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Dec 31, 2019
Block Inc. Q4 2019 Earnings Report
Square, Inc. drove strong revenue growth and invested in long-term growth during the fourth quarter of 2019.
Key Takeaways
In the fourth quarter of 2019, Square's total net revenue grew 41% year over year to $1.31 billion, and gross profit grew 39% year over year to $527 million. Net income was $391 million, which included a gain of $373 million from the sale of Caviar. Excluding the gain on sale, net income was $17 million.
Total net revenue and gross profit grew 41% and 39% year over year, respectively.
Excluding Caviar, total net revenue and gross profit grew 46% and 42% year over year, respectively.
Cash App growth remained strong with total net revenue and gross profit increasing 147% and 104% year over year, respectively.
Cash App had approximately 24 million monthly active customers in December 2019, achieving 60% year-over-year growth.
Revenue by Segment
Forward Guidance
Square provided guidance for Q1 2020 and full year 2020, reflecting strong revenue and gross profit growth.
Positive Outlook
- Total net revenue for Q1 2020 is expected to be $1.34 billion to $1.36 billion.
- Gross profit for Q1 2020 is expected to be $550 million to $560 million.
- Adjusted EBITDA for Q1 2020 is expected to be $95 million to $100 million.
- Adjusted EPS (diluted) for Q1 2020 is expected to be $0.16 to $0.18.
- Total net revenue for 2020 is expected to be $5.9 billion to $5.96 billion.
Challenges Ahead
- Net income (loss) per share for Q1 2020 is expected to be $(0.03) to $(0.01).
- Operating expense base will increase in the first quarter as investments are made in growth opportunities.
- Share-based compensation is expected to increase as a percentage of gross profit compared to 2019.
- Transaction-based costs and bitcoin costs for 2020 are expected to be $3.1 billion to $3.115 billion.
Revenue & Expenses
Visualization of income flow from segment revenue to net income
Historical Earnings Impact
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Avg. Return Before/After Earnings
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