Block CEO Jack Dorsey confirms Afterpay to morph into Cash App
Make us a preferred source
Make us a preferred source on Google
More news: In a letter to Block shareholders on Friday, CEO Jack Dorsey revealed that one of his major priorities this year was to replace the Afterpay brand with Cash App, confirming initial reports by Capital Brief.
What they said: “Our focuses in 2024 and beyond will be: 1) further integrating Afterpay into Cash App, 2) continuing to scale merchant discovery in Cash App, 3) using Afterpay’s distribution to continue growing Cash App Pay and 4) leveraging Cash App Card to distribute BNPL (e.g. Afterpay powering BNPL on the Cash App Card),” Dorsey wrote.
"Finally, we will package all of this functionality together into a simple offering that makes it straightforward for customers to start banking with us and makes it easy for Cash App to go-to-market and acquire customers who will choose us as their primary provider of banking services.”
Block shares climb on ASX after bullish forecast
More news: ASX-listed shares of Afterpay parent Block surged more than 16% to $118.02 in early trading after it reported a surprise fourth-quarter profit and outlined March quarter earnings above market estimates.
The local price gains tracked a 12% jump in Block's New York-listed shares in after-market trade following the announcement.
Block shares surge as it swings to profit
The news: US-listed fintech giant Block, which owns Afterpay, has reported a surprise fourth-quarter profit and forecast earnings above market estimates.
The numbers: The company posted a net profit of USD178 million ($271.5 million) for the December quarter, up from a USD114 million loss a year ago. Net revenue jumped 24% to USD5.77 billion.
The company expects adjusted core earnings between USD570 million and USD590 million for the three months ending March 2024 — better than analysts' average expectation of USD511.76 million.
Block shares surged 12% in after-market trade in New York following the announcement.
The context: Block said its BNPL platform, which includes Afterpay, contributed $US325 million of revenue and USD242 million of gross profit to the Cash App business, up from USD264 million revenue and USD196 million profit a year ago.
Block acquired Australian buy now, pay later pioneer Afterpay in August 2021 in an all-scrip deal but has cut hundreds of jobs in recent months in an effort to trim headcount and reduce costs.
What they said: "We’ve done a lot recently to reduce our costs. Now we’re going to focus on growth," CEO Jack Dorsey said in a letter to shareholders.
He noted that Block is below its cap of 12,000 employees and intends to stay that way until “we feel it’s holding us back."
The sources: Block announcement, Block shareholder letter
