A BNPL Bubble Is Actually Why I'm Bullish, For Now

BNPL is growing and inflating at an increasing rate. From concert tickets to burritos, everyone is using buy now pay later. The global market is projected to hit 560 billion dollars in 2025, up from around 492 billion in 2024, and climb to 912 billion by 2030 at a compounding growth rate of 10.2%. Just in the U.S. alone, demand is expected to reach 122 billion next year and scale to 184 billion by the end of the decade. The trajectory is steep, with the structural weaknesses already showing.

Block is positioned at the center of BNPL. In Q1 2025 they reported:

2.29 billion in gross profit, up 9 percent YoY

466 million in adjusted operating income, up 28%

10.3 billion in GMV through Afterpay, with 298 million in BNPL gross profit, up 23% YoY

The stock took a hit. It dropped 9 percent in February and another 21 percent after missing Q1 earnings, but this is seen as typical early bubble behavior. There is short term fear but continuing growth and acceleration. Klarna’s credit losses, IPO delays, and regulatory friction are not problems, they are actually signals that the sector is growing faster than the market, or quite frankly, anyone can control.

BNPL is becoming the default credit system for younger consumers. It is overused and expanding too fast. That is the formula for both upside and implosion. However with that, timing will be everything here, and knowing when to close will be crucial if BNPL can't stabilize.

Baseline expectation: SQ trades in the 80 to 90 range in the short term
Midterm upside:120 by 2027
Long-term target: 180 to 220 if BNPL stabilizes and Block captures its runway