Mobile payments company Block (SQ) will report fourth quarter results after the close on Thursday with investors focused on the company’s integration of its Afterpay acquisition and the state of its crypto business.
Shares of the company formerly known as Square were down about 1% ahead of these results.
Here are headline expectations for the company’s quarter, according to data from Bloomberg:
In the third quarter, Block reported revenue of $4.52 billion with gross profits totaling $1.57 billion, beating Wall Street expectations.
Block’s point-of-sale merchant business, Square, which accounted for 45% of total gross profit last quarter, is expected to grow less than 1% in the fourth quarter with profits expected to hit $790 million. In Q3, Square’s gross profits totaled $783 million.
Monthly active users for Block’s Cash App are anticipated to grow to 51 million, up 14% from last year and 4% over the prior quarter. Cash App’s gross profits are expected to top Square’s for the first time since early 2021, with Wall Street forecasting gross profits of $799 million for this business.
Analysts will also be keen for an update on the company’s crypto-related efforts and its continued integration of Afterpay, which it purchased for $29 billion in the summer of 2021.
“Afterpay has not only underperformed, but we’ve seen no measurable progress on synergies. However, we still think this deal can work and the trends improved slightly last quarter,” Chris Brendler, a senior equity analyst with D.A. Davidson said in a Thursday note.
“We see potential for more encouraging trends in 4Q even as macro headwinds intensify,” he added.
D.A. Davidson has a Buy rating and $130 price target on shares of Block.
In the third quarter, Cash App’s bitcoin business generated $37 million in gross profit on $1.76 billion in revenues, which represent the amount of bitcoin the company sold to customers during the quarter. In its Q3 shareholder letter, Block said the declines in revenue and profit for its bitcoin business was driven by a drop in consumer demand and the price of bitcoin.
Despite a strong start to the year for crypto markets, Thursday’s results will reflect the end of 2022 which saw crypto markets rocked by the rapid collapse of FTX.
Click here for the latest crypto news, updates, values, prices, and more related to Bitcoin, Ethereum, Dogecoin, DeFi and NFTs
Read the latest financial and business news from Yahoo Finance
Download the Yahoo Finance app for Apple or Android
Follow Yahoo Finance on Twitter, Facebook, Instagram, Flipboard, LinkedIn, and YouTube
,,,
