Proactive Investors - Block Inc (NYSE:SQ) reported better-than-expected results for the first quarter of CY24, prompting Wedbush to be optimistic about Block's performance and strategic initiatives.
In particular, analysts at the research house were bullish about the strong performance of its CashApp platform and its focus on improving profitability and user experience across its various segments.
During the quarter, the Cash App and Square (NYSE:SQ) owner posted a 19% jump year-over-year in revenue to $5.96 billion, ahead of estimates of $5.75 billion.
Block improved both its Square/Merchants and CashApp/Consumers segments compared to the previous quarter, but the company’s outperformance in gross profit is attributed mainly to the performance of the CashApp platform, reflecting its growing significance within the company.
Cash App revenue stood at $4.17 billion compared to the Financial Services (FS) segment's $3.45 billion, marking a 23% year-over-year increase.
“The top priority for Cash App is to bank its existing base, as well as focus on product development and go-to-market strategies,” Wedbush analysts wrote.
Within the Merchants segment, SQ is concentrating on design, engineering, and reliability. This focus is expected to result in new product introductions, streamlining of onboarding processes, and targeting specific sectors like food and beverage through the launch of a single app.