Financial technology company Block, founded by Twitter co-founder Jack Dorsey, exceeded analysts’ expectations in the first quarter. According to the company’s disclosed financial report, adjusted earnings per share were $0.85, surpassing the market’s general expectation by $0.13. Revenue was $5.97 billion, exceeding Wall Street’s forecast of $5.82 billion. Gross margin grew by 22% compared to the first quarter of last year, reaching $2.09 billion.
It is worth mentioning that Block also stated that it has started purchasing additional Bitcoin using 10% of monthly Bitcoin-related gross profit since April, and plans to increase holdings every month until 2024. According to the first quarter financial report, Block’s Bitcoin-related gross profit was $80 million. If this level of profitability can be sustained in the second half of this year, according to this plan, the company’s balance sheet will increase in value with an additional $24 million worth of Bitcoin.
In fact, Block already held a large amount of Bitcoin before initiating the regular purchase plan. The company had purchased 4,709 Bitcoins in October 2020 and an additional 3,318 Bitcoins at the beginning of 2021, with a calculated value of $590 million. These Bitcoins are currently worth approximately $4.7 billion.
Furthermore, Block also publicly released the Bitcoin financial blueprint of its balance sheet to facilitate other companies to follow suit. The document describes the process by which it can acquire a large amount of cryptocurrency without unduly affecting the market, as well as how it custodies, secures, and accounts for Bitcoin assets. Jack Dorsey stated, “We believe the world needs an open currency protocol, one that is not owned or controlled by any single entity. We believe Bitcoin is the best and only candidate to become that protocol and ultimately the native currency of the internet.”
