Block Beats Wall Street Forecasts in Q1 2024, Shares Surge Amid Bitcoin Focus
Summary:
Block, a fintech firm, has reported surpassing Wall Street's Q1 2024 revenue and earnings predictions, contributing to a boost in its share price. Earnings per share rose to $0.85, and gross profits for the quarter reached $2.09 billion, a 22% annual increase. The company's mobile payments platform, Cash App, significantly participated in profit generation, with $1.26 billion in gross profits. Despite allegations of processing transactions for terrorist organizations, company co-founder Jack Dorsey defended their investment in Bitcoin, arguing that it allows for a faster global service.
In its Q1 2024 results, Block, a fintech company, exceeded Wall Street analysts' revenue and earnings forecasts, resulting in a surge in its stock price in after-hours trading. According to reports released on May 2, Block realized revenues amounting to $5.96 billion, surpassing projections by Zacks analytic company by 3.54%. Its earnings per share also increased to $0.85, outpacing Zacks' estimate of $0.62 per share. Block's Q1 gross profits reached $2.09 billion, a 22% increase compared to the same period in the previous year. Block registered a slight quarterly growth in gross profit during this quarter according to the company’s released data. The company's mobile payments platform, Cash App, significantly contributed to its profits, reporting gross profits of $1.26 billion in Q1. On May 2, Block's shares jumped 6.8% after-hours to over $75, after closing at $70.30, showing an increase of 5.1%, as detailed in Google Finance. Although its share price has decreased by 2.6% since the beginning of the year, dipping from around $73 to $66 earlier this week, following a report by NBC News that US prosecutors were investigating the company for alleged processing of transactions for terrorist groups and users in sanctioned countries through its Square and Cash App businesses. In the company's shareholder letter, Block co-founder Jack Dorsey asked: "Why are we so interested in Bitcoin?” Dorsey revealed that less than 3% of its resources are dedicated to Bitcoin-related projects, which are "fully funded" by its Bitcoin exchange profits. He argued the necessity of such projects as "the world requires an unregulated money protocol that doesn't belong to any one entity.” Dorsey further opined that Bitcoin could be this protocol, stating that an "open money protocol allows us to quickly serve more people worldwide." More developments about this story will be provided as they become available.
Published At
5/3/2024 12:33:46 AM
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