Block vs. PayPal: how they make money

• Cash App users and the merchants they shop at · 63.8% of revenueCash App segment revenue: bitcoin bought by customers ($8.35 billion), Borrow and Instant Deposit fees, card interchange paid on Cash App Card spending, and Afterpay fees paid by merchants.
• Square sellers · 34.9% of revenueSquare segment revenue: payment processing fees, software subscriptions, hardware, and loan and banking fees from businesses.
• Corporate and other · 1.3% of revenueTIDAL and other businesses not assigned to a segment, net of sales between segments.

• MerchantsPay transaction fees, mostly a share of each payment, when customers pay with PayPal or Venmo or through unbranded processing. Share not disclosed.
• ConsumersPay for currency conversion, cross-border payments, instant transfers to a bank and crypto purchases, plus interest and fees on credit. Share not disclosed.
• Partners and interest on customer moneyPartnership, referral, subscription and gateway fees, and interest on customer balances PayPal holds: $1,230 million in FY2025 ($1,284 million in FY2024), as stated in the Q4 FY2025 earnings release.

FY2025; revenue by segment (Block measures segments by gross profit)

FY2025; revenue types, as PayPal reports one segment

Debt

$5.7B

Cash and investments

$7.9B

On Sep 30, 2026.

Block owed $5.72 billion of notes at Sep 30, 2026 and held $7.86 billion of cash, a net cash position of $2.14 billion (Cityfort calculation from the Q3 FY2026 shareholder letter); warehouse loans that fund its consumer lending were another $1.54 billion.

Debt

$13.5B

Cash and investments

$15.1B

On Sep 30, 2026.

At Sep 30, 2026, PayPal's cash and investments exceeded its debt by $1.6 billion, down from $3.2 billion at Dec 31, 2025; customer funds are not counted as cash.

• 2 classes of shares (votes per share: Class A common stock 1, Class B common stock 10).
• Officers and directors as a group: 11.4% of shares, 53.3% of votes (as of Mar 31, 2026).
• Jack Dorsey, co-founder, Block Head and Chairperson (% of Class B): 79.8% of its class, 42.2% of votes (as of Mar 31, 2026).
• James McKelvey, co-founder and director (% of Class B): 19.9% of its class, 10.5% of votes (as of Mar 31, 2026).
• Vanguard Capital Management (% of Class A): 7.7% (as of Apr 29, 2026).
• 2 more holders on the Block page.

• One class of shares.
• Officers and directors as a group: 0.6% of shares, 0.6% of votes (as of Mar 25, 2026).
• The Vanguard Group: 10.1% (as of Jan 30, 2026).
• BlackRock: 8.1% (as of Jan 26, 2024).

• Co-founders control the votes (governance)Class B shares carry 10 votes each. On Mar 31, 2026 Jack Dorsey had 42.2% of votes and James McKelvey 10.5%, and officers and directors together 53.3%. Class B was 52.4% of votes on Oct 30, 2026 (Cityfort calculation from the Q3 FY2026 10-Q cover). Dorsey is also Chairperson and principal executive officer.
• Bitcoin moves revenue and profit (commodity costs)Bitcoin ecosystem revenue was $8.50 billion in FY2025. Block's own bitcoin, worth $771.9 million at Sep 30, 2026, is marked to market: it caused a $172.8 million loss in Q1 FY2026 and a $229.7 million gain in Q3 FY2026.
• Reliance on payment processors and partner banks (customer or supplier concentration)Three processors made up 40%, 25% and 12% of settlements receivable at Sep 30, 2026. Partner banks issue the Cash App Card and Square Checking.

• Slower growth at the PayPal button (competition)Online branded checkout volume grew 1% in Q3 FY2026 on a currency-neutral basis, down from 5% a year earlier, and was 27% of total payment volume. PayPal's 10-K describes competition in payments as intense.
• Funding costs and take rate (pricing)Transaction expense took $47.9 of every $100 that came in during FY2025. Revenue per $100 of payment volume fell from $1.84 in Q3 FY2025 to $1.76 in Q3 FY2026.
• Regulators' investigations (regulation)The FTC, the CFPB, Germany's Federal Cartel Office and the U.K. FCA have open investigations or demands, including an FTC demand from Sep 2026 on fees and purchase protection.
• Fraud and credit losses (other)Transaction and credit losses rose 19% to $1,720 million in FY2025. Loans held for sale were $3,687 million and loans and interest receivable $5,618 million at Sep 30, 2026.
• Interest on customer balances (other)PayPal earned $1,230 million of interest on customer balances in FY2025 ($1,284 million in FY2024), as stated in the Q4 FY2025 earnings release. It was $289 million in Q3 FY2026.
• Cyberattacks (technology)PayPal's 10-K lists cyberattacks and security weaknesses first among its risk factors. It holds money and data for 439 million active accounts.