Shares in Block Inc. declined slightly in after-hours trading today after the financial services company fell short on revenue in its fiscal third-quarter but reported slightly better-than-expected earnings.

For the quarter ended Sept. 30, Block reported adjusted earnings per share of 88 cents, up from 50 cents per share in the same quarter of last year, on revenue of $5.98 billion, up 6% year-over-year. Earnings were ahead of the 87 cents per share expected by analysts, while revenue fell short of an expected $6.24 billion.

Block saw a gross profit of $2.25 billion in the quarter, up 19% year-over-year and net income of $283.7 million, up from a loss of $88.7 million in the third quarter of 2023.

The company’s growth was driven by its Cash App business, which saw a 21% increase in profitability to $1.31 billion, in part driven by Cash App card monthly active users increasing by 11% to over 24 million. Block’s Square business also grew, up 16% year-over-year to $932 million. The company reported operating income of $323 million and adjusted operating income of $444 million for the quarter.

“We outperformed our gross profit and profitability guidance in the third quarter of 2024,” Chief Executive Jack Dorsey said in a long letter to shareholders — a man who, despite being a co-founder of Twitter, seems to have forgotten that brevity is the soul of wit. “Cash App continued its strong performance, driven primarily by growth in inflows per active and an increase in monetization rate.”

For its fiscal fourth quarter, Block expects a gross profit of $2.31 billion and, for the full year, $8.89 billion.

Separately, Block also revealed that it was in discussions with several money transmission license regulators regarding its compliance program, including its anti-money-laundering program.

The earnings report also comes as Block and Dorsey may have become partially embroiled in the ongoing scandal involving singer P-Diddy. According to Fortune, company employees have been told not to discuss prominent board member Jay-Z given his purported friendship with P. Diddy, who is currently in prison on sex trafficking and other charges.

Also notable is that Dorsey is reported to have turned off the ability for employees to ask questions anonymously at a virtual all-hands meeting. People present also said that the CEO kicked off the meeting by complaining about perceived “negativity” from staff, saying that he wanted more positivity.

Photo: Block