XYZ & PYPL 2Q Preview

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XYZ & PYPL 2Q Preview

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Payments, Processors & IT Services

Earnings Preview

Guidance vs. M&A Takes Center Stage 22 July 2026

We preview 2Q earnings for Block (Buy-rated, $100 PO) and PayPal (Not Rated) with Equity

investor attention focused on two very different narratives. For Block, the key debate United States

centers on whether management can continue raising expectations as operating Payments, Processors & IT Services

efficiency initiatives gain traction and AI driven productivity benefits increasingly flow Matthew C. O'Neill

through the P&L. Following a strong move in the shares since last earnings, we believe Research Analyst

investors are looking beyond quarterly beats and focusing more heavily on the potential BofAS+1 646 855 1681

for another upward revision to FY guidance. For PayPal, however, the conversation is matthew.c.oneill@bofa.com

likely to be dominated by the recently reported acquisition interest from Stripe and Mihir Bhatia

Research Analyst

Advent, with any updates regarding this process likely to far outweigh any modest over BofAS

or underperformance in quarterly fundamentals. +1 415 436 3553

mihir.bhatia@bofa.com

Execution Remains the Primary Debate for Block CarolineResearch AnalystLatta

We continue to view Block as well positioned heading into the quarter, supported by BofAS

caroline.latta@bofa.com

healthy operating trends across both Square and Cash App as well as ongoing execution

Lawrence Aydlett

against margin expansion initiatives. Key areas of focus will include the relationship Research Analyst

between Square GPV and gross profit growth, management's assessment of consumer BofAS lawrence.aydlettjr@bofa.com

spending trends, and transaction loss performance as Borrow enters more difficult

Natalie Howe