Jack Dorsey’s Block recorded a stunning $2.16 billion in bitcoin (BTC) sales in Q1. The fintech company’s main product, Cash App, generated 25% more bitcoin income yearly.
The shareholder letter states that the multi-billion dollar bitcoin revenues were attributed to an increase in the quantity of bitcoin sold to customers” and were “partially offset” by a bitcoin market price reduction compared to the same period in 2022.
Block’s 2023 Q1 findings
The financial technology company had a 26% year-over-year increase in sales during the first quarter, and it also posted earnings per share of 40 cents, which was 14 percent more than what analysts had predicted.
Block (NYSE: SQ) said in its Q1 2023 shareholder letter that its bitcoin revenue is defined as the total sales of bitcoin to clients. It increased by 18% yearly from $1.83 billion in Q4 and by 25% year over year from Q1 2022.
Q1 2023 revenues for Cash App topped $931 million, up 49% year-over-year. Cash App’s profit was minuscule compared to the company’s $1.71 billion in gross profit. During the first quarter of 2023, Block, which also owns the widely used business payment service Square, saw a slight profit decrease: 3.8% from the previous quarter.
The stock market well-received block’s earnings reports. The share price of the fintech company jumped 5% to $63.50 in after-hours trading but has since settled to a 2.5% gain as of this writing.
This rise represented the first respite after a prolonged slump in Block’s share price, which had dropped by 25% after the publication of a damning study by renowned short sellers Hindenburg Research.
When discussing how the company plans to adapt to the “significant shifts” occurring in the global financial system, Block CEO Jack Dorsey mentioned artificial intelligence and “open protocols” during the earnings conference call with investors. He pointed to de-dollarization and the persistence of bank failures in the United States as the root causes.
As the New York Times reported on March 23rd, Hindenburg accused Block of “systematically taking advantage of the demographics it claims to aid” and said that Cash App’s success was predicated only on Block’s “willingness to facilitate fraud against consumers and the government.”
In response to Hindenburg’s charges, Block stated, “Hindenburg is known for such attacks, which are solely aimed to allow short sellers to profit from a declined stock price.” We have examined the whole report in light of our findings and have concluded that it is meant to mislead and confuse investors.