Block, the digital payments firm run by Jack Dorsey, reported strong quarterly sales that were in line with expectations but failed to impress investors.
The shares fell. Revenue at the company formerly known as Square was $4.08 billion, slightly topping the $4.01 billion average estimated by analysts. Gross profit for the quarter — a metric that includes fees from Square’s Cash App and Seller businesses — was $1.18 billion, up 47% from a year earlier.
The results were buoyed by a slight resurgence in consumer demand for Bitcoin through its Cash App and increasing in-person retail shopping over the holidays.
Revenue from Bitcoin purchases was $1.96 billion, almost half of Block’s total quarterly sales, though executives say those transactions contribute little to the bottom line. Gross profit generated by Bitcoin sales was just $46 million.
Net income, excluding some items, was $140.4 million. Analysts projected $115.1 million. Block shares gained in early after-hours trading, before slumping about 4%.
Thursday was the company’s first earnings report since changing its name in December, an effort to differentiate its corporate entity from its Square seller product — and a signal of its increased investment in blockchain technologies and Bitcoin. Co-founder and Chief Executive Dorsey is a Bitcoin enthusiast, and San Francisco-based Block has a number of Bitcoin-related initiatives in the works, including a financial services division focused on the cryptocurrency.
In January, Dorsey
It’s also the first financial report since Dorsey resigned as CEO of his other company, Twitter, in November. Dorsey is no longer dividing his time between two companies, for the first time since 2015.
Block also said it completed its
