Block’s Cash App, a popular mobile payment service, saw its Bitcoin gross profit skyrocket 90% year-on-year in the fourth quarter of 2023.
Cash App users are flocking to buy and sell Bitcoin, resulting in a total sale of $2.5 billion in Q4, a 37% increase compared to last year. This translated to a whopping $66 million in gross profit for Block from Bitcoin sales, a 90% jump. The full year wasn’t any different, with Bitcoin revenue hitting $9.5 billion, up 34% year-on-year, and gross profit climbing 31% to $205 million.
Cash App, which allows users to easily buy, sell, send, and receive Bitcoin, is a key driver of Block’s success. Its total gross profit in Q4 reached $1.18 billion, reflecting a healthy 25% year-over-year growth.
The increase in revenue and profit can be attributed to two factors: the rising average market price of Bitcoin and Block’s smart strategy of holding onto its Bitcoin inventory, which benefited from price appreciation during the quarter. Currently, Block holds 8,027 BTC worth roughly $413 million.
Block’s earnings report surpassed analyst expectations, sending its shares soaring 5.4%. Overall, the company reported a solid quarter with a gross profit of $2.02 billion in Q4, up 22% year-on-year. For the full year, gross profit reached $7.5 billion, a 25% increase.
Block’s adjusted earnings before interest, taxes, depreciation, and amortization (EBITDA) for the full year also exceeded expectations, coming in at $1.79 billion compared to their own guidance of $1.66 billion to $1.68 billion. This positive performance suggests a strong outlook for the company moving forward.
