Block Inc.’s shares fell by almost 18% to $68.35, the largest decline in five years, after the company missed analysts’ revenue forecasts for its fourth quarter. The digital payments company reported revenue of $6.03 billion, less than the estimated $6.28 billion.
Despite seeing a surge in net income to $1.95 billion, adjusted earnings fell short of expectations at 71 cents per share. The company’s “bank our base” strategy aimed to boost growth in its Cash App service was also seen as disappointing, with flat growth in monthly active users and unchanged gross profit guidance for 2025.
However, Block did see some positive signs, including an increase in direct deposit customers using the app, up 25% year over year. The company’s cash app card user base grew to 25 million, and it plans to expand its buy now, pay later service, Afterpay, through the Cash App card.
The decline came after Block settled with regulators in January, agreeing to pay $75 million in redress to consumers and $55 million in civil money penalties. The company competes with PayPal and Stripe in the digital payments market.
Source: https://finance.yahoo.com/news/block-shares-sink-most-18-180902550.html