Block shares fell 10% on Friday after the company reported weak third-quarter earnings that fell short of Wall Street expectations and showed slowing profit growth for its Square service.
Here is how Block performed compared with LSEG estimates:
– **Earnings per share:** 54 cents (adjusted) vs. 67 cents expected
– **Revenue:** $6.11 billion vs. $6.31 billion expected
The Jack Dorsey-founded firm’s shares have declined 24% year to date.
Square’s gross payment volume was up 12% year over year, but gross profit growth for the point-of-sale service increased only 9% compared to a year ago, slowing from last quarter’s 11%. The company attributed the slower growth to a processing partner change and lower-margin hardware sales.
“Our product and go-to-market strategies are working as we continue to gain profitable market share in our target verticals like food and beverage, with larger sellers, and outside the U.S.,” said Chief Financial Officer Amrita Ahuja on the earnings call.
Cash App’s gross profit growth performed much better, reaching $1.62 billion — an increase of 24% over the prior year — with 58 million monthly transacting active users. This strength was driven by the service’s Cash App Borrow, Cash App Card, and Buy Now Pay Later features.
Morgan Stanley analysts noted they were “encouraged by the pace of credit expansion at Cash App” and are focused on “whether credit expansion will ultimately produce better inflows” per active customer and increase direct deposit accounts.
Ahuja highlighted gross profit as a bright spot for Block, with the company reporting $2.66 billion in gross profit, up 18% year over year. This exceeded FactSet’s expectation of $2.60 billion for the quarter.
The company raised its full-year guidance for gross profit to $10.2 billion in 2025, up from the prior quarter’s projection of $10.2 billion.
Block reported net income of $461.54 million, or 74 cents per share, a significant increase from a year ago when net income was $283.75 million, or 45 cents per share.
https://www.cnbc.com/2025/11/07/block-stock-xyz-earnings.html
