Block plunges 20% as Cash App miss triggers downgrades

Core Insights - Block shares experienced a significant decline of over 20%, marking their second-worst day, primarily due to a disappointing quarterly report and multiple analyst downgrades focused on Cash App [1][2] Financial Performance - The company reported a miss in first-quarter earnings across revenue, gross profit, and payment volume, leading to a reduction in full-year guidance due to macroeconomic uncertainty and weaker consumer spending [3] - Cash App generated $1.38 billion in gross profit in the first quarter, reflecting a 10% increase year-over-year, but fell short of the $1.42 billion consensus estimate [4] User Growth and Engagement - Concerns were raised regarding stagnant user growth for Cash App, with monthly active users remaining flat at 57 million and inflows increasing by only 8% despite new features [2][4] - Analysts highlighted that the stagnation in active users is more alarming than the reduction in spending, prompting downgrades from firms such as Wells Fargo and Benchmark [2]