- Block, formerly known as Square and led by Jack Dorsey, has exceeded analysts’ expectations with its Q1 earnings report.
- The company has seen a rise in its shares after the report, with a notable move to increase Bitcoin assets and encourage others to do the same.
- Block’s original Bitcoin investment of $220 million has already increased by approximately 160% to reach $573 million.
Block, previously known as Square, has reported impressive Q1 earnings, exceeding analysts’ expectations and leading to a rise in shares. The company’s strategic Bitcoin investment has also seen significant growth.
Block’s Bitcoin Investment Strategy Boosts Shares
Block reported adjusted earnings of 85 cents per share, surpassing the consensus estimate by 13 cents and generating revenue of $5.97 billion, exceeding Wall Street’s projection of $5.82 billion. Gross profit for the quarter increased by 22% compared to the previous year, reaching $2.09 billion.
Increasing Bitcoin Assets
Under the leadership of Jack Dorsey, the company announced plans to increase its Bitcoin assets and encourage others to do the same by making its treasury plan open-source. Block will invest 10% of the gross profit from its Bitcoin products in Bitcoin purchases every month. The company’s original Bitcoin investment of $220 million has already grown by approximately 160% to reach $573 million.
Dorsey’s Belief in Bitcoin
Dorsey stated, “We believe the world needs an open monetary protocol that no single organization owns or controls. We believe Bitcoin is the best and only candidate to be this protocol and ultimately become the native currency of the internet.”
Performance of Cash App Unit
The company’s Cash App unit recorded a 25% increase in gross profit in Q1 compared to the same period last year. This growth was primarily driven by strong performance in Cash App Card, BNPL platform, Bitcoin products, and Cash App Borrow, as well as increased entries per active and earning rate.
Bitcoin Revenue
The total amount of Bitcoin sold to customers and recorded as Bitcoin revenue was $2.73 billion, resulting in a gross profit of $80 million in the first quarter.
Conclusion
Block’s strategic move to increase its Bitcoin assets has proven successful, with significant growth in its original investment. The company’s belief in Bitcoin as the future native currency of the internet, along with the strong performance of its Cash App unit, has contributed to its impressive Q1 earnings.
