• Block produced Q2 earnings that beat on top and bottom lines but were down YoY.
  • The growth rate of gross payment value is falling.
  • SQ stock lost around 7% on after-hours trading.

Block (SQ) shares are trading down 6.7% at $83.70 after Thursday evening's earnings beat. The reason for the sell-off is simply because management said gross payment volume (GPV) for the Square ecosystem would grow by 18% in July compared to 29% YoY in April. This appeared to be a harsher slowdown in growth than many expected.

Also readAmazon Stock Deep Dive: AMZN price target at $106 with near-term risks offset by long-term growth

Still, Block posted adjusted earnings per share of $0.18, which beat analyst consensus by 2 cents. Also, revenue came in at $4.41 billion, $80 million above expectations.

Block stock earnings news

Despite beating on top and bottom lines, Block's figures were lower than the period one year ago. Revenue was down nearly 6% YoY, and the $0.18 in adjusted EPS was way off the $0.66 achieved one year ago. Block brought in $1.48 billion in transaction-based revenue, a 20% YoY increase. Gross profit from these transactions was $600 million, a 10% YoY increase.

Chairman and co-founder Jack Dorsey focused his statements in the earnings call on connecting customers from one segment of the business, such as CashApp, to other segments of the larger ecosystem such as the Buy Now Pay Later option Afterpay, which was acquired last year. "In Cash App, we're just starting to bring Afterpay's discovery capabilities into our ecosystem," Dorsey said. "The greatest combined opportunity we see is in commerce. Afterpay will introduce discovery and shopping to build on the elements that Cash App has already created around commerce, like Cash App Pay and Boost."

Second-quarter gross payment volume of $52.5 billion was a leap above the $43.5 billion in Q1 2022 and from $42.8 billion in the year-ago quarter.

"Square generated $755 million of gross profit in the second quarter, an increase of 29% year-over-year and 30% on a three-year CAGR basis," said Amrita Ahuja, chief financial officer. "Excluding $75 million of gross profit from our BNPL platform, Square gross profit was $681 million, up 16% year-over-year and 25% on a three-year CAGR basis."

Block stock forecast

SQ stock's 1.9% advance in Thursday's regular session led the fintech player right up to resistance at $90. This area stems from the second half of May. Since SQ stock could not break through the high from that period of $90.99, the market will likely send it down to find support. The 9-day moving average currently sits at $77.33, and the 21-day moving average at $71.87. Additionally, the ascending bottom trend line will assuredly hold around $70.

There will not be much interesting action in SQ stock until it breaks through the $91 barrier and heads to its next source of resistance at $107.21. The Moving Average Convergence Divergence (MACD) indicator shows that there is a willingness for a sustained rally at some point.

SQ stock chart

SQ daily chart

Information on these pages contains forward-looking statements that involve risks and uncertainties. Markets and instruments profiled on this page are for informational purposes only and should not in any way come across as a recommendation to buy or sell in these assets. You should do your own thorough research before making any investment decisions. FXStreet does not in any way guarantee that this information is free from mistakes, errors, or material misstatements. It also does not guarantee that this information is of a timely nature. Investing in Open Markets involves a great deal of risk, including the loss of all or a portion of your investment, as well as emotional distress. All risks, losses and costs associated with investing, including total loss of principal, are your responsibility. The views and opinions expressed in this article are those of the authors and do not necessarily reflect the official policy or position of FXStreet nor its advertisers. The author will not be held responsible for information that is found at the end of links posted on this page.

If not otherwise explicitly mentioned in the body of the article, at the time of writing, the author has no position in any stock mentioned in this article and no business relationship with any company mentioned. The author has not received compensation for writing this article, other than from FXStreet.

FXStreet and the author do not provide personalized recommendations. The author makes no representations as to the accuracy, completeness, or suitability of this information. FXStreet and the author will not be liable for any errors, omissions or any losses, injuries or damages arising from this information and its display or use. Errors and omissions excepted.

The author and FXStreet are not registered investment advisors and nothing in this article is intended to be investment advice.

Feed news Join Telegram

Recommended content


Recommended content

Editors’ Picks

AUD/USD bears trying hard to keep reins below 0.7000, US/China inflation eyed

AUD/USD bears trying hard to keep reins below 0.7000, US/China inflation eyed

AUD/USD remains depressed around the intraday low near 0.6955 as sellers keep reins for the second consecutive day ahead of the key US inflation data. Firmer China CPI may offer intermediate help but US inflation is crucial amid strong jobs report, hawkish Fedspeak.

AUD/USD News

EUR/USD struggles to defend 1.0200 as sour sentiment teases DXY bulls ahead of US inflation

EUR/USD struggles to defend 1.0200 as sour sentiment teases DXY bulls ahead of US inflation

EUR/USD fades the corrective pullback from 1.0202 around 1.0215 as traders turn cautious ahead of the key US CPI during the initial hour of Wednesday’s Asian session. Also exerting downside pressure on the major currency pair are the economic fears surrounding the Eurozone.

EUR/USD News

Gold aims to recapture $1,800 as investors trim US Inflation forecasts

Gold aims to recapture $1,800 as investors trim US Inflation forecasts

Gold price is displaying a volatility contraction after printing a fresh monthly high at around $1,800.00 on Tuesday. The precious metal witnessed a decent north-side move on Tuesday and later on turned sideways ahead of US CPI.

Gold News

Crypto Sleeping Giants: Hedera Hashgraph price could shock the world

Crypto Sleeping Giants: Hedera Hashgraph price could shock the world

HBAR price shows a drop in volume amidst the current downtrend. Hedera Hashgraph has the potential to rally towards 2000%. Traders should keep the smart contract alternative token on their watchlists and consider a dollar cost average approach for investing. 

Read more

FXStreet Premium users exceed expectations

FXStreet Premium users exceed expectations

Tap into our 20 years Forex trading experience and get ahead of the markets. Maximize our actionable content, be part of our community, and chat with our experts. Join FXStreet Premium today!

BECOME PREMIUM

Forex MAJORS

Cryptocurrencies

Signatures