From Nasdaq, Inc.:



Fintech company Block (formerly Square) has diversified revenue streams, with Bitcoin accounting for 43% of its year-to-date revenue, and hardware sales making up only 0.7%. Both hardware and Bitcoin have low gross margins. However, the company sees hardware as a way to expand its merchant base and Bitcoin as a way to increase its consumer user base. Its fastest-growing revenue stream are subscription and services, with a gross margin of 81%. As the company’s merchant base and Cash App users grow, it expects to generate more transaction and subscription revenue, boosting its gross profit. Though low-margin services open the door to better things, opening the future bright for Block. On the downside, Stock Advisor did not include Block in the list of 10 best stocks to invest in, though its Stock Advisor service has outperformed S&P 500 since 2002. Overall, investors should track Block’s growth in the merchant base and Cash App user base, as this may be more important than evaluating its financials, given the company’s diverse revenue streams.



Original: Block Got Its Start Selling Payment-Processing Hardware, but That’s Now Less Than 1% of the Business. You’ll Never Believe What Its Top Revenue Stream Is Now.