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Block's earnings miss on drop in bitcoin revenue ​

Square's parent company missed analysts' expectations on earnings and revenue.

Stacked blocks of Block's product logos

Block reported first-quarter earnings Thursday.

Image: Block

Block missed earnings and revenue expectations driven in part by a drop in bitcoin revenue amid a general downdraft in the cryptocurrency market.

Shares were up 5% after hours, with the regular session down 10.5% during a broader market meltdown on Wall Street.

Earnings came in at 18 cents per share compared to analysts' expectations of 20 cents per share. Revenue was $3.96 billion, down 22% from a year ago.

Block's bitcoin revenue was $1.73 billion in the first quarter of 2022, a drop of 51% from the year-ago quarter. Bitcoin gross profit was $43 million — about 3% of bitcoin revenue. Jack Dorsey has pushed the company heavily toward bitcoin as a business.

Square, the merchant seller unit, had $661 million in gross profit, which was up 41% from a year ago, while Cash App had $624 million of gross profit, up 26%.

One bright spot: subscription revenue, which decreases the company's need to rely on transaction volume alone. Square subscription revenue was $231 million in the first quarter of 2022, excluding PPP loan forgiveness revenue, up from $112 million a year ago. In addition, the company booked $54 million in Afterpay subscription revenue for Square. Cash App generated $622 million in subscription and services revenue, which was up 43% from a year ago.

Tomio Geron

Tomio Geron ( @tomiogeron) is a San Francisco-based reporter covering fintech. He was previously a reporter and editor at The Wall Street Journal, covering venture capital and startups. He was also as a staff writer at Forbes covering social media and venture capital, and edited the Midas List of top tech investors. He can be reached at tgeron@protocol.com or tgeron@protonmail.com.

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