Block vs Microsoft: Revenue, Profit and Business Model
Block reported $24.2B of revenue in FY2025 and $1.3B of net income. Microsoft reported $331.8B of revenue in FY2026 and $133.7B of net income.
Latest financial snapshot
Financial summary
Block
Revenue was nearly flat in 2025, $24.19 billion against $24.12 billion, because bitcoin sales fell from $10.36 billion to $8.50 billion. Gross profit, which strips out the cost of the bitcoin Block resells, rose 17% to $10.36 billion and adjusted operating income rose 30% to about $2.3 billion. Net income attributable to common stockholders was $1.31 billion, down from $2.90 billion in 2024, a year lifted by a large fourth-quarter tax benefit. 2026 opened with a $308.7 million first-quarter net loss as layoff costs landed (about $495 million of restructuring charges across the first half), then second-quarter gross profit grew 25% to $3.17 billion with a record 27% adjusted operating margin. Block now guides to $12.51 billion of 2026 gross profit and $3.47 billion of adjusted operating income. It bought back $2.3 billion of stock in 2025, had $4.6 billion of repurchase authorization left at June 30, 2026, and pays no dividend.
Microsoft
Microsoft's FY2026 revenue rose 17.8% to $331.8 billion, operating income rose 21% to $155.2 billion, and GAAP net income rose 31% to $133.7 billion. Fourth-quarter revenue was $90.0 billion (up 18%) with net income of $35.8 billion, helped by a $3.2 billion gain on its Anthropic investment. Microsoft Cloud revenue reached $59.3 billion in Q4, up 27%. The main pressure point is capital intensity: AI data center spending has pushed free cash flow growth well below earnings growth.
Revenue and profit by year
Block
| Year | Revenue | Net income | Margin | Growth | Source |
|---|---|---|---|---|---|
| FY2025 | $24.2B | $1.3B | 5.4% | +0.3% | Source |
| FY2024 | $24.1B | $2.9B | 12.0% | +10.1% | Source |
| FY2023 | $21.9B | $9.8M | 0.0% | +25.0% | Source |
| FY2022 | $17.5B | -$541M | -3.1% | -0.7% | Source |
| FY2021 | $17.7B | $166M | 0.9% | +85.9% | Source |
| FY2020 | $9.5B | $213M | 2.2% | +101.5% | Source |
| FY2019 | $4.7B | $375M | 8.0% | +42.9% | Source |
| FY2018 | $3.3B | -$38M | -1.2% | +49.0% | Source |
| FY2017 | $2.2B | -$63M | -2.8% | +29.5% | Source |
| FY2016 | $1.7B | -$172M | -10.1% | — | Source |
Microsoft
| Year | Revenue | Net income | Margin | Growth | Source |
|---|---|---|---|---|---|
| FY2026 | $331.8B | $133.7B | 40.3% | +17.8% | Source |
| FY2025 | $281.7B | $101.8B | 36.1% | +14.9% | Source |
| FY2024 | $245.1B | $88.1B | 36.0% | +15.7% | Source |
| FY2023 | $211.9B | $72.4B | 34.1% | +6.9% | Source |
| FY2022 | $198.3B | $72.7B | 36.7% | +18.0% | Source |
| FY2021 | $168.1B | $61.3B | 36.5% | +17.5% | Source |
| FY2020 | $143B | $44.3B | 31.0% | +13.6% | Source |
| FY2019 | $125.8B | $39.2B | 31.2% | +14.0% | Source |
| FY2018 | $110.4B | $16.6B | 15.0% | +14.3% | Source |
| FY2017 | $96.6B | $25.5B | 26.4% | — | Source |
Where the revenue comes from
Block
- Commerce enablement revenue47.6%
$11.51 billion in 2025: Square payment processing, software and hardware for sellers, plus Afterpay.
- Financial solutions revenue17.3%
$4.18 billion in 2025: Cash App Card interchange, instant transfer fees, Borrow and Square Loans, and banking products. It is the fastest-growing line and carries high margins.
- Bitcoin ecosystem revenue35.1%
$8.50 billion in 2025, down from $10.36 billion in 2024. Bitcoin sold to Cash App customers is booked at full value, so gross profit is small: $72 million in the second quarter of 2026.
