Stock of the day: Block
Block's first quarter earnings missed estimates amid muted consumer spending, sending its shares sharply lower as the company cuts its 2025 profit forecast.

(AI video summary)
This video was created on 2 May 2025 for IG audiences by ausbiz.
ASX code: SQ2
Block misses first quarter estimates
Block, the Afterpay owner, reported first quarter profit of just under $190 million (30 cents per share) compared with $472 million (74 cents per share) a year earlier. The payments firm cut its profit forecast for 2025, now anticipating 12% growth in gross profit year-on-year, down from 15%.
This disappointing result caused Block's share price to fall approximately 19% in extended trading on Wall Street, with an initial drop of around 33% during early trading before recovering somewhat.
Consumer spending concerns
Analysts highlighted several challenges facing Block, including upcoming debt repayment obligations. The company has convertible notes worth billions of dollars maturing in the next two to three years, raising questions about funding requirements.
More broadly, Block's performance is seen as an indicator of fragility in US consumer spending. Supply chain disruptions in America, particularly in California ports, suggest potential retail inventory shortages in coming weeks.
Rising unemployment and bad debt risks
Industry veterans note that rising unemployment typically leads to disproportionately higher bad debt rates for payment processors. When employment levels drop, financial services companies face both higher collection costs and lower collection success rates.
Given these multiple headwinds, market analysts recommend caution regarding Block's near-term prospects, suggesting these challenges may take several months to resolve.
News and trade ideas
Gold
-
The trade: US Tech 100 rebounds as Australia 200 holds firm
IG's Tony Sycamore analyses the US Tech 100 and ASX 200 as markets react to earnings and eased US-China trade tensions.Forex
This information has been prepared by IG, a trading name of IG Australia Pty Ltd. In addition to the disclaimer below, the material on this page does not contain a record of our trading prices, or an offer of, or solicitation for, a transaction in any financial instrument. IG accepts no responsibility for any use that may be made of these comments and for any consequences that result. No representation or warranty is given as to the accuracy or completeness of this information. Consequently any person acting on it does so entirely at their own risk. Any research provided does not have regard to the specific investment objectives, financial situation and needs of any specific person who may receive it. It has not been prepared in accordance with legal requirements designed to promote the independence of investment research and as such is considered to be a marketing communication. Although we are not specifically constrained from dealing ahead of our recommendations we do not seek to take advantage of them before they are provided to our clients.

Explore the markets with our free course
Discover the range of markets you can trade CFDs on - and learn how they work - with IG Academy's online course.
Turn knowledge into success
Practice makes perfect. Take what you’ve learned in this shares strategy article, and try it out in your demo account.
Ready to trade shares?
Put the lessons in this article to use in a live account. Upgrading is quick and simple.
- Trade over 11,000 popular global stocks
- Protect your capital with risk management tools
- Trade on 140+ key US stocks out-of-hours, so you can react to news
Inspired to trade?
Put the knowledge you’ve gained from this article into practice. Log in to your account now.
Live prices on most popular markets
- Forex
- Shares
- Indices