Today is shaping up to be a disappointing end to the week for the Block Inc (ASX: SQ2) share price.
As we crack the lids on our lunchboxes at midday, the global fintech company is slipping 3.1%, leaving the share price at $86.98. For comparison, the go-to S&P/ASX 200 Index (ASX: XJO) is down a lesser 0.45% to 7,138.7 points in the afternoon.
The Square and Afterpay owner is the second worst-performing company in the benchmark index. Yet, the company has not shared announcements today, and the broader tech sector is performing roughly in line with the ASX 200.
Unplanned outage strikes
If your morning coffee was foiled by the local miracle juice provider requiring that archaic means of exchange we call cash, you've probably witnessed first-hand the disruption triggered by Square's outage.
Square is Block's payment processing, point-of-sale business. Usually, Square's terminals allow small and medium-sized businesses to accept card or mobile payments easily — though not today.
Issues were first acknowledged on the company's website at around 5:00 a.m. AEST today. At that time, Square stated, "We are currently investigating a disruption with Square Services. We'll be back to update as soon as we receive more information from our Engineers."
Follow-on updates informed businesses that a disruption at one of Square's data centres had been identified. In addition, those using the company's devices were recommended to remain logged into their account, not to log out.
The latest update, shared at 12:45 AEST, indicated the issues were still unresolved. Furthermore, it is believed the disruptions are also impacting operations outside of Australia.
Chopping the Block share price
Today's outage follows a destructive stint for the company's share price.
In August, shares fell 23.7% after investors were unsatisfied with Block's quarterly update. Although the figures showed year-on-year improvements in gross payment volume, gross profit, and adjusted EBITDA, it appears the market wanted more.
More recently, analysts at UBS have downgraded the US-listed Block from a buy to neutral. Inside the same broker note, the team sliced its target on the Block share price from US$102 to US$65. Remember, this is the New York Stock Exchange version, not the ASX-listed Block.
Specifically, UBS cited "limited upside potential" with the company exposed to softening of consumer discretionary spending.