Microsoft
- Productivity And Business ProcessesMajor
Office, Microsoft 365, LinkedIn, Dynamics, and related cloud services.
- Intelligent CloudMajor
Azure, server products, enterprise services, and cloud infrastructure.
- More Personal ComputingMajor
Windows, devices, gaming, search, and advertising.
- AI Services And CopilotsGrowth
AI features and model-powered services embedded across Azure, Microsoft 365, GitHub, security, and developer tools.
Business model and strategy
Block
How it makes money
Block runs a two-sided network. On the seller side, Square charges a fee on each card payment (in the U.S. on its free plan, 2.6% plus 15 cents in person and 3.3% plus 30 cents online) and adds paid software, hardware, payroll, banking and Square Loans. On the consumer side, basic Cash App transfers are free;
Growth strategy
Block's 2026 plan has four parts. Square is selling to larger and international sellers through a field sales team and independent sales organization partners; international GPV grew 28% in the second quarter of 2026. Cash App wants to be the main bank account for people with several income sources, using direct deposit and Cash App Green rewards status;
Competitive advantage
Block's advantage is owning both ends of many small transactions. Cash App's peer-to-peer network spreads by itself, since receiving money means downloading the app, and every added product (the Cash App Card, direct deposit, Borrow, Afterpay) raises revenue per customer without new acquisition cost.
Microsoft
How it makes money
Microsoft reports three segments. Intelligent Cloud covers Azure, SQL Server, Windows Server, GitHub, Nuance, and enterprise services; server products and cloud services alone brought in $129.4 billion in FY2026, and Azure passed $100 billion in annual revenue for the first time.
Growth strategy
Microsoft's growth plan centers on AI capacity and AI subscriptions. It is spending heavily on data centers and chips to meet Azure demand that management says remains capacity constrained, and it is selling Microsoft 365 Copilot as a paid add-on, which passed 30 million paid seats by the end of FY2026.
Competitive advantage
Microsoft's main advantage is distribution inside enterprises. Identity (Entra), email and documents (Microsoft 365), collaboration (Teams), developer tools (GitHub, Visual Studio), and cloud infrastructure (Azure) are often bought together, which raises switching costs and lets Microsoft attach new products such as Copilot to existing contracts.
Questions about Block vs Microsoft
Which company has higher revenue — Block Inc or Microsoft Corporation?
Block Inc reported $24.2B (FY2025), while Microsoft Corporation reported $331.8B (FY2026). By last reported revenue, Microsoft Corporation is the larger business, with Block Inc reporting a smaller revenue base. Note: these are from different fiscal years and are not a direct like-for-like comparison.
What is the market cap of Block Inc vs Microsoft Corporation?
Block Inc's market capitalisation stands at $44.5B, while Microsoft Corporation's is $3.83T. Microsoft Corporation carries the higher market valuation, reflecting investors' expectations of its future earnings power relative to Block Inc.
Which is more financially efficient — Block Inc or Microsoft Corporation?
Block Inc generates $2.37M / employee in revenue per employee, while Microsoft Corporation generates $1.49M / employee. Block Inc shows higher revenue efficiency per headcount, though this reflects business model differences — capital-light software companies routinely outperform labour-intensive manufacturers on this metric.
How do Block Inc and Microsoft Corporation make money?
Block Inc and Microsoft Corporation generate revenue in fundamentally different ways. Block Inc: Block runs a two-sided network. Microsoft Corporation: Microsoft reports three segments.
Which company is valued higher relative to revenue — Block Inc or Microsoft Corporation?
On a price-to-sales (P/S) basis, Block Inc trades at 1.8x P/S and Microsoft Corporation at 11.5x P/S. Microsoft Corporation commands a higher revenue multiple, typically indicating that investors expect faster growth or higher future margins compared to Block Inc. A higher multiple is not inherently better — it may also signal that the stock is priced for perfection.
Is Block Inc bigger than Microsoft Corporation?
By last reported revenue, Microsoft Corporation ($331.8B (FY2026)) is the larger company compared to Block Inc ($24.2B (FY2025)). Revenue scale is one dimension of size — market capitalisation, employee count, and geographic reach are also relevant depending on the context.
Figures come from each company's filings and the sources linked beside them. Amounts reported in another currency are shown in US dollars at an approximate rate and marked with ~. Back to the Block vs Microsoft overview