Block Inc. (XYZ) reported its second-quarter results after Wednesday's closing bell, and the numbers were better than Wall Street expected. The company beat on both the top and bottom lines, and there's a lot to unpack here.
Let's start with the headline numbers. Block posted quarterly earnings of $1.02 per share, which beat the consensus estimate of 87 cents by a solid 17.24%. Revenue came in at $6.62 billion, also ahead of the analyst forecast of $6.49 billion.
But the real story is in the details of its two main businesses: Cash App and Square.
Cash App had a strong quarter. Commerce Enablement volume grew 17% year over year to $56.5 billion, driven by Cash App Card and BNPL (buy now, pay later). Consumer Lending origination volume jumped 59% year over year to $18.9 billion, thanks to Cash App Borrow, and risk loss rates stayed healthy. PBAs (which stands for peer-to-peer payments, I think) grew 17% year over year, and Cash App had 59 million monthly transacting actives in June.
Square also showed some encouraging signs. Gross payment volume (GPV) grew 13% year over year. What's particularly interesting is that U.S. GPV growth accelerated to 10% year over year, which is the strongest U.S. growth rate since the second quarter of 2023. International GPV also kept up its momentum, growing 28% year over year (25% in constant currency).
CEO Jack Dorsey had some philosophical thoughts to share about the company's direction. He said, "AI will make software creation abundant. Judgment, trust, depth of understanding, and capability will become scarce. Our advantage is that we understand which things matter for the customers we serve, we own the hard capabilities behind them, and we've connected them into a network that compounds with every seller and every customer who joins."
Despite the solid earnings beat, the market didn't seem too thrilled. Block stock was down 4.39% to $80.50 in Wednesday's extended trading, according to data from MarketDash.
So, what's the takeaway? Block is growing, especially in its consumer lending and international Square business. But investors might be looking for even more, or perhaps they're reacting to something else in the report. Either way, it's a mixed bag for the stock right now.
