Block Inc., the fintech company formerly known as Square, is set to join the S&P 500 index, replacing Hess Corp., which was recently acquired by Chevron.
The announcement, made late Friday by S&P Dow Jones Indices, triggered an immediate investor reaction—Block’s shares surged over 10% in after-hours trading, closing at $80.88.
This development marks one of two sudden index changes this week, the other being The Trade Desk’s addition following Synopsys’ acquisition of Ansys. Block’s inclusion will officially take effect before markets open on Wednesday, July 23.
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Founded by Jack Dorsey in 2009, Square changed its name to Block in 2021 to emphasize its focus on blockchain technologies.
Why Block Was Picked
Despite earlier expectations that Robinhood or AppLovin—both boasting higher market capitalizations of $93 billion and $120 billion, respectively—would be selected, S&P Dow Jones opted for Block. Analysts believe the decision was influenced by sector balancing and Block’s unique positioning in digital payments and cryptocurrency, a combination that diversifies the index’s tech weight.
Block has a current market cap nearing $45 billion, well above the S&P 500’s eligibility floor. Until Friday’s announcement, its shares had been down around 14% year-to-date, weighed by investor caution over consumer spending and broader economic uncertainty.
In May, Block reported first-quarter results that missed Wall Street expectations on Thursday and issued a disappointing outlook, leading to a plunge in the stock price. Block’s forecast for the second quarter and full year reflected challenging economic conditions that followed sweeping tariff announcements by President Donald Trump.
“We recognize we are operating in a more dynamic macro environment, so we have reflected a more cautious stance on the macro outlook into our guidance for the rest of the year,” the company wrote in its quarterly report.
But the index inclusion has reversed that sentiment, triggering buying pressure from index-tracking funds that must now add Block to their portfolios.
A Crypto-Driven Differentiator
Beyond fintech, Block brings a bold and unique edge to the S&P 500—Bitcoin. The company holds substantial Bitcoin assets and has committed to reinvesting 10% of its monthly Bitcoin gross profits back into BTC. VanEck analysts say this makes Block potentially the first S&P 500 company with a formal Bitcoin accumulation strategy.
While Tesla and MicroStrategy are known for their Bitcoin holdings, Block’s methodical reinvestment signals a structured crypto commitment. Market analysts note that Block’s Bitcoin integration could pave the way for broader institutional exposure to digital assets via mainstream index funds.
The Index Effect and Market Expectations
Inclusion in the S&P 500 typically boosts a company’s visibility, credibility, and liquidity. Institutional investors who mirror the index will be compelled to buy Block shares, further fueling demand. However, analysts caution that such spikes often cool down after initial inflows, and longer-term performance will depend on fundamentals.
Block has its next earnings report scheduled for August 7. Investors will be watching closely to see if its Q2 performance justifies the market’s renewed optimism. The company has faced a mixed economic environment, with macroeconomic headwinds including tariffs and spending slowdowns, particularly under ongoing policies from the Trump administration.
Robinhood Left Waiting—Again
Robinhood’s exclusion, despite qualifying on market cap and liquidity grounds, has drawn attention. The company has previously missed out on index inclusion due to profit volatility, and this latest snub is likely another blow for its institutional appeal. AppLovin, another expected contender, was also bypassed.
S&P’s choices reflect a nuanced balancing act that factors in industry exposure, index composition, and long-term growth outlook—areas where Block’s integration of payments, commerce, and crypto seem to offer a stronger match.
Block’s entry into the S&P 500 is a milestone—not just for the company, but for the broader acceptance of fintech and crypto in traditional financial benchmarks. The stock’s double-digit surge underscores investor excitement, but the true test will come in its upcoming earnings and ability to sustain momentum.
