Bitcoin Revenue Declines Amid Price Drop

Block Inc., led by former Twitter CEO Jack Dorsey, announced a Bitcoin revenue of $1.83 billion for Q4, which is a 7% drop compared to the same quarter last year. The culprit behind this decline? The notorious roller coaster that is Bitcoin’s price, which plummeted around 65% in 2022. Talk about a rough ride!

Cash App’s Performance: A Double-Edged Sword

The payment processing app, Cash App, is a key player in Block’s Bitcoin revenue generation. While it supports transactions via the Bitcoin Lightning Network since late October, the boost didn’t stop the cash flow slump. The app reported a 25% year-on-year dip in Bitcoin gross profit, landing at a modest $35 million in the quarter.

Yearly Trends: The Bigger Picture

If we zoom out to look at the full year, well, it isn’t a rosy picture either. Cash App managed to generate $7.11 billion in Bitcoin revenue and $156 million in gross profit, reflecting a 29% and 28% fall from 2021, respectively. Perhaps time to rethink that Bitcoin acceptance party?

Block Inc.’s Financial Health: Losses but Gains

Despite the setback in Bitcoin revenue, Block Inc. reported a widened net loss of $114 million for the quarter, up from a $77 million loss a year ago. On the bright side, adjusted earnings before interest, tax, depreciation, and amortization (EBITDA) soared by 53% to $281 million. So, while they might be losing money, they’re picking up steam in other areas. Can we say silver lining?

Market Reactions: A Surprising Turnaround

Surprisingly, shares of Block Inc. saw a leap post-earnings report. Analysts linked this unexpected jump to the company’s overall gross profit growth, which was up 40% compared to last year. It seems good news does travel fast, even in the world of bear markets.