Block, the fintech company led by Jack Dorsey, saw a significant spike in its share price in after-hours trading on Thursday, following the release of its Q3 earnings report, which beat analyst expectations. The company’s stock was trading around $50 after the close.
The robust performance was largely driven by a 37.5% year-over-year increase in bitcoin revenue, which reached $2.42 billion, up from $1.76 billion a year earlier. This surge in bitcoin revenue contributed to Block’s overall net revenue growth of 24% YoY. Bitcoin gross profit also increased, reaching $44 million compared to $36 million in the previous year.
In addition to bitcoin-related revenue, Block’s flagship product, Cash App, also saw strong growth, with revenue increasing 34% YoY to $3.58 billion. The company’s other payment platform, Square, reported revenues of $1.98 billion.
Block revised its full-year adjusted EBITDA from $1.5 billion to between $1.66 billion and $1.68 billion, and expects full-year operating income to increase from $25 million to between $205 million and $225 million. The company also provided 2024 adjusted operating income guidance of $875 million and projects 2023 gross profit of between $7.44 billion and $7.46 billion.
In the wake of a short-seller attack, Dorsey’s letter thanked shareholders for their trust and promised accountability. He also outlined the company’s go-to-market strategy and refocus on AI technology as part of Block’s future plans.
Despite the earnings beat, accounting rules created a $114 million discrepancy between the market value and book value of Block’s bitcoin holdings, which were valued at $216 million. However, no impairment charge was recorded in Q3 2023.
