The abbreviation of the cash app shows the shift in consumer behavior

The block shares fell by more than 20%on Friday (May 2), since slow growth has caused management to issue careful instructions.

As Pymnts found in his own reporting, there is a little newly positioned in the works and a strong hug of artificial intelligence (AI) to optimize operations.

But within the data and the comment there is tangible evidence that you change consumer behavior – not only for which you spend your money, but how you spend this money.

The company's additions stated that in the first quarter and the use of cash apps, as in various metrics, was significantly slowed down, since the number of monthly money transactions that use digital items showed growth of 0% compared to the previous year and stagnated with 57 million users. The drilling and the use of the cash app card slowed down to growth of 7% in monthly transactions of active users (25 million), with this growth rate in previous quarters in the percentage points with medium teenagers.

Rails slowly

The inflows that the company describes in its submissions as the funds “in the Cash App ecosystem” have slowed down from 8% to $ 76.8 billion in the first quarter. On an individual basis, the inflows in the last quarter amount to USD $ 1,355 per transactions, which is also due to 8% growth compared to double -digit growth rates.

Reading here is that the users are at least for the time being conservative about how much money they want to work together with the digital wallet as an entry point to the Block Financial ecosystem. The slowdown was enough to arrange several downgrades from Sell-Side in Wall Street, as CNBC stated on Friday-and as a company, Benchmark, wrote: “Stagnation in the number of active users of the app is even more than the reduced expenses of the user.”

As for the reduced expenses, “we have seen changes in consumer behavior that we believe that they have influenced the expenses of the inflows and the money app card,” said CEO Jack Dorsey about the winning call with analysts.

“Tax refunds are an important seasonal driver for cash app. This year we saw a pronounced shift in consumer behavior during the period in which we usually see the greatest payments at the end of February and March,” said Dorsey. “This coincided with the influences under our expectations. In the quarter, the expenditure for non-discretionary money app cards in areas such as food and gas was more resistant, while we saw a more pronounced effects on discretionary expenses in areas such as travel and media. We believe that this consumer softness was an important driver of our prognosis.”

The softness was indicated separately by Pymnts Intelligence data, which shows that 78% of the consumer provides that they were cut back fewer or cheaper goods by buying.

We find that another sign for the shift in consumer behavior through the data on the NOW, Pay later (BNPL) takes place: blocking in the submissions that the BNPL platform gross goods (GMV) reached 7.9 billion US dollars and grew by 16% on a constant currency basis, which shows the complaint of the time loss. Pymnts Intelligence data indicate that BNPL takes on a broader use among consumers and especially with limited consumers who come across cash flow bottlenecks. We found that consumers use BNPL 3.5 times more often with cash flow compromises to make purchases.

However, the dollar volumes in the historical data of the company (a table with the result) shows that the total BNPL -GMV was 7.9 billion US dollars in the first quarter, compared to the $ 10.3 billion in the fourth quarter of last year and in the third quarter of $ 8.2 billion. The seller metrics offer the flip side of the coin, since Square GPV's growth has dropped to 7.2%compared to earlier double-digit quarters.

Block Management expects growth in the following quarters of this year. The use of digital wallets in the center of daily financial life is an unstoppable trend. We have pointed out that, for example, 44% of consumers in the United States use these token pockets before other payment modalities. The general trend towards expanding financial ecosystems can be in the long term, but it has its speed penalty.