Block, Inc. stock research
FY2025 Q1
Block (XYZ) Gross Margin — Quarter Ended Mar 31, 2025
Revenue and cost of revenue both decreased from the previous quarter, while gross profit remained stable, leading to an improvement in gross margin. Compared to the same quarter a year earlier, revenue was lower and cost of revenue declined more sharply, resulting in higher gross profit and a stronger gross margin.
Gross margin takeaway
Quarter ended Mar 31, 2025 · FY2025 Q1
Revenue and cost of revenue both decreased from the previous quarter, while gross profit remained stable, leading to an improvement in gross margin. Compared to the same quarter a year earlier, revenue was lower and cost of revenue declined more sharply, resulting in higher gross profit and a stronger gross margin.
- The gross margin improved sequentially and year-over-year, driven primarily by a proportionally larger decline in cost of revenue relative to revenue. The strongest observable driver is the reduction in cost of revenue, which has outpaced the change in revenue.
- Compared to the prior quarter, gross margin strengthened as cost of revenue dropped while gross profit held steady. Versus the year-ago quarter, gross margin improved substantially, with both a lower revenue base and a more significant decrease in cost of revenue.
Gross margin snapshot
The selected quarter's reported revenue, gross profit, direct costs, and margin comparisons.
Gross margin
39.7%
Gross profit
$2.3B
Revenue
$5.8B
Cost of revenue
$3.5B
Quarter-over-quarter change
+1.4 pts
Year-over-year change
+4.5 pts
Quarterly gross margin trend
A four-quarter view of the revenue and direct-cost bridge behind gross margin.
| Period | Revenue | Gross profit | Cost of revenue | Gross margin |
|---|---|---|---|---|
| Jun 30, 2024 | $6.2B | $2.2B | $3.9B | 36.3% |
| Sep 30, 2024 | $6.0B | $2.2B | $3.7B | 37.6% |
| Dec 31, 2024 | $6.0B | $2.3B | $3.7B | 38.3% |
| Mar 31, 2025 | $5.8B | $2.3B | $3.5B | 39.7% |
Quarterly comparisons
Compare the selected margin with the preceding quarter and the same fiscal quarter one year earlier.
Previous-quarter change
Dec 31, 2024
+1.4 pts
Year-over-year change
Mar 31, 2024
+4.5 pts
What the margin says
Filing-constrained interpretation of margin direction, comparisons, and what to monitor next.
The gross margin improved sequentially and year-over-year, driven primarily by a proportionally larger decline in cost of revenue relative to revenue. The strongest observable driver is the reduction in cost of revenue, which has outpaced the change in revenue.
Compared to the prior quarter, gross margin strengthened as cost of revenue dropped while gross profit held steady. Versus the year-ago quarter, gross margin improved substantially, with both a lower revenue base and a more significant decrease in cost of revenue.
Monitor whether the reduction in cost of revenue is sustainable in subsequent quarters, as it is the primary factor behind the gross margin improvement.