Block, the Bitcoin-focused fintech company led by Jack Dorsey, released its Q3 2023 earnings report on November 2, revealing impressive results that surpassed analysts' expectations. During the third quarter of 2023, the company reported a total revenue of $5.62 billion, which included $44 million in Bitcoin profits. This significant contribution from Bitcoin came as a result of strong revenue growth from both Cash App and Square Holdings, driven by the recent surge in cryptocurrency prices.
In a shareholder letter, Jack Dorsey outlined the company's strategic focus and future plans, with specific emphasis on Square. He also provided key financial metrics for the third quarter, highlighting that the company has authorized $1 billion in stock repurchases to offset potential dilution caused by equity incentives.
Block's impressive financial performance continued in the third quarter, with a gross profit of $1.9 billion, marking a 21% year-on-year increase. Cash App, the mobile payment service, contributed $984 million in gross profit, showing a 27% year-on-year growth, while Square's gross profit reached $899 million, a 15% year-on-year increase. Notably, Bitcoin revenue accounted for approximately 43% of Block's total revenue of $5.6 billion. The fintech firm's Q3 growth was boosted by strong consumer demand and an aggressive spending approach.
Block reported a Bitcoin gross profit of $45 million, marking a 22% increase compared to the previous year. During the quarter, the company sold $2.42 billion worth of Bitcoin to its customers through Cash App. The Bitcoin gross profit represented 2% of the company's Bitcoin revenue, and it was primarily driven by the rising average market price of Bitcoin and an increase in the number of Bitcoins sold to customers.
Furthermore, Block noted that it did not experience any impairment losses on its Bitcoin holdings since the previous quarter. As of September 30, 2023, the company's investment in Bitcoin had a carrying value of $102 million, but its fair value, based on observable market prices, was $216 million, exceeding the carrying value by $114 million.
