Shares in Block Inc. defied market trends and rose in late trading today despite the company, previously known as Square Inc., missing estimates on earnings and revenue in its latest quarter.

For the quarter ended March 31, Block reported adjusted earnings per share of 18 cents, down from 41 cents per share a year earlier, on revenue of $3.96 billion, down from $5.06 billion year-over-year. Analysts had expected adjusted earnings of 20 cents a share on revenue of $4.14 billion.

The main driver of Block’s decreased revenue in the quarter was a decline in revenue for bitcoin. Excluding bitcoin, total net revenue in the first quarter rose 44%, to $2.23 billion. Bitcoin revenue in the quarter came in at $1.73 billion, down 51% year-over-year, while bitcoin profit was $43 million, down 42%.

Block did try to spin its declining bitcoin revenue, noting that bitcoin revenue and gross profit have grown 138% and 155% on a two-year compound annual growth rate basis. The company blamed the drop on relative stability in the price of bitcoin during the quarter affecting consumer demand and trading activity.

Notably, Block invested $170 million in bitcoin in the quarter, up from $50 million in the previous quarter.

Gross profit in the quarter came in at $1.29 billion, up 34% year-over-year, with a net loss of $201 million, compared with net income of $39 million in the first quarter of 2021 and a loss of $77 million in the previous quarter. Gross payment volume in the quarter came in at $43.5 billion, up 9% year-over-year but down from $46.3 billion last quarter.

Block’s Cash App saw a gross profit of $624 million, up 26% from a year ago. And Square saw 41% year-over-year growth to $661 million.

Subscription-based revenue jumped 72% year-over-year, to $960 million, delivering a gross profit of $764 million, up 63%. That included contributions for the first time from Afterpay Ltd., the Australian “buy now, pay later” firm Block acquired for $29 billion.

Once again, Block did not provide hard outlook figures for the quarter ahead but did provide some predictions about its growth rates. In the quarter, the company expects Square’s gross payment volume to rise 29% year-over-year, with the Cash App also expected to see growth.

Adjusted operating expenses in the quarter are expected to increase by $245 million from the first quarter, or $180 million excluding Afterpay.

Whether it was the strong projected growth figures or something else, investors liked the numbers despite the miss on earnings and revenue. Shares in Block rose more than 44% after the bell.

Image: Block