Why payments provider Block’s stock fell on Friday

Block (XYZ) shares fell on Friday after the fintech company’s quarterly results fell short of Wall Street’s expectations for both top and bottom lines.

The stock fell nearly 8%, making it one of the S&P 500’s biggest losers on Friday. He reads Investopedia Complete coverage of the daily markets here.

Block reported adjusted earnings of 54 cents per share on revenue that rose about 2% year over year to $6.11 billion in the third quarter. Both numbers were lower than analysts’ estimates. The payment services provider’s gross profits rose 18% to $2.66 billion. Cash App’s gross profit growth of 24% accounted for the majority of those gains, while gross profit in the Square payments unit increased by a more modest 9%.

Block raised its full-year guidance, citing strong trends across the business. The company now expects gross profit to reach $10.24 billion, up from its previous estimate of $10.17 billion. Block also raised its full-year adjusted operating income forecast to $2.056 billion from $2.03 billion.

However, investors focused on its earnings loss and higher expenses, including a roughly $70 million increase in general and administrative costs that the company attributed in part to an “in-person corporate event.” According to Block, general and administrative expenses would have been roughly flat year over year without this event.

With Friday’s decline, Block shares have lost nearly a quarter of their value since the beginning of the year.

This article has been updated since it was first published to reflect the most recent stock prices.