Block, Inc. · NYSE:XYZ

Block — Investor Day (May 2022)

35 slides from Block's investor day presentation, May 2022

  1. Slide 1: Market Opportunity

    Investor Day 2022 Market Opportunity → Amrita Ahuja INVESTOR DAY 2022

  2. Slide 2: Forward looking statements

    BLOCK MARKET OPPORTUNITY → 2 Forward looking statements During the course of this Investor Day, the executive team of Block, Inc. (the “Company”, “we”, or “our”) will make forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the S

  3. Slide 3: We started Square with the idea of allowing small businesses to accept card payments

    BLOCK MARKET OPPORTUNITY → 3 We started Square with the idea of allowing small businesses to accept card payments Square Cash App Square Reader Payments 2010 Products shown are illustrative and may not correspond to the exact period launched. INVESTOR DAY 2022

  4. Slide 4: We went public in 2015 with a more fulsome product set

    BLOCK MARKET OPPORTUNITY → 4 We went public in 2015 with a more fulsome product set to allow sellers to start, run, and grow their business Square Cash App Point of Sale Square Loyalty Square Directory Canada Square Stand Japan Square Loans Square Invoices Appointments Analytics App Marketplace Gift

  5. Slide 5: In 2017, we continued building upon Square's ecosystem and began to expand Cash App

    BLOCK MARKET OPPORTUNITY → 5 In 2017, we continued building upon Square’s ecosystem and began to expand Cash App Square Cash App Australia eCommerce API POS API Virtual Terminal Square for Retail UK Square Register Point of Sale Point of Sale Square Loyalty Square Loyalty Square Directory Square Dir

  6. Slide 6: Three years later, Cash App unlocked a completely new ecosystem

    BLOCK MARKET OPPORTUNITY → 6 Three years later, we saw Cash App unlocked a completely Square for Restaurants new ecosystem serving a Reader SDK Square Installments different customer base Square Terminal In-App Payments SDK Square Card Square Online Store Order Management Square Photo Studio Square

  7. Slide 7: We've grown our ecosystems and expanded the audiences we serve

    BLOCK MARKET OPPORTUNITY → 7 Square Messages Ireland We’ve grown our Subscriptions API France Spain ecosystems and expanded BNPL as payment method Square for Restaurants Square for Restaurants Reader SDK the audiences we serve Reader SDK Square Installments Square Installments Square Terminal Square

  8. Slide 8: Strong growth at scale

    BLOCK 8 Strong growth at scale Gross Profit >50% CAGR over the past five years Caviar gross profit has been excluded for all periods. CAGR represents the compound annual gross profit growth rate from 2017 to 2021. See the Appendix on page 29 for non-GAAP and other reconciliations. INVESTOR DAY 2022

  9. Slide 9: While also driving profitable growth

    BLOCK 9 While also driving profitable growth Net Income Adjusted EBITDA (Loss) Net income (loss) is presented on a non-GAAP basis and excludes gain on Caviar sale and all equity investments (both gains and losses). See the Appendix starting on page 29 for non-GAAP and other reconciliations. INVESTOR

  10. Slide 10: Strong growth + margin profile

    BLOCK 10 Strong growth + margin profile Adjusted EBITDA margin is defined as Adjusted EBITDA as a percent of gross profit for a given time period. See the Appendix starting on page 29 for non-GAAP and other reconciliations. INVESTOR DAY 2022

  11. Slide 11: Expanding our addressable market over time

    BLOCK MARKET OPPORTUNITY → 11 Expanding our addressable $120B market over time 2022 2020 $100B 2022 $70B 2020 $60B 2017 $60B 2017 2015 2015 2010 Cash App Square Previous Addressable Market estimates were provided in prior Block Investor Day materials. 2022 Addressable Market was sized on a gross pro

  12. Slide 12: Square represents a ~$120B gross profit opportunity

    BLOCK MARKET OPPORTUNITY → 12 SQUARE Square represents a ~$120B gross profit opportunity $ 81 B+ $ 16 B+ $ 25 B+ U.S. Commerce U.S. Banking International $ 120 Opportunity + B Integrated Payments Square Loans Integrated Payments Software Financial Services Software Financial Services Sources: Square

