Payments fintech Block extends gains after strong earnings forecast

By Thomson Reuters Feb 23, 2024 | 6:23 AM

(Reuters) – Shares of Jack Dorsey-led Block jumped 15% before the bell on Friday, extending gains from the previous session, as cost cuts helped the payments firm forecast first-quarter core earnings above Wall Street expectations.

The stock was trading at $78.92, and on track to add nearly $7 billion to the company’s market value if gains hold.

Block has been looking to lower costs and drive “profitable growth” in the business by cutting jobs and reducing its real estate footprint.

The company forecast adjusted core earnings between $570 million and $590 million for the first quarter on Thursday, compared to analysts’ estimates of $511.8 million, according to LSEG data.

Block also raised its full-year profit outlook by more than $200 million, forecasting 2024 earnings of at least $2.63 billion, or at least 15% growth from the previous year.

At least six brokerages raised their price targets on Block’s shares. More than 75% of the brokerages covering the stock have a “buy” or higher rating.

(Reporting by Mehnaz Yasmin in Bengaluru; Editing by Shounak Dasgupta)