Fintech company Block, led by former Twitter CEO Jack Dorsey, made $66 million in gross profit last quarter from Bitcoin sales through Cash App, a 90% increase from a year ago. became.
Company’s Q4 2023 earnings report was released on Thursday, stock an increase in the price of NASDAQ:SQIn after-hours trading, the stock rose 12.35% to $76.10 from $67.96 at market close.
“The total value of Bitcoin sold to customers (which we recognize as Bitcoin revenue) was $2.52 billion, an increase of 37% year-over-year,” the report explains. “The year-over-year increase in Bitcoin revenue and gross profit was due to the increase in the average market price of Bitcoin and the benefit of the increase in the price of Bitcoin inventory during the quarter.”
In late 2020 and early 2021, Block invested $50 million and $170 million in Bitcoin, respectively. By the end of 2023, the company had 8,038 Bitcoins (worth approximately $340 million) on its balance sheet. Currently valued at well over $400 million, Block said it will recognize a $207 million gain on this investment as of December 2023.
Many of these Bitcoin sales were made via smartphones. Block said the company’s mobile cash app generated $205 million in Bitcoin gross profit and $9.5 billion in Bitcoin revenue in 2023, up 31% and 34% from the previous year, respectively.
“The biggest driver will be connected banking features that work easily and that people can trust,” Dorsey said. “We want people to see Cash App as something they can trust to have their money, and their entire paycheck, deposited directly into them.”
Block revenue for the year ended December 31, 2023 increased to $9,498,302, an increase of 33.54% from $7,112,856 in the prior year. However, when comparing 2022 and 2021, his revenue decreased by 28.96% from $10,012,647 a year ago to $7,112,856.
After Block’s third-quarter earnings report in November, Block shares rose 20% to $52 per share on better-than-expected earnings news. At the time, Block reported that the company’s total net revenue reached $5.62 billion in the third quarter of 2023, of which $2.42 billion came from Cash App.
“The improvement from the third quarter was driven by a number of factors, including higher Bitcoin gross margins due to price changes implemented during the quarter,” Block COO and CFO Amrita Ahuja said in an earnings call. ” he said.
While most of the call focused on Cash App, Dorsey emphasized the growing role of artificial intelligence in the future of financial services.
“[AI] This is going to be very impactful for us as we look at everything we’re doing, all the tools we’re building, and how much productivity we’re seeing.” said Dorsey. “[AI] This allows us to learn much faster, ship faster, fix mistakes faster, and market where we think creativity and integrating all these very complex systems is our strength. You can actually get ahead of the curve. ”
Edited by Ryan Ozawa.