  13. Slide 13: With SMB and mid-market sellers representing an attractive target opportunity

    BLOCK MARKET OPPORTUNITY → 13 SQUARE With SMB and mid-market sellers representing an attractive target opportunity Seller Size U.S. Sellers U.S. Gross Receipts (Gross Receipts) Enterprise $100M+ 25K $8.5T $20M – $100M 51K $1.7T Mid-Market $1M – $20M 1.0M $3.7T SMB $250K – $1M 2.9M $1.3T Micro <$250K

  14. Slide 14: Less than 1% penetrated in the mid-market segment today

    BLOCK MARKET OPPORTUNITY → 14 SQUARE Less than 1% penetrated in the mid-market segment today 2021 gross receipts as % of addressable opportunity 0.5% 13% 4% Micro SMB Mid-Market Sources: Square internal company data, 2017 U.S. Census, U.S. Bureau of Labor Statistics. Seller sizes from the U.S. Censu

  15. Slide 15: Multiple strategies to expand addressable market

    BLOCK MARKET OPPORTUNITY → 15 SQUARE Multiple strategies to expand Global expansion addressable market Financial services Growing upmarket Enhancing omnichannel capabilities $ 120 B+ Circles are illustrative of opportunities to expand addressable market, but are not proportional or to scale. INVESTO

  16. Slide 16: Cash App represents a ~$70B gross profit opportunity in the U.S.

    BLOCK MARKET OPPORTUNITY → 16 CASH APP Cash App represents a ~$70B gross profit opportunity in the U.S. $ 28 + $ 40 + $ 3 + 70 + B B B $ Community (P2P) Financial Services Bitcoin B (Consumer Trading) Opportunity Business accounts Cash App Card Instant Deposit Buying and selling bitcoin Sources: Cash

  17. Slide 17: Opportunity to expand on strong growth with digital natives

    BLOCK MARKET OPPORTUNITY → 17 CASH APP Opportunity to expand ~260M Potential Customers on strong growth with digital natives U.S. Age Mean Cash App Cash App Population Income % of Monthly Actives % of Inflows Generation Z ~56M 13 – 25 $39K 34% 27% Millennials ~72M 26 – 41 $85K 38% 44% Generation X ~6

  18. Slide 18: Opportunity to expand on strong growth with digital natives

    BLOCK MARKET OPPORTUNITY → 18 CASH APP Opportunity to expand ~260M Potential Customers on strong growth with digital natives U.S. Age Mean Cash App Cash App Population Income % of Monthly Actives % of Inflows Generation Z ~56M 13 – 25 $39K 34% 27% Millennials ~72M 26 – 41 $85K 38% 44% Generation X ~6

  19. Slide 19: Reaching less than 20% of the U.S. population today

    BLOCK MARKET OPPORTUNITY → 19 CASH APP Reaching less than 20% of the U.S. population today Cash App monthly actives with demographic data (% of U.S. population) 20% 17% 10% 4% Gen Z Millennials Gen X Baby Boomers Represents Cash App monthly actives as of 3/31/22 as a percentage of the U.S. populatio

  20. Slide 20: Multiple strategies to expand our addressable market

    BLOCK MARKET OPPORTUNITY → 20 CASH APP Multiple strategies to expand our Global addressable market Bitcoin Credit Commerce Engagement $ 70 B+ Circles are illustrative of opportunities to expand addressable market, but are not proportional or to scale. INVESTOR DAY 2022

  21. Slide 21: Investing in emerging ecosystems with meaningful long-term potential

    BLOCK MARKET OPPORTUNITY → 21 TIDAL BITCOIN Investing in emerging ecosystems with meaningful long-term potential Creators Consumers Bitcoin Developers Bitcoin Bitcoin TIDAL TBD Spiral Wallet Mining INVESTOR DAY 2022

  22. Slide 22: TIDAL ecosystem

    BLOCK MARKET OPPORTUNITY → 22 TIDAL TIDAL ecosystem 0.1 M creators had at least 650 streams on TIDAL in March ~2 M creators had at least one stream on TIDAL in March ~7M creators have uploaded a song to TIDAL ~500 M+ global music streaming subscribers Source: Global music streaming subscribers data

