TheBlock
Block shares jumped 6.2% in after-hours trading Tuesday after the company reported third-quarter net income of $566 million, up from $462 million a year earlier, and raised its full-year gross profit forecast to $12.63 billion, implying 22% year-on-year growth. Revenue rose to $6.72 billion from $6.12 billion, while gross profit increased 22% to $3.24 billion.
Why it matters
Cash App was a key growth contributor, generating $2.07 billion in gross profit, up 27% year-on-year. Block also said it expects gross profit to grow at least 15% in 2027, while continuing to invest in long-term growth and expand margins.
The results show contrasting trends across Block’s business. Gross profit from its bitcoin ecosystem fell 50% year-on-year to $52 million. Block attributed the decline to a strategic reduction in fees on certain bitcoin transactions through Cash App. The segment includes customer bitcoin purchases in Cash App, Proto and bitcoin withdrawal fees.
Market impact
Block closed down 1.4% at $76 on Tuesday before its after-hours jump. The forecast increase and stronger Cash App performance were reported alongside the bitcoin segment’s steep decline, making the sources of growth an important part of the earnings picture.
Cash App generated $4.07 billion in Q3 revenue, including $1.77 billion from the bitcoin ecosystem segment. The company’s revised outlook and its expectation for at least 15% gross profit growth in 2027 are the next benchmarks for investors tracking whether its broader growth can offset weaker bitcoin-related gross profit.
Frequently asked questions
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Why did Block raise its full-year gross profit forecast?
Block said it was raising guidance to reflect business momentum. Its Q3 gross profit rose 22% year-on-year to $3.24 billion.
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How did Cash App perform in the third quarter?
Cash App generated $2.07 billion in gross profit, up 27% year-on-year, and $4.07 billion in revenue.
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Why did Block’s bitcoin ecosystem gross profit fall?
Block attributed the 50% year-on-year decline, to $52 million, to a strategic reduction in fees on certain bitcoin transactions through Cash App.
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What does Block include in its bitcoin ecosystem segment?
The segment primarily includes customer bitcoin purchases within Cash App, Proto and bitcoin withdrawal fees.
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What growth does Block expect in 2027?
Block said it expects gross profit to grow at least 15% in 2027 while continuing to invest in long-term growth and expand margins.
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