Online payment giant Block reported on Thursday strong growth in revenue and gross profit in the fourth quarter, as the main stalwarts of his business, digital wallet CashApp and business payment platform Square, showed great profits.
The company posted $1.66 billion in gross profit in the fourth quarter of 2022, a nearly 40% increase from nearly $1.2 billion in the fourth quarter of 2021. Revenue was $4.65 billion, a jump from $4.1 billion in the same quarter of 2021. CashApp and Square drove most of the gains, as CashApp posted a staggering 64% jump in year-over-year gross revenue, and Square has 22%.
In after-hours trading, share prices rose approximately 8% percent from $74 to $80.
The company reported quarterly earnings per share of 22 cents, compared with analysts’ estimates of 30 cents per share. surveyed by FactSet. The block, however, beat forecasts on revenue and gross profit.
“Looking ahead to 2023 and beyond, we are focused on balancing growth and efficiency and prioritizing speed, agility, and accountability,” Block CEO Jack Dorsey and CFO Amrita Ahuja wrote in a letter. to the shareholders.
The outlook, however, for the company’s dive into Bitcoin is warmer. Block invested $220 million in Bitcoin in 2020 and 2021, but the company’s Bitcoin holdings were only worth $133 million at the end of 2022.
Its Bitcoin trading business on CashApp also declined. The total revenue in the fourth quarter from the sale of Bitcoin on CashApp was $1.83 billion, up from $1.96 billion in the same quarter of 2021, and the full-year gross revenue from the cryptocurrency decreased from approximately $46 million to $35 million, just a fraction of the block’s total revenue.
In 2018, Dorsey, a prominent Bitcoin evangelist, Office has partnered that CashApp users can buy and sell Bitcoin through the digital wallet. And more than two years ago, the company, formerly known as Square, made a significant investment in cryptocurrency. To introduce his company’s devotion to crypto, Dorsey then announced that the payment titan will change its name to Block. Since then, he has continued to double Bitcoin.
Dorsey announced the performance TBDa Block subsidiary that was soon released a white paper details plans for building a decentralized Bitcoin trading exchange. After the fall of FTX, Block also announced that it develop a new wallet to allow its customers to hold Bitcoin themselves, rather than having tokens managed by third parties. And the company has recently invested in a Bitcoin mining company which says it is trying to bring cheap energy to places like Kenya and Malawi.
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