{"id":7133,"date":"2024-02-24T02:08:10","date_gmt":"2024-02-24T02:08:10","guid":{"rendered":"https:\/\/demo5.dedicatedhost247.com\/zexo\/block-shares-surge-16-after-company-announces-surprise-profit\/"},"modified":"2024-02-24T02:08:10","modified_gmt":"2024-02-24T02:08:10","slug":"block-shares-surge-16-after-company-announces-surprise-profit","status":"publish","type":"post","link":"https:\/\/demo5.dedicatedhost247.com\/zexo\/block-shares-surge-16-after-company-announces-surprise-profit\/","title":{"rendered":"Block shares surge 16% after company announces surprise profit"},"content":{"rendered":"<p> <br \/>\n<\/p>\n<div id=\"RegularArticle-ArticleBody-5\" data-module=\"ArticleBody\" data-test=\"articleBody-2\" data-analytics=\"RegularArticle-articleBody-5-2\"><span class=\"HighlightShare-hidden\" style=\"top:0;left:0\"\/><\/p>\n<div class=\"InlineImage-imageEmbed\" id=\"ArticleBody-InlineImage-107302584\" data-test=\"InlineImage\">\n<div class=\"InlineImage-wrapper\">\n<div>\n<p>Jack Dorsey, co-founder and chief executive officer of Twitter Inc. and Square Inc., listens during the Bitcoin 2021 conference in Miami, Florida, on Friday, June 4, 2021.<\/p>\n<p>Eva Marie Uzcategui | Bloomberg | Getty Images<\/p>\n<\/div>\n<\/div>\n<\/div>\n<div class=\"group\">\n<p><span class=\"QuoteInBody-quoteNameContainer\" data-test=\"QuoteInBody\" id=\"RegularArticle-QuoteInBody-1\"><a href=\"https:\/\/www.cnbc.com\/quotes\/SQ\/\">Block<\/a><span class=\"QuoteInBody-inlineButton\"><span class=\"AddToWatchlistButton-watchlistContainer\" id=\"-WatchlistDropdown\" data-analytics-id=\"-WatchlistDropdown\"><button class=\"AddToWatchlistButton-watchlistButton\" aria-label=\"Add To Watchlist\" data-testid=\"dropdown-btn\"><span class=\"AddToWatchlistButton-addWatchListFromTag\"\/><\/button><\/span><\/span><\/span> stock closed up 16% Friday, a day after the payments company <a href=\"https:\/\/s29.q4cdn.com\/628966176\/files\/doc_financials\/2023\/q4\/Block_4Q23_Shareholder-Letter_Block.pdf\" target=\"_blank\" rel=\"noopener\">reported<\/a> fourth-quarter earnings that beat analysts&#8217; estimates on gross profit and showed strong growth in its Square and Cash App revenue.<\/p>\n<p>Here&#8217;s how the company did, compared to analysts&#8217; consensus from LSEG, formerly known as Refinitiv:<\/p>\n<ul>\n<li><strong>Earnings per share: <\/strong>45 cents adjusted,<strong> <\/strong>not comparable to estimates<\/li>\n<li><strong>Revenue: <\/strong>$5.77 billion vs. $5.70 billion expected<\/li>\n<\/ul>\n<p>Block posted $2.03 billion in gross profit, up 22% from a year ago. Analysts tend to focus on gross profit as a more accurate measurement of the company&#8217;s core transactional businesses.<\/p>\n<p>The company raised its adjusted EBITDA forecast to at least $2.63 billion from $2.40 billion.<\/p>\n<p>Block, formerly known as Square, ended the year with 56 million monthly transacting actives for Cash App in December, with most of those customers using it for either peer-to-peer payments or the Cash App Card.<\/p>\n<p>Its Cash App business reported $1.18 billion in gross profit, a 25% year-over-year rise.<\/p>\n<p>The company, which is run by Jack Dorsey, said its Cash App Card has 23 million monthly actives in December, up 20%. That is more than two times the growth rate of total monthly actives.<\/p>\n<p>&#8220;We believe this strategy will enable us to build the largest network in the long run, with a highly engaged customer base using Cash App as their primary banking solution,&#8221; Dorsey said in a note to shareholders.<\/p>\n<p>The payments firm has focused on slimming down operations in recent months. In January, the Block CEO <a href=\"https:\/\/www.businessinsider.com\/block-layoffs-jack-dorsey-tech-industry-cuts-2024-1\" target=\"_blank\" rel=\"noopener\">reportedly<\/a> said in a note to staffers that the company had laid off a &#8220;large number&#8221; of workers. This followed another round of layoffs in December.<\/p>\n<p>Dorsey said in his note to shareholders that the company was now below a previously set cap of 12,000 employees.<\/p>\n<p>&#8220;We&#8217;re going to operate under this cap until we feel it&#8217;s holding us back, which is likely years out,&#8221; Dorsey wrote. The company recorded a $70 million charge for severance costs.