03:35 PM EDT, 05/02/2025 (MT Newswires) -- Block (XYZ) logged disappointing first-quarter results amid "woes" at its Cash App payment service, RBC Capital Markets said in a note e-mailed Friday, as the company's stock slumped.

The payments company late Thursday reported per-share adjusted earnings of $0.56 for the March quarter, up from $0.47 a year earlier, but well below Wall Street's expectations for $0.97. Revenue fell to $5.77 billion from $5.96 billion, lagging the Street's $6.19 billion views.

Cash App gross payment volume, or GPV, plunged 32% to $2.7 billion, while gross profit totaled $1.38 billion. Both metrics missed RBC and the Street's projections, the brokerage said in a note to clients.

Cash App gross profit growth came in below the company's own projections, driven mainly by "softer inflows" and Cash App card spend than expected, Block said in a shareholder letter late Thursday. "We saw changes to consumer spending as the quarter progressed that we believe drove the majority of our forecast miss."

Cash App disappointed on "nearly every metric," RBC analyst Daniel Perlin wrote in the note. The card spend weakness is likely tied to "pressure" on the low-income consumer, Perlin said.

The brokerage cut its price target on the Block stock to $63 from $86, with an outperform rating.

The company's shares was down nearly 21% in Friday late-afternoon trade. The stock has tumbled 45% so far this year.

Block now anticipates $9.96 billion in gross profit for 2025, down from its previous guidance of $10.22 billion. The updated guidance factors in "a more cautious stance on the macro outlook," it said. The company said it expects Block and Cash App gross profit growth to "significantly accelerate" beginning in the third quarter.

"Removing macro volatility, we believe we're now focused on all the right drivers to call this the bottom," according to the letter.

Block said it expects consolidated gross profit to increase 9.5% year over year to $2.45 billion in the second quarter, while seeing the metric's expansion pace accelerating "meaningfully" in the second half of the year.

"While GPV growth slowed meaningfully, April showed some improvement," Perlin said. "Square banking products continue to be a meaningful anchor in gross profit growth, which could offer up some insulation from pressure on GPV."

Price: 46.46, Change: -12.02, Percent Change: -20.55