Shopify vs Block: Which Commerce Platform Deserves Your Capital?

Shopify's $9.3 billion in revenue represents a 28% CAGR from the $4.6 billion posted in 2021. That growth has come while simultaneously improving profitability — net income turned positive at $1.3 billion in FY2025 after years of losses. The company powers over 4 million merchants globally, from single-person Etsy alternatives to enterprise brands like Gymshark and Allbirds.

The real signal in Shopify's data is the take rate — the percentage of merchant GMV that Shopify captures through payments, shipping, and capital products. That rate has been steadily increasing from 2.5% to over 3.2% as merchants adopt more Shopify services. On $250+ billion in GMV, each 10 basis point increase in take rate adds $250 million in revenue.

Shopify's stock has been trending higher, and the market sees it clearly: a software company transitioning into a payments company, capturing more value from each transaction. The multiple of 12x forward revenue is elevated but defensible for a business growing 25%+ with improving margins.

Block's $24.1 billion in revenue dwarfs Shopify's — but the comparison is misleading. Block's revenue includes Bitcoin revenue from Cash App, which accounted for roughly $10 billion but carried negligible gross profit. Strip out Bitcoin, and Block's core commerce and financial services revenue is roughly $14 billion, growing at a more modest 15%.

Block operates two interconnected ecosystems: Square (merchant payments, point-of-sale, banking) and Cash App (consumer payments, investing, Bitcoin). The thesis has always been that connecting merchant and consumer ecosystems creates a closed-loop payment network that competes with Visa and Mastercard. The execution, however, has been uneven.

Cathie Wood's continued bullishness on Block — through the ARK funds — reflects conviction in the Cash App monetisation story and Bitcoin integration. Wood's recent comments about portfolio diversification and the gold standard reset suggest a macro thesis that benefits Block's Bitcoin holdings. But conviction from a high-profile investor isn't the same as fundamental execution.

Growth trajectory: Shopify at 25%+ versus Block at 15% (ex-Bitcoin). Clear advantage Shopify. The commerce platform model with rising take rates has more structural growth ahead than Block's mature payment processing business.

Profitability: Shopify reached $1.3 billion in net income in FY2025 — a dramatic improvement from the losses of 2022-2023. Block's net income of $0.27 billion in FY2025 is thin for a $24 billion revenue company, reflecting ongoing investment in Cash App and Bitcoin infrastructure. Advantage Shopify by a wide margin.

Competitive moat: Shopify's merchant switching costs are high — migrating an online store with product catalogues, customer data, and integrated apps is painful. Block's payment processing has lower switching costs — a merchant can swap Square for another terminal relatively easily. Advantage Shopify.

TAM expansion: Shopify is pushing into B2B commerce, enterprise, and international markets. Block is expanding Cash App into lending, savings, and tax filing. Both have large expansion opportunities, but Shopify's commerce infrastructure TAM ($800 billion+ globally) exceeds Block's fintech TAM ($300-400 billion in the US). Slight advantage Shopify.

Valuation: Shopify at $115 billion (12x forward revenue) versus Block at $30 billion (roughly 4x forward revenue adjusted for Bitcoin). Block is dramatically cheaper. But cheaper doesn't mean better value — it often reflects the market correctly pricing lower growth and weaker unit economics.