Shares of Block, Jack Dorsey’s fintech company, saw a 12% surge to $49.19 following the release of its bullish Q3 earnings report. The report revealed that Block’s total net revenue increased by 24% YoY to $5.62 billion. Excluding Bitcoin revenue, the figure stood at $3.19 billion, up 16% since Q3 2022. Cash App, Block’s payment subsidiary, saw a 37% increase in Bitcoin revenue compared to the same period last year.
The company’s earnings per share reached $0.55, beating expectations of $0.47. Gross profit also grew 21% YoY, from $1.57 billion to $1.9 billion. Transaction-based profit amounted to roughly $674 million, while subscription and services-based profit reached $1.23 billion.
Additionally, Block benefited from the rising value of Bitcoin on its balance sheet this year. As of September 30, the fair value of Bitcoin was $216 million, exceeding its carrying value of $102 million by $114 million.
It is worth noting that current accounting standards require impairment charges on corporate balance sheets when the value of Bitcoin declines. However, a new “fair value” accounting standard for digital assets is expected to be implemented in 2024.
In related news, Coinbase, the leading crypto exchange in the US, also exceeded revenue expectations in Q3 with earnings of $674 million, primarily driven by subscription and services revenue.
Hot Take: Block’s Bullish Q3 Earnings Report Boosts Share Price
Block (SQ), Jack Dorsey’s fintech giant, experienced a significant surge in share price following the release of its Q3 earnings report. The report showcased impressive growth in total net revenue and gross profit for the company.
Moreover, Cash App’s increased Bitcoin revenue contributed to the positive performance. Block’s success reflects the growing interest in cryptocurrencies and their potential to generate substantial income.
With the rise in Bitcoin’s value on its balance sheet, Block has also gained a balance sheet boost, further strengthening its position in the market.
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