Block reports revenue miss but a slight beat on earnings

Block reported third-quarter revenue on Thursday that trailed Wall Street expectations. The stock initially sold off after hours but erased most of its losses as investors focused more on profitability metrics.

Here is how the company did, compared to analysts' consensus estimates from LSEG.

Block finance chief Amrita Ahuja told CNBC that analysts focus more on gross profit than revenue and pointed to the company's earnings growth and outperformance relative to expectations.

Block, formerly known as Square, posted $2.25 billion in gross profit, up 19% from a year ago. The company reported net incomeof $283.7 million, or 45 cents per share, after losing $88.7 million, or 15 cents a share, a year earlier.

The Cash App business, the company's popular mobile payment platform and a significant contributor to overall profitability, reported $1.31 billion in gross profit, a 21% year-over-year jump. Block, run by Twitter co-founder Jack Dorsey, said monthly active users of its Cash App Card increased 11% from a year earlier to more than 24 million.

Gross payment volume came in at $62.4 billion, missing analysts' estimates of $64.3 billion. However, the company has improved its cost structure. Gross profit for the fourth quarter will increase 14% to $2.31 billion, Block said.

Going into earnings, analysts were focused on the company's buy now, pay later unit. Block acquired the Australian BNPL firm Afterpay for $29 billion in 2021. 

CEO Jack Dorsey devoted his quarterly shareholder letter to explaining the company's lending products, including Square Loans, Afterpay Buy Now Pay Later and Cash App Borrow. He said the company is looking to transform Cash App Cards "into a better alternative to credit cards" when it launches Afterpay on