Shares in Block Inc. plunged over 18% in after-hours trading today after the financial services company missed on earnings, lowered guidance and warned of macroeconomic headwinds in its fiscal 2025 first quarter results.

For the quarter that ended on March 31, Block reported adjusted earnings of 56 cents per share, up from 47 cents per share in the same quarter of 2024, on revenue of $5.66 billion, down 3% year-over-year. Both figures were misses, as analysts had been expecting earnings of 98 cents and revenue of $6.21 billion.

Across Block’s segments, the company saw Square’s gross payment volume in the quarter grow 7.2% year-over-year to $54.1 billion, but notably, the figure was down from $58.9 billion in the previous quarter. Block’s CashApp service remained steady, seeing 57 million monthly activities, the same as the previous quarter and the same quarter of last year. However, CashApp did see some financial growth, with gross profit per monthly transacting user growing 9% to $81.

Block’s Buy Now, Pay Later vertical saw gross merchandising value grow 19%, to $10.3 billion and the segment’s gross profit grew 23%, to $298 million. Total cryptocurrency revenue in the quarter came in at $2.43 billion and gross profit from cryptocurrency was $68 million.

The company saw its total gross profit in the quarter rise 9% year-over-year to $2.09 billion — healthy growth but short of the $2.32 billion expected by analysts.

Business highlights in the quarter included Block’s expansion of its Buy Now, Pay Later offerings through Cash App Afterpay. In March, the company began rolling out Afterpay’s “Pay Over Time” feature within the Cash App, allowing eligible customers to split purchases over time when shopping online at partner merchant sites. Additionally, Block started integrating Afterpay into the Cash App debit card, allowing cardholders in 20 states to utilize BNPL options directly through their cards.

On the tech side, Block announced plans to deploy the Nvidia DGX SuperPOD with DGX GB200 systems, becoming the first company in North America to adopt the advanced artificial intelligence infrastructure. The deployment is intended to support the research and training of open-source generative AI models, focusing on developing novel capabilities in underexplored areas.

Looking forward, Block expects gross profit in the second quarter to be $2.45 billion and $9.96 billion for the full year. Both fell short of the $2.54 billion and $10.2 billion forecast by analysts.

“We recognize we are operating in a more dynamic macro environment, so we have reflected a more cautious stance on the macro outlook into our guidance for the rest of the year,” Block wrote in a letter to shareholders. “We expect to accelerate gross profit growth meaningfully in the second half of the year as we execute on our strategies to deepen engagement with Cash App customers as we expand Borrow and retroactive BNPL to more customers.”

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