The Block Inc (ASX: SQ2) share price is avoiding the market weakness and pushing higher on Friday.
In morning trade, the payments company's shares are up 1.5% to $91.40.
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Why is the Block share price rising?
Investors have been bidding the Block share price higher today after the payments company released its first-quarter update. Here's how it performed:
- Gross payment volume of US$51.1 billion
- Gross profit up 32% to US$1.71 billion
- Adjusted operating income of US$51 million (up from US$42 million loss)
- Adjusted EBITDA up 89% to US$368 million
- Net loss improved to US$17 million (from US$201 million)
- April gross profit up 24%
What happened during the quarter?
For the three months ended 31 March, Block reported a 32% increase in gross profit to US$1.71 billion. This was driven by 49% increase in Cash App gross profit to US$931 million and a 16% lift in Square gross profit to US$770 million.
The former was underpinned by a 15% in Cash App monthly transacting actives to 53 million, with inflows per transacting active up 8%. Cash App also generated US$50 million in Bitcoin gross profit for the quarter.
As you might have guessed from the Block share price reaction, this result was ahead of the market's expectations.
Outlook
Also giving the Block share price a boost has been news that management expects to deliver adjusted EBITDA of US$1.36 billion in FY 2023. This is up from its previous guidance of US$1.30 billion and is now ahead of the consensus estimate of US$1.32 billion.
Another positive is that Block is now expecting an adjusted operating loss of US$115 million for the year, which is down from its prior guidance for a loss of US$150 million.