  23. Slide 23: Creator ecosystem

    BLOCK MARKET OPPORTUNITY → 23 TIDAL Creator ecosystem 0.1 M creators had at least 650 streams on TIDAL in March ~2 M creators had at least one stream on TIDAL in March ~7M creators have uploaded a song to TIDAL ~500 M+ global music streaming subscribers Source: Global music streaming subscribers dat

  24. Slide 24: Bitcoin ecosystem

    BLOCK 24 BITCOIN Bitcoin ecosystem We see meaningful long-term potential in the growth and value of bitcoin Bubble size represents relative current market cap Sources: Forbes, Cointelegraph, Federal Reserve, United States Mint, World Bank, Coin Metrics, and Capital IQ. For further information please

  25. Slide 25: Bitcoin ecosystem: wallet and mining

    BLOCK MARKET OPPORTUNITY → 25 BITCOIN Bitcoin ecosystem: wallet and mining Wallet Mining 225%+ YoY Growth 240%+ YoY Growth Global Bitcoin Owners Global Bitcoin Mining Revenue 2021 2021 2020 $17B 2020 176M $5B 54M Sources: Global bitcoin owners data from Crypto.com as of December 2020 and December 20

  26. Slide 26: Bitcoin ecosystem: TBD

    BLOCK MARKET OPPORTUNITY → 26 BITCOIN Bitcoin ecosystem: TBD Enable decentralized Cheaper and faster Value-added services identity remittances at scale on decentralized exchange Established identity and access to global financial services without any limit to geo or reach ~1B Global remittance users

  27. Slide 27: Our ecosystems become more powerful as we build connections between them

    BLOCK 27 Our ecosystems become more powerful as we build connections between them INVESTOR DAY 2022

  28. Slide 28: Investment thesis

    BLOCK MARKET OPPORTUNITY —+ 28 Investment thesis Each ecosystem with multiple vectors for growth Differentiated ecosystem of ecosystems approach Operating model built to drive continued innovation 6) Strong cohort economics driving attractive long-term returns

  29. Slide 29: Appendix

    BLOCK MARKET OPPORTUNITY → Market Opportunity Appendix INVESTOR DAY 2022

  30. Slide 30: Appendix

    BLOCK MARKET OPPORTUNITY → 30 Appendix Slide 12: “U.S. Commerce” gross profit opportunity is a combination of U.S. Payments, U.S. ACH, and SaaS opportunities. U.S. Payments opportunity is calculated by aggregating the gross receipts of U.S. businesses and adjusting for Square’s addressable industries

  31. Slide 31: Appendix

    BLOCK MARKET OPPORTUNITY → 31 Appendix Slide 16: “Community (P2P)” gross profit opportunity is calculated based on the approximate gross profit percentage of Cash App’s Community (P2P) volume opportunity. The Community (P2P) volume opportunity is calculated based on U.S. Census data on adult populatio

  32. Slide 32: Appendix

    BLOCK MARKET OPPORTUNITY → 32 Appendix Slide 24: “Bitcoin ecosystem” market opportunity further information and sources: Gold current market cap and years to $1 trillion market cap data from Forbes as of December 2021 and Cointelegraph (February 2021). U.S. Currency in Circulation current market cap

  33. Slide 33: Reconciliations

    BLOCK MARKET OPPORTUNITY → 33 Reconciliations Discussion of financial results excluding Caviar (in thousands) ($ in thousands, unaudited) 2015 2016 2017 2018 2019 2020 2021 Total gross profit 345,195 576,038 839,306 1,303,700 1,889,685 2,733,409 4,419,823 Less: Caviar contribution to total gross profit

  34. Slide 34: Reconciliations

    BLOCK MARKET OPPORTUNITY → 34 Reconciliations Adjusted EBITDA (in thousands) ($ in thousands, unaudited) 2017 2018 2019 2020 2021 Net income (loss) attributable to common stockholders (62,813) (38,453) 375,446 213,105 166,284 Net loss attributable to noncontrolling interests (7,458) Net income (loss

  35. Slide 35: Reconciliations

    BLOCK MARKET OPPORTUNITY → 35 Reconciliations Net income (loss) (in thousands) ($ in thousands, unaudited) 2015 2016 2017 2018 2019 2020 2021 Net income (loss) (179,817) (171,590) (62,813) (38,453) 375,446 213,105 158,826 Net income (loss) attributable to noncontrolling interest - TIDAL (7,458) Net

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