tl;dr
Block (NYSE:SQ) stock gapped up 6.2% in Thursday after-hours trading after the payment and fintech app company raised its full-year 2024 guidance and turned in Q1 earnings and revenue that topped Wall Street expectations. The company now expects 2024 adjusted EBITDA of $2.76B, compared with the $2.6...
Block (NYSE:SQ) stock gapped up 6.2% in Thursday after-hours trading after the payment and fintech app company raised its full-year 2024 guidance and turned in Q1 earnings and revenue that topped Wall Street expectations. The company now expects 2024 adjusted EBITDA of $2.76B, compared with the $2.68B Visible Alpha consensus and the previous view of $2.63B. Adjusted EBITDA margin is now expected to be 31% vs. 30% in the prior guidance. Gross profit for the year is anticipated to be $8.78B, implying 17% Y/Y growth, up from the previous target of $8.65B, which implied 15% annual growth. It sees adjusted operating income of $1.30B, implying 15% growth from 2023's level, compared with $1.15B in the previous projection. Adjusted operating income is expected to be 15% vs. the prior outlook of 13%. Rule of 40, which Block (SQ) calculates as gross profit growth plus adjusted operating income margin, is now expected to come in at 32% in 2024 compared with the prior target of 29%. Block still aims to achieve Rule of 40 in 2026. For Q2, the Jack Dorsey-founded company sees gross profit of $2.165B-$2.185B, adjusted EBITDA of $670M-$690M (vs. $647.4M Visible Alpha consensus), and adjusted operating income of $305M-$325M. It expects gross profit margin of 16%-17%, adjusted EBITDA margin of 31%-32%, and adjusted operating income margin of 14%-15%. The Bitcoin Vision Block (SQ) announced that, on a monthly basis, it will invest 10% of its gross profit from Bitcoin (BTC-USD) products into purchases of Bitcoin itself. The company called its new process the "balance sheet dollar cost average program," which took effect last month. Its previous bitcoin-buying strategy included buying Bitcoin (BTC-USD) in lump sums. "By allocating a portion of our monthly bitcoin gross profits to Bitcoin investment on a predetermined and recurring cadence, we sidestep the challenges of market timing," Block said in a memo. "We believe this approach enables us to optimize our long-term investment position while minimizing the price risks associated with attempting to aggregate less frequent, larger purchases." Q1 Results Adjusted EPS of $0.85, beating the $0.73 average analyst estimate, nearly doubled from $0.46 in the prior quarter and $0.43 a year before. Gross payment volume of $54.4B, trailing the $55.6B Visible Alpha consensus, retreated from $57.5B in Q4 2023 and advanced from $51.1B in the year-ago quarter. Total net revenue of $5.96B, vs. $5.82B consensus, increased from $5.77B in Q4 2023 and $4.99B in Q1 2023. Gross profit rose to $2.09B from $2.03B in Q4 2023 and $1.71B in Q1 2023. Adjusted EBITDA was $705.1M (vs. $588.6M Visible Alpha consensus), up from $562M in Q4 2023 and $368.4M in Q1 2023.
More about Block Inc
Stock Analysis Summary Stock Analysis Summary
Company: Block Inc, Square, Inc.
Industry: Technology, Services-Prepackaged Software
Market Cap: 45,138,674,000
PE Ratio: 3650
Dividend Yield: None
EPS: 0.02
Price/Earnings: 35.99
Profit Margin: 0.0005
Revenue: 21,915,623,000
Market Price: $90.58
RSI: -0.998
Bollinger Bands: 0.241
Disclaimer: The opinions expressed by the writers at Grow My Bag are their own and do not reflect the official stance of Grow My Bag. The content provided on our site is not intended as investment advice, and Grow My Bag is not an investment advisor. We do not endorse buying or selling any cryptocurrencies or digital assets mentioned in our articles. High-risk investments in Bitcoin, cryptocurrencies, and digital assets require thorough due diligence, and all transfers and trades made are at your own risk. Grow My Bag is not responsible for any potential losses and participates in affiliate marketing.