Block Inc’s (SQ) shares tumbled early after hours as its Bitcoin revenue flatlined in Q3 compared to the previous year, and total revenues missed Wall Street expectations.
Block shares dropped by 12.3% to a bottom of $66 ten minutes after the closing bell on Nov. 7 after closing the day down 3.05% at $75.27, according to Google Finance.
It’s since recovered to a loss of 1.7% and its share price is up 4.2% so far this year.
The company, which operates the point-of-sale system Square and the retail fintech app Cash App, reported that Q3 revenues rose 6.4% from the year-ago quarter to $5.98 billion, which missed analyst expectations of $6.17 billion by over 3%.
Block’s Bitcoin (BTC) revenue — how much it makes in fees from customers buying the cryptocurrency and its biggest money maker — also flatlined compared to Q3 2023, staying at around $2.43 billion.
The firm also said it is “winding down” its decentralized finance software business TBD and was “scaling back” its investment in music streaming service TIDAL so it could shift money to its crypto services.
“This gives us room to invest in our Bitcoin mining initiative, which has strong product market fit and a healthy pipeline of demand, and Bitkey, our self-custody wallet for Bitcoin,” Block said in a shareholder letter.
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Block did see its quarterly gross profits jump 19% year-on-year to $2.25 billion with a net income of $283.7 million, in line with analyst estimates.
Its revenue miss comes as Bitcoin traded relatively flat through the third quarter, which ran from July through to Sept. 30, as it hovered around an average price of $60,000.
The cryptocurrency has since gone on to continually break new highs, with its current peak touching $1 below $77,000 on Nov. 7, per TradingView.
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