Block’s (NYSE:SQ) “Buy Now, Pay Later” (BNPL) platform, Afterpay, has entered into a strategic partnership with e-commerce technology company Rokt to enhance the online shopping experience for consumers.

This collaboration enables Afterpay and its retail partners to deliver targeted advertising experiences to customers during the checkout process, utilizing Rokt’s e-commerce solution. Additionally, it facilