Block, Inc.XYZ

Block describes Cash App Tags with a foundation for agentic commerce built in.

“That same practice keeps producing. It built Bitkey and Proto for bitcoin custody and mining. It gave tens of millions of people custom designed Cash App Cards. And this quarter it produced Cash App Tags, NFC chips that connect physical objects to a customer’s Cash App Card and turn everyday items into payment instruments, with a foundation for agentic commerce built in. Tags follow the reader’s playbook exactly: iconic hardware driving viral acquisition. A capability we built fifteen years ago is still opening new growth surfaces today.”

Block launched internal agentic AI tools including Builderbot, Moneybot, Managerbot and Buzz that automate code, marketing and operations.

“We built goose in early 2024 to work with any model because betting on a single lab means inheriting its ceiling. That led to us creating Builderbot to own orchestration across Block’s entire codebase, and in June, agentic AI helped write and review nearly all of our production code changes. Moneybot is generally available with over 1 million weekly engaged accounts and Managerbot is already automating marketing, margin analysis, and operational fixes for sellers. 5 In July we launched Buzz, our internally developed system for agent collaboration, communication, and code repositories, built to give teams of all sizes more time back, reduce coordination drag, and increase the speed at which we can ship and learn for customers.”

Block incorporates AI technologies including generative AI and AI agents into products and operations.

“We have incorporated and expect to continue to incorporate AI technologies, including generative AI and AI agents, into our products, internal operations and technologies. As AI technologies continue to evolve rapidly, new capabilities and associated risks may emerge that may be difficult to anticipate or address. Our use of AI depends in part on third-party large language models that we do not control, and these models may generate inaccurate, biased, hallucinated or unexpected outputs that conflict with our business objectives or brand standards.”

Rapid AI deployment and capable AI agents increase Block's operational, legal and reputational risks.

“Rapid deployment of AI technologies can increase operational, legal, and reputational risks. AI systems can fail, behave unexpectedly, or generate inaccurate or incomplete outputs due to insufficient testing, ineffective design, inadequate controls or other factors. Such failures can disrupt our operations, negatively affect customers or sellers, or otherwise adversely affect our business. As AI agents become increasingly capable of facilitating decisions or taking action on behalf of customers or sellers, errors, unintended actions or inappropriate recommendations generated by such systems can increase our operational, legal, or reputational risks.”

Block has made AI agents available under open source licenses, exposing it to risks.

“We regularly contribute software source code under open source and other permissive licenses and have made other technology we developed, such as AI agents, available under such licenses, and we include open source software in our products. Additionally, our AI services may be trained on data sets that may include open source software and the outputs of our AI services may be subject to open source license restrictions or obligations. As a result of our open source contributions and the use of open source software in our products, we may license or be required to license or disclose code and/or innovations that turn out to be material to our business and may also be exposed to increased litigation risk. If the protection of our proprietary rights is inadequate to prevent unauthorized use or appropriation by third parties, the value of our brands and other intangible assets may be diminished and competitors may be able to more effectively mimic our products, services, and methods of operations. Any of these events could have an adverse effect on our business and financial condition.”

Block expects to incorporate generative AI and AI agents into products and operations but risks inaccurate or biased outputs from third-party models.

“We have incorporated and expect to continue to incorporate AI technologies, including generative AI and AI agents, into our products, internal operations and technologies. Our use of AI depends on third-party large language models that we do not control, and these models may generate inaccurate, biased, hallucinated or unexpected outputs that conflict with our business objectives or brand standards.”

Open source contributions including AI agents may require licensing material code and increase litigation risk.

