blockowner of cash app and squareis also a large Bitcoin owner.
This is as the company's latest Q1 2024 Financial results The company revealed that its $200 million investment in Bitcoin grew by about 160%, reaching $573 million at the end of the quarter.
“We believe the world needs an open money protocol that is not owned or controlled by a single organization. We believe that we are the best and only candidate to become the Block's CEO,” said Jack Dorsey, Head of Block, Head of Square, Block Chairman and Co-Founder. shareholder letter.
“1.6 million Cash App Card users use our Bitcoin Roundup feature to automatically convert their daily transactions into Bitcoin,” he added.
In April, Block introduced the Bitcoin Dollar Cost Average (DCA) purchase program, which invests 10% of gross profits from Bitcoin products into Bitcoin purchases. This program will run until 2024.
But the story of Thursday's (May 2) quarterly earnings call wasn't about Bitcoin growth, but about the company's core products, Cash App and Square. Square alone processed $50.5 billion in total payments in the quarter, an increase of 9% year over year. Executives also emphasized an increased focus on prioritizing and advancing Square's banking solutions.
Block CFO Amrita Ahuja said: “Local banking is our priority.”
Block's gross profit for the first quarter of 2024 was $2.09 billion, an increase of 22% year over year. Cash App generated gross profit of $1.26 billion, up 25% year over year, and Square generated gross profit of $820 million, up 19% year over year.
Block beat Wall Street expectations, and shares rose nearly 10% in after-hours trading. The company's stock price has fallen about 9% since the beginning of the year.
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Block wants to be a bank, and it's using Square to get there
Block executives told investors Thursday they were raising their full-year profit outlook to reflect better first-quarter results and heightened expectations for the rest of the year. For the full year, Block expects gross profit of at least $8.78 billion (up 17% year-over-year), adjusted operating income of at least $1.3 billion and adjusted EBITDA of at least $2.76 billion.
Executives highlighted four priorities that underpin the Square platform's growth roadmap: a rock-solid and flexible platform, delivering a “local” experience to sellers of all sizes, growth powered by artificial intelligence (AI), and Emphasis on dependence.
“Banking solutions are the biggest differentiator for Square,” Dorsey said. “We use AI to automate the previously manual task of uploading details about various service offerings to Square Appointments, saving sellers time.”
Block's gross profit, primarily from banking products including Square Loans, Instant Transfer and Square Debit Card, increased 36% year over year. Executives told investors on Thursday that the bank's gross profit strength was driven by continued strong loan demand and healthy repayment trends.
Square Loans facilitated approximately 129,000 loans totaling $1.32 billion in loans, an increase of 17% year-over-year, according to Block's financials.
Please also read: Report: Block aims to cut workforce to 12,000 this year
But Block's story wasn't just about Square. The company's Cash App platform also saw strong quarterly growth.
Cash App Card monthly actives reached 24 million, an increase of 16% year over year. Meanwhile, Cash App Pay continued to grow throughout the quarter, with sales volume increasing more than 40% sequentially.
According to company documents, Cash App's strong growth during the quarter was primarily driven by Cash App Card, BNPL, Bitcoin, and Cash App Borrow, all of which are within Block's “Bank the Base” strategy. This is an area that they are focusing on.
“Cash App, along with our banking partners, is focused on the three-part strategy we introduced last quarter: our foundational banking, our move upmarket with family services, and our next-generation social Our primary focus in the short term is to build our base into a bank by accelerating the adoption of payroll deposits and increasing inflows per active,” Dorsey said in a letter to shareholders. It is written in
Still, Dorsey repeatedly emphasized his views on Bitcoin during earnings calls and in letters to shareholders.
“The Internet will have a native currency. It's only a matter of time. Artificial intelligence systems and agents will need to make transactions, and the most efficient way to do so will be a common protocol for transferring funds. ” he said.
