Jack Dorsey-led Block, a Bitcoin-focused fintech company, published its third-quarter earnings report on Nov. 2, revealing a profitable quarter and surpassing analyst expectations.
The firm had $5.62 billion in revenue in the third quarter of 2023, boosted by solid revenue growth in Cash App and Square, with $44 million in profit on its Bitcoin (BTC) holdings thanks to a price surge in recent months.
In a shareholder letter, Dorsey shed light on the company’s focus and future plans, especially with Square, along with the key financial metrics from the third quarter. Dorsey said the company had authorized the repurchase of $1 billion in shares to offset a portion of dilution from share-based compensation.
In the third quarter of 2023, Block generated a gross profit of $1.90 billion, up 21% year-over-year. On the other hand, the mobile payment service Cash App generated a gross profit of $984 million, up 27% year-over-year, and Square generated a gross profit of $899 million, up 15%.
Bitcoin revenue accounted for approximately 43% of the $5.6 billion in revenue for Block. The fintech firms’ growth in the third quarter was also aided by strong consumer demand and positive spending.
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Block’s Bitcoin gross profit stood at $45 million, up by 22% year-over-year, with the firm selling $2.42 billion worth of BTC to customers via Cash App. The company’s Bitcoin gross profit stood at 2% of Bitcoin revenue. The firm claimed that the rise in BTC revenue was fueled by an increase in the average market price of Bitcoin and the quantity of Bitcoin sold to customers.
Block stated it has not seen any impairment loss on its Bitcoin holding since the previous quarter. Block’s investment in Bitcoin had a carrying value of $102 million as of Sept. 30, 2023, but its fair value, determined by observable market prices, was $216 million, or $114 million more than its carrying value.
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