes than Cash App’s core user base. The platform enabled Neighborhoods for about 30,000 sellers. Jennings suggested that sellers may eventually help fund rewards as they gain more customers to market to directly.
Primary banking users on Cash App rose to 9.4 million from 8.3 million a year earlier. About 28 million customers used the Cash App Card monthly. Block also reported that one in five customers who ordered a Tag, a personalized accessory for the card, was new to the card or had returned to using it.
Third-quarter net revenue rose to $6.7 billion from $6.1 billion in the third quarter of last year. In lending, Cash App adjusted its Borrow product terms from four weeks with a 5 percent fee to six weeks with a 7.5 percent fee. Afterpay’s post-purchase originations more than tripled year over year, while pre-purchase originations more than tripled from the previous quarter.
Dorsey told analysts that Block sees a market for its AI tools beyond the Square sellers that helped shape them. He described the foundation as enabling the company to serve businesses of all sizes, from the smallest sellers to those larger than Block itself.
Source: PYMNTS
