Block Q1: I Believe Dorsey (Upgrade)

I'm upgrading Block to a Buy after Q1 earnings, reversing my November skepticism, on Cash App's stronger-than-expected growth and Dorsey's company-wide AI restructuring bet. Block beat on non-GAAP EPS and revenue, with adjusted EBITDA crossing $1B for the first time, but posted a sharp net income loss tied to layoffs. Cash App is the standout: primary banking actives grew 18% YoY to 9.7M, and inflows per active rose 10%, driven by direct deposit capture.