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block The stock rose about 8% in expansion trading after the payments firm reported fourth-quarter earnings that missed Wall Street expectations but posted strong gross margin growth.
Here’s a comparison between Block and the Refinitiv consensus expectations:
- EPS: 22 cents, adjusted, expected 30 cents
- Earnings: $4.65 billion versus a forecast of $4.61 billion
Block posted gross profit of $1.66 billion, up 40% from a year ago. This beat Wall Street’s estimate of his $1.53 billion.
Analysts tend to look at gross profit to more accurately measure a company’s core transactional business.
The company posted an (unadjusted) net loss of $114 million, or 19 cents per share, for the quarter.
Twitter CEO Jack Dorsey addresses students at the Town Hall of the Indian Institute of Technology (IIT), New Delhi, India, November 12, 2018.
Anushree Fadnavis | Reuters
Block, formerly known as Square, said in a call with CNBC that the company had 51 million monthly active transactions on its Cash App in December, averaging two out of three transactions per week.
According to Block, gross profit for its Cash App business was $848 million, up 64% year-over-year. As of December 2022, Cash App had 51 million monthly transactions, up 16% year over year.
The company, which is run by CEO Jack Dorsey, said the Cash Up Card will generate more than $750 million in gross profit in 2022, up 56% from the same period last year.
The company’s point-of-sale business, Square, grew gross profit by 22% on an annual basis to $801 million.
The stock is up more than 15% in 2023 before Thursday’s after-hours move.
Executives will discuss the results in a conference call beginning at 5:00 PM ET.