“We regularly contribute software source code under open source and other permissive licenses and have made other technology we developed, such as AI agents, available under such licenses, and we include open source software in our products. Additionally, our AI services may be trained on data sets that may include open source software and the outputs of our AI services may be subject to open source license restrictions or obligations. As a result of our open source contributions and the use of open source software in our products, we may license or be required to license or disclose code and/or innovations that turn out to be material to our business and may also be exposed to increased litigation risk. If the protection of our proprietary rights is inadequate to prevent unauthorized use or appropriation by third parties, the value of our brands and other intangible assets may be diminished and competitors may be able to more effectively mimic our products, services, and methods of operations. Any of these events could have an adverse effect on our business and financial condition.”

Block plans to invest in agentic AI infrastructure and proactive intelligence products.

“We’re executing well on our growth strategies across the business. At Investor Day we shared our preliminary view of gross profit for 2026, which called for 17% year-over-year gross profit growth. We now expect to deliver gross profit growth of 18% year over year in 2026, to $12.20 billion. We are focused on sustaining momentum and we plan to continue to invest in significant long term growth initiatives across our agentic AI infrastructure, proactive intelligence products, high ROI go to market expansion, Neighborhoods, and high return on capital lending products.”

Block is evolving to leaner AI-native teams as early builders of agentic AI tools.

“Our number one priority is product velocity. We are in a moment where AI is transforming how software products are built and changing the way we deliver value to our customers. As early builders of agentic AI tools, we’re choosing to evolve how our company operates to focus on leaner, AI-native teams that we believe are better aligned to take advantage of this shift. We believe this decision will strengthen innovation within the company and further improve our operating leverage over time.”

Block has made its developed AI agents available under open source licenses.

“We seek to protect our intellectual property rights by relying on a combination of federal, state, and common law rights in the United States and other countries, as well as on contractual measures. It is our practice to enter into confidentiality, non-disclosure, and invention assignment agreements with our employees and contractors, and into confidentiality and non-disclosure agreements with other third parties, in order to limit access to, and disclosure and use of, our confidential information and proprietary technology. In addition to these contractual measures, we also rely on a combination of trademarks, trade dress, domain names, copyrights, trade secrets, and patent rights to help protect our brand and our other intellectual property. Additionally, we regularly contribute software source code under open source and other permissive licenses and have made other technology we developed, such as AI agents, available under such licenses, and we include open source software in our products.”

Block incorporates AI technologies including generative AI and AI agents into its products.

“We have incorporated and expect to continue to incorporate AI technologies, including generative AI and AI agents, into our products and technologies. Our use of AI depends on third-party large language models that we do not control, and these models may generate inaccurate, biased, or unexpected outputs that conflict with our business objectives or brand standards.”

Block has made AI agents available under open source licenses and faces related IP and litigation risks.

“We regularly contribute software source code under open source and other permissive licenses and have made other technology we developed, such as AI agents, available under such licenses, and we include open source software in our products. Additionally, our AI services may be trained on data sets that may include open source software and the outputs of our AI services may be subject to open source license restrictions or obligations. As a result of our open source contributions and the use of open source software in our products, we may license or be required to license or disclose code and/or innovations that turn out to be material to our business and may also be exposed to increased litigation risk. If the protection of our proprietary rights is inadequate to prevent unauthorized use or appropriation by third parties, the value of our brands and other intangible assets may be diminished and competitors may be able to more effectively mimic our products, services, and methods of operations. Any of these events could have an adverse effect on our business and financial condition.”

Block incorporates generative AI and AI agents into products but depends on third-party large language models.

“We have incorporated and expect to continue to incorporate AI technologies, including generative AI and AI agents, into our products and technologies. Our use of AI depends on third-party large language models that we do not control, and these models may generate inaccurate, biased, or unexpected outputs that conflict with our business objectives or brand standards.”

Block has made its developed AI agents available under open source licenses, exposing it to litigation and other risks.

