XYZ Stock Plunges 16% Late as Block Falls Short on Q1 Earnings

Block (XYZ) stock has cratered more than 16% in after-hours trading this Thursday, after the fintech company’s first-quarter 2025 results fell significantly short of market expectations. Q1 adjusted earnings of $0.56 per share missed analysts’ forecasts of $0.98, while Block’s revenue of $5.77 billion fell below the anticipated $6.21 billion. 

The company's gross profit growth of 9% year-over-year to $2.29 billion also underperformed, primarily due to weakening performance in the Cash App segment, which showed lower customer inflows and reduced spending in discretionary categories like entertainment and travel. 

Bitcoin Flops; Square Props Up Block

The quarterly performance was further impacted by a substantial 60% drop in profit, partially attributed to a $93.4 million remeasurement loss on Bitcoin (BTCUSD) investments, contrasting sharply with a $233.4 million gain in the previous year. In response to these challenges and a more cautious macroeconomic outlook, Block revised its full-year 2025 gross profit guidance downward to $9.96 billion from the previously projected $10.18 billion.

Despite these setbacks, the Square segment demonstrated resilience, maintaining consistent growth rates and achieving market share gains across key verticals. Management remains committed to strategic initiatives, including the expansion of Cash App Borrow and the introduction of new features for Square sellers, while focusing on efficiency and margin expansion for the remainder of 2025.

What’s Next for XYZ Stock?

The results highlight Block's ongoing challenges in monetizing its growing user base and payment volumes in an increasingly competitive fintech landscape. Looking ahead, the company faces mounting concerns about reduced consumer spending amid trade tensions, though CEO Jack Dorsey has expressed commitment to accelerating growth in the second half of 2025. 

Going forward, management’s ability to leverage its Cash App and Square ecosystems for sustainable profitability remains crucial, as investors closely monitor Block's execution of growth initiatives and margin expansion plans. 

As for Friday’s session, though, it’s all setting the stage for an extremely harsh rejection for XYZ stock from its 50-day moving average.