Cash App’s quarterly Bitcoin sales approach $2.2 billion, up 25% year over year
Miles Suter, Bitcoin Product Lead for Cash App, speaks on stage at the Bitcoin 2022 conference in Miami. Marco Bello—Getty Images
Block, the Jack Dorsey-led digital payments giant, on Thursday announced a 25% year-over-year increase in Bitcoin sales on its Cash App, one of its flagship products.
In the first quarter of 2022, when Bitcoin’s price fell from an all-time high just months earlier, customers bought about $1.73 billion of the cryptocurrency. A year later, when Bitcoin was nearing its recent low, sales were nearly $2.16 billion.
However, what Block brought in through Bitcoin sales was small compared to the total gross profit of the company, which also owns the popular business platform Square. In the first quarter of 2023, Block’s gross profit was $1.71 billion, while it only made $50 million from Bitcoin sales in the same period, still a 16% year-over-year increase.
The increase was driven by an “increase in the amount of Bitcoin sold to customers, partially offset by a decrease in the market price of bitcoin,” Block wrote in his shareholder letter. Last quarter, it reported $1.83 billion in Bitcoin sales, down 7 percent year-over-year.
The increase in Bitcoin sales in the first quarter was accompanied by a rosy earnings report. Analysts, according to The Wall Street Journal, Block predicted would report earnings per share of 35 cents. Instead, the payments firm reported earnings per share of 40 cents, and first-quarter revenue rose 26% year-over-year.
In after-market trading, the shares rose approx. 4% to approx. 62 dollars.
The positive earnings report for Block, formerly known as Square, is a breath of fresh air for its executives as the company has struggled to escape the shadow of a damning report by short-seller Hindenburg Research published in late March. Among other claims, the activist investment firm known for devaluing India’s largest company claimed that Block misled investors on key figures and turned a blind eye to criminals using the Cash App. The company’s shares fell more than 20% after the report’s release.
“We intend to cooperate with the SEC and explore legal action against Hindenburg Research for the factually inaccurate and misleading report they shared about our Cash App business today,” Block wrote in response to Hindenburg’s allegations at the time. “We will not be distracted by typical short seller tactics.”
