Jack Dorsey’s Block will debut a Bitcoin-mining chip on 14 August, entering a market dominated by Asian behemoths Bitmain, Canaan, and MicroBT. The new initiative will come just one week after the company reported quarterly earnings that missed Wall Street expectations.
Earnings backdrop and market reaction
The product launch date was confirmed by chief financial officer Amrita Ahuja in an interview with CNBC, and teased by Dorsey on X, simply stating “next week.” Block reported adjusted earnings for the second quarter of 62 cents, below the 69 cents consensus of a group of analysts, while revenue came in at $6.05bn against a consensus forecast of $6.31bn compiled by LSEG (London Stock Exchange Group). Shares initially rose nearly 11 per cent in after-hours trading following news of the mining chip project and after the company increased its full-year profit guidance, before reversing course the next day as enthusiasm cooled and the reality of missed earnings hit.
Hardware and production plans
Block’s mining arm, Proto, has completed the design of a 3-nanometre chip and sent it to a leading global semiconductor manufacturer for production, though the company has not disclosed which. It plans to offer both the chip itself and a complete mining machine, giving US operators the option of building customised rigs or buying a ready-made system.
Block has said manufacturing and assembly will take place in the US, avoiding tariffs and the type of shipping delays that have raised costs and slowed delivery for imported rigs – computer systems used in crypto mining. With about 90 per cent of mining hardware originating in China, according to Block’s US rival Auradine, the move could reduce reliance on overseas suppliers.
Early customer and growth potential
In July 2024, Core Scientific agreed to integrate Proto’s chips into a project delivering about 15 EH/s (exahashes per second) of computing power, providing Block with an industrial scale proving ground from launch. For a newcomer, securing a deployment of that size is unusual in a market where buyers often wait to see equipment in operation before committing.
Block also reported gross profit of $2.54bn for the quarter, up 14 per cent year on year, and raised full-year gross-profit guidance to about $10.17bn. If Proto ships on time and the hardware performs competitively, Block could establish itself as a credible US-based alternative, giving miners more choice and adding a new long-term growth stream alongside its Cash App and Square businesses.
