The data: Block's gross payment volume (GPV) reached $53.16 billion in Q4, per its shareholder letter. The 15% year-over-year (YoY) increase is down from 45% the same period a year ago. Q4 gross profits grew 40% YoY, slowing from 47% the prior year.

How we got here: Three factors contributed to Block's Q4 performance.

  • Softer customer spending. US GPV growth within discretionary verticals, primarily restaurants and retail, has been slowing since November, CFO Amrita Ahuja noted on Block's earnings call. This aligns with overall retail spending trends in the US during the last two months of the year.
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