Jack Dorsey's Block Hits $1.29 Billion in Q1 Profit, $43 Million in BTC Trading Profits

Block, a Bitcoin (BTC)-backed company with Cash App, Square, and Afterpay, will continue to grow in 2022. In the first quarter of 2022, gross profit "increased 34% year-over-year," according to its letter to shareholders.

In total, the group netted a gross profit of $1.29 billion. However, operating costs also increased by $1.52 billion in the first quarter of 2022, a 70% year-over-year increase. The group explained that the acquisition of Afterpay, a buy now pay later service, could explain the higher costs.

From January 2022 to March 2022, Block's total net revenue reached $3.96 billion, a decline of 22% compared to 2022. The group confirmed that the decline was "driven by a decline in Bitcoin revenue."

Cash App, the Block’s bitcoin retail store and mobile payment service, continued to sell bitcoin, although the numbers were not as upbeat as in the previous quarter:

"Cash App generated $1.73 billion in Bitcoin revenue and $43 million in Bitcoin gross profit in the first quarter of 2022, down 51% and 42% year-over-year, respectively".

Given that the price of Bitcoin struggled to breach $30,000 in the second quarter, the group will be encouraged by the growth in non-bitcoin revenues in the first quarter, and the Block ecosystem, including Tidal and TBD Group, is not entirely dependent on the performance of the crypto market .

Additionally, Square's ecosystem of merchant payment solutions, including point-of-sale devices, is doing well. It achieved "gross profit of $661 million, up 41% year-over-year."

The quarterly report had 81 mentions of bitcoin and zero mentions of cryptocurrencies, matching Jack Dorsey's bitcoin certification. Additionally, the report states that more than 10 million Cash App accounts have purchased Bitcoin. Cash App does not offer purchases of popular cryptocurrencies such as Ethereum (ETH) or Dogecoin (DOGE).

Announced in April, its U.S.-based customers can use the Cash App to automatically invest a portion of their direct deposit paychecks into Bitcoin, or their “direct deposits” will be automatically converted, the report said.