Block Inc (NYSE:SQ) shares bounced afterhours on Thursday as the financial services company’s strong first quarter financial results impressed investors.
For Q1, the Cash App and Square owner posted a 19% jump year-over-year in revenue to $5.96 billion, ahead of estimates of $5.75 billion.
Excluding Bitcoin revenue, revenue was $3.23 billion, which marked a 14% increase.
Profit was $472 million or $0.74 per diluted share, above estimates of $0.62.
Gross payment volume was up 6% year-over-year at $54.43 billion, missing Street estimates of $54.9 billion.
CEO Jack Dorsey’s letter to shareholders focused on the company’s Bitcoin efforts, which he noted take up less than 3% of its resources.
He said that going forward, the company would be investing 10% of its gross profit from its Bitcoin products into Bitcoin purchases.
“We were one of the first public companies to put Bitcoin on our balance sheet: we invested $220 million into Bitcoin, and that investment has grown by approximately 160% to $573 million as of the end of the first quarter,” he wrote.
“Our investment in Bitcoin transcends technology; it is an investment in a future where economic empowerment is the norm.”
Dorsey also highlighted Block’s recent announcement that the company plans to introduce an entirely new 3-nanometer ASIC mining chip and an entire mining rig system to meet demand from miners for reliable and US-based mining hardware and software.
“With a standalone mining chip, we will represent the only large, well-capitalized mining hardware vendor with such a solution,” Dorsey wrote.
“We believe this will help unlock mining system innovation and support the much-needed development of new mining system form factors and use cases.”
Following the release of its earnings report, Block shares surged more than 7% to about $75.
Shares of the company had retreated by almost 10% the previous day on reports the Department of Justice is probing the alleged processing of crypto transactions for sanctioned countries and terrorist groups and other compliance failings.