<\/p>\n<p>The company also took an $132 million impairment on its investment in music streaming service Tidal. Block and Dorsey have had a mixed dealmaking record. The company sold <a href=\"https:\/\/www.cnbc.com\/2020\/06\/24\/square-gets-back-into-food-delivery-less-than-a-year-after-selling-caviar.html\">delivery<\/a> service Caviar to DoorDash in 2019 in a <a href=\"https:\/\/www.cnbc.com\/2019\/08\/01\/square-sells-food-delivery-service-caviar-to-doordash-for-410-million.html\">$410 million cash-and-stock deal<\/a>. It also acquired <a href=\"https:\/\/www.cnbc.com\/2021\/08\/02\/square-to-buy-australia-fintech-afterpay-amid-buy-now-pay-later-trend.html\">Afterpay in 2021<\/a> for $29 billion, its largest acquisition ever.<\/p>\n<p>Afterpay has struggled since the deal announcement, posting <a href=\"https:\/\/www.smh.com.au\/business\/banking-and-finance\/afterpay-posts-huge-loss-as-bad-debts-mount-20220412-p5acvr.html\" target=\"_blank\" rel=\"noopener\">successive quarters<\/a> of <a href=\"https:\/\/www.smh.com.au\/business\/banking-and-finance\/afterpay-posts-huge-loss-as-bad-debts-mount-20220412-p5acvr.html\" target=\"_blank\" rel=\"noopener\">losses<\/a> throughout 2022. Dorsey said in his note to shareholders that integrating Afterpay more tightly into Cash App and using it to power Cash App&#8217;s buy-now, pay-later technology were two focuses for 2024.<\/p>\n<p>Block&#8217;s strong quarterly results and full-year outlook prompted Wall Street analysts to upgrade their rating of the stock on Friday.<\/p>\n<p>Wells Fargo upgraded Block to overweight and raised its price target from $65 to $95, while Seaport Research Partners upgraded the stock to a buy and also hiked its price target to $95.<\/p>\n<p>&#8220;SQ&#8217;s progress over the past several months in terms of streamlining itself organizationally, sharpening its focus within its two key businesses Square and Cash App, and becoming hyper-focused on driving profitable growth has been impressive,&#8221; the Seaport Research Partners analysts wrote. &#8220;We think there&#8217;s more to go.&#8221;<\/p>\n<p><em>\u2014\u00a0CNBC&#8217;s Michael Bloom, Rohan Goswami, Alex Koller and Kate Rooney contributed to this report.<\/em><\/p>\n<p><strong>WATCH: Block shares pop on earnings beat<\/strong><\/p>\n<\/div>\n<div role=\"region\" aria-labelledby=\"Placeholder-ArticleBody-Video-107377164\">\n<div role=\"button\" tabindex=\"0\" id=\"Placeholder-ArticleBody-Video-107377164\" class=\"PlaceHolder-wrapper\" data-vilynx-id=\"7000332386\" data-test=\"VideoPlaceHolder\">\n<div class=\"InlineVideo-videoEmbed\" id=\"InlineVideo-0\" data-test=\"InlineVideo\">\n<div class=\"InlineVideo-wrapper\">\n<div class=\"InlineVideo-inlineThumbnailContainer\"><span class=\"InlineVideo-videoButton\"\/><span\/><\/div>\n<\/div>\n<\/div>\n<\/div>\n<\/div>\n<\/div>\n\n","protected":false},"excerpt":{"rendered":"<p>Jack Dorsey, co-founder and chief executive officer of Twitter Inc. and Square Inc., listens during the Bitcoin 2021 conference in Miami, Florida, on Friday, June 4, 2021. Eva Marie Uzcategui | Bloomberg | Getty Images Block stock closed up 16% Friday, a day after the payments company reported fourth-quarter earnings that beat analysts&#8217; estimates on [&hellip;]<\/p>\n","protected":false},"author":1,"featured_media":7134,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"spay_email":""},"categories":[49],"tags":[2374,5039,10792,1036,199,1188,299,9507,10328,730,303,186,10791,619,571,668,498,304],"jetpack_featured_media_url":"https:\/\/image.cnbcfm.com\/api\/v1\/image\/106915554-1626988283647-jack2.jpg?v=1667908170&w=1920&h=1080","_links":{"self":[{"href":"https:\/\/demo5.dedicatedhost247.com\/zexo\/wp-json\/wp\/v2\/posts\/7133"}],"collection":[{"href":"https:\/\/demo5.dedicatedhost247.com\/zexo\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/demo5.dedicatedhost247.com\/zexo\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/demo5.dedicatedhost247.com\/zexo\/wp-json\/wp\/v2\/users\/1"}],"replies":[{"embeddable":true,"href":"https:\/\/demo5.dedicatedhost247.com\/zexo\/wp-json\/wp\/v2\/comments?post=7133"}],"version-history":[{"count":0,"href":"https:\/\/demo5.dedicatedhost247.com\/zexo\/wp-json\/wp\/v2\/posts\/7133\/revisions"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/demo5.dedicatedhost247.com\/zexo\/wp-json\/wp\/v2\/media\/7134"}],"wp:attachment":[{"href":"https:\/\/demo5.dedicatedhost247.com\/zexo\/wp-json\/wp\/v2\/media?parent=7133"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/demo5.dedicatedhost247.com\/zexo\/wp-json\/wp\/v2\/categories?post=7133"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/demo5.dedicatedhost247.com\/zexo\/wp-json\/wp\/v2\/tags?post=7133"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}