Block (NYSE: XYZ) stock tumbled 9% in pre-market trading Friday after the payments company reported fourth-quarter earnings that missed Wall Street expectations despite receiving a boost from strong holiday spending and a post-election Bitcoin rally.
The Jack Dorsey-led company posted a profit of $0.71 per share, excluding one-time costs, missing the $0.87 per share that analysts had projected, according to LSEG data. Revenue also disappointed, coming in at $6.03 billion against forecasts of $6.24 billion.
Bitcoin revenue proved to be a weak spot. Block (NYSE: XYZ), which buys the cryptocurrency through private brokers and resells it for a small fee, brought in $2.43 billion from Bitcoin sales. However, analysts had expected $2.62 billion. Transaction-based revenue tied to this process totaled $1.68 billion, slightly below the projected $1.70 billion.
For 2025, the company projected at least 15% year-over-year gross profit growth, sticking to its third-quarter outlook despite new foreign exchange headwinds of 50 basis points. The company also expects adjusted operating income to climb to $2.1 billion, up from $1.61 billion in 2024, while ramping up investments in sales and marketing.
Analysts at Jefferies expressed mixed views in a client note. They noted the guidance suggests a “steep acceleration” in gross earnings beyond the current quarter and may be “met with some skepticism.” However, they added that they “take some comfort in management framing as having ‘clear visibility’ into the drivers” of Block’s performance.