“We regularly contribute software source code under open source and other permissive licenses and have made other technology we developed, such as AI agents, available under such licenses, and we include open source software in our products. Additionally, our AI services may be trained on data sets that may include open source software and the outputs of our AI services may be subject to open source license restrictions or obligations. As a result of our open source contributions and the use of open source software in our products, we may license or be required to license or disclose code and/or innovations that turn out to be material to our business and may also be exposed to increased litigation risk. If the protection of our proprietary rights is inadequate to prevent unauthorized use or appropriation by third parties, the value of our brands and other intangible assets may be diminished and competitors may be able to more effectively mimic our products, services, and methods of operations. Any of these events could have an adverse effect on our business and financial condition.”

Block launched Square AI leveraging its AI agent codename goose for sellers.

“In the second quarter, we also launched Square AI to give sellers instant, data-driven answers to their business questions. Leveraging our AI agent, codename goose, and powered by Square data, this tool is available directly in the Square Dashboard and it helps sellers work smarter and faster. Through a conversational interface, sellers can explore sales trends, top-selling items by time of day, customer spending patterns, and more. It’s the start of a broader push to bring powerful AI tools to our sellers.”

Block contributes AI agents under open source licenses exposing it to litigation risk.

“We regularly contribute software source code under open source and other permissive licenses and have made other technology we developed, such as AI agents, available under such licenses, and we include open source software in our products. Additionally, our AI services may be trained on data sets that may include open source software and the outputs of our AI services may be subject to open source license restrictions or obligations. As a result of our open source contributions and the use of open source software in our products, we may license or be required to license or disclose code and/or innovations that turn out to be material to our business and may also be exposed to increased litigation risk. If the protection of our proprietary rights is inadequate to prevent unauthorized use or appropriation by third parties, the value of our brands and other intangible assets may be diminished and competitors may be able to more effectively mimic our products, services, and methods of operations. Any of these events could have an adverse effect on our business and financial condition.”

Block faces risks from open source contributions including AI agents and use of open source in AI services.

“We regularly contribute software source code under open source and other permissive licenses and have made other technology we developed, such as AI agents, available under such licenses, and we include open source software in our products. Additionally, our AI services may be trained on data sets that may include open source software and the outputs of our AI services may be subject to open source license restrictions or obligations. As a result of our open source contributions and the use of open source software in our products, we may license or be required to license or disclose code and/or innovations that turn out to be material to our business and may also be exposed to increased litigation risk. If the protection of our proprietary rights is inadequate to prevent unauthorized use or appropriation by third parties, the value of our brands and other intangible assets may be diminished and competitors may be able to more effectively mimic our products, services, and methods of operations. Any of these events could have an adverse effect on our business and financial condition.”

Block partners with Anthropic on Model Context Protocol for AI Agents.

“We believe that by building for and on open-source systems and protocols we will increase trust, customer flexibility, and global adoption. This will underlie all of our work, but will show up most obviously in our platform and bitcoin initiatives, our bitkey non-custodial wallet, and Proto, our open bitcoin mining system. We expect to deliver our first mining chips this year and we are building the infrastructure to scale faster, investing in next generation chip design and mining systems. We are excited to actively partner with Anthropic and the broader open source community on Model Context Protocol, which we believe has the potential to be the foundational open protocol for AI Agents.”

Block launched open-source on-machine AI agent codename goose for engineering tasks.

“Our number one initiative on our strategic roadmap to get all of this done is to invest heavily in building applied AI tools to remove the toil of mechanical tasks for both ourselves across our entire business and for our customers across all of our product surfaces . Earlier this year we launched “codename goose,” an open source on-machine AI agent that automates most engineering tasks and helps reduce maintenance and repetitive work. It works on top of any LLM, cloud or local, and is entirely extensible so people and companies can customize it to their needs. Goose’s unique design, which allows it to backtrack and try multiple approaches, has already increased our own productivity and efficiency and we believe it has utility for every discipline outside of engineering. We have the potential for many projects like “codename goose” and we expect our new functionalized engineering structure will unlock all of this creative energy. The best engineers want to work where the most exciting technologies are being developed and we believe leading in AI agent innovation will help us attract world class talent.”