The Block Inc (ASX: SQ2) share price is avoiding the market weakness and pushing higher on Friday.
In morning trade, the payments companyâs shares are up 1.5% to $91.40.
Why is the Block share price rising?
Investors have been bidding the Block share price higher today after the payments company released its first-quarter update. Hereâs how it performed:
- Gross payment volume of US$51.1 billion
- Gross profit up 32% to US$1.71 billion
- Adjusted operating income of US$51 million (up from US$42 million loss)
- Adjusted EBITDA up 89% to US$368 million
- Net loss improved to US$17 million (from US$201 million)
- April gross profit up 24%
What happened during the quarter?
For the three months ended 31 March, Block reported a 32% increase in gross profit to US$1.71 billion. This was driven by 49% increase in Cash App gross profit to US$931 million and a 16% lift in Square gross profit to US$770 million.
The former was underpinned by a 15% in Cash App monthly transacting actives to 53 million, with inflows per transacting active up 8%. Cash App also generated US$50 million in Bitcoin gross profit for the quarter.
As you might have guessed from the Block share price reaction, this result was ahead of the marketâs expectations.
Outlook
Also giving the Block share price a boost has been news that management expects to deliver adjusted EBITDA of US$1.36 billion in FY 2023. This is up from its previous guidance of US$1.30 billion and is now ahead of the consensus estimate of US$1.32 billion.
Another positive is that Block is now expecting an adjusted operating loss of US$115 million for the year, which is down from its prior guidance for a loss of US$150 million.
The post Block share price charges higher on strong Q1 result and guidance appeared first on The Motley Fool Australia.
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More reading
- Down 37% in a year, fundie says Block shares offer ‘very attractive rate of return’
- Here are the top 10 ASX 200 shares today
- Here are the top 10 ASX 200 shares today
- Why Block, Nanosonics, Pilbara Minerals, and Weebit Nano shares are racing higher
- Why is the Block share price tumbling 6% today?
Motley Fool contributor James Mickleboro has no position in any of the stocks mentioned. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. has positions in and has recommended Block. The Motley Fool Australia has positions in and has recommended Block. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.
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