Block drives margin growth with AI and cost cuts, targets 15%+ growth and 29.4% margins in 2026

Block, Inc. is aggressively cutting costs and adopting AI to boost margins while maintaining strong revenue growth and a solid balance sheet. The company plans a 40% workforce reduction and expects adjusted operating margins to reach 29.4% by year-end, targeting mid-teens revenue growth. Despite risks like lending cyclicality and competition, its current valuation at 15x earnings and potential for multiple expansion make it a compelling buy. Analyst Julian Lin reiterates a "Strong Buy" rating, highlighting the stock's undervaluation and growth potential through 2026.