BLOCK Investment & Profitability Ecosystem Overview

BLOCK 65 Square Margins - Reconciliation to GAAP Variable expenses are investments that we incur to drive the next dollar of gross profit growth, and these typically scale with gross profit. These include discretionary expenses such as sales & marketing investments and teams, customer success teams, as well as non-discretionary expenses such as risk loss. Fixed expenses are investments that may drive longer-term growth, and generally do not scale with an additional dollar of gross profit. These include expenses such as our product and general & administrative teams, professional fees incurred, and corporate overhead expenses such as rent & facilities. ($ in thousands) Square gross profit Variable expenses 2018 2019 2020 2021 1,072,496 1,390,427 1,507,831 2,316,671 Less: Transaction, loan, and advance losses 80,248 112,224 Less: Marketing expenses (marketing expense, partnership fees, hardware marketing, onboarding costs) Less: Variable personnel expenses (sales & marketing personnel, contractor personnel, travel & entertainment) Less: Cloud storage and processing 114,924 148,530 131,975 199,111 61,188 308,665 116,334 134,573 165,763 255,210 32,037 39,100 51,715 72,479 Less: Taxes and licenses 11,426 19,235 20,437 18,334 Total variable expenses 354,969 453,662 569,001 715,876 Square gross profit less variable expenses Square structural margin (% of Square gross profit) Fixed expenses 717,527 936,765 938,830 1,600,795 67% 67% 62% 69% Less: Fixed personnel expenses (G&A and product development personnel) Less: Professional fees and subscriptions (including add backs for acquisitions) Less: Facilities expenses Total fixed expenses Square gross profit less variable and fixed expenses Square adjusted fully burdened profit margin (% of Square gross profit) 575,746 118,373 122,203 816,322 784,473 34%

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