Afterpay owner Block eyes Australia amid global growth push

Ahuja said Block would provide more details on its global ambitions at an investor day on May 18. At the company’s previous quarterly results in February, she also said Australia provided a “significant opportunity to leverage the flag Afterpay has already planted so well, for Cash App.”

Block’s intentions for Australia are relevant to the local banks, with which it already competes through its merchant business, and especially Westpac, which has partnership to provide Afterpay’s banking app.

Shares in Block, which trade as CHESS depository interests on the ASX, were down 1.8 per cent in afternoon trade, following a turbulent session on Wall Street in which technology shares tumbled.

The company’s March quarter results showed earnings before interest, tax, depreciation, and amortisation of $US195 million ($275 million), up slightly on the December quarter.

Block also provided a first look at the contribution of Afterpay, saying the BNPL company had fed $US92 million into gross profit in February and March.

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Block co-founder Jack Dorsey, who also co-founded Twitter, indicated that integrating Afterpay had created some distractions for Block, but he was upbeat about the long-term growth opportunities from the merger.

“We’re really excited about Afterpay and where it goes,” Dorsey said. “We’re still extremely early into this integration. This is the biggest thing our company has ever done, and obviously… it definitely distracts a lot. But we’ve managed to perform through it.“

“We do see a lot of our competitors taking advantage of the fact that we have this integration, but by focusing on the fundamentals and the reason we acquired this company in the first place, which is to connect these two ecosystems.”

Responding to an analyst question, Dorsey also indicated the company could include elements of social media in the Cash App, saying payments were a “very social thing” that people do at least weekly. Afterpay’s Westpac-supported banking app already seeks to bring a “social media style” to banking.

RBC Capital Markets analyst Daniel Perlin said Block’s EBITDA was ahead of market expectations, while gross profit from both the Cash App and merchant businesses beat his forecasts.

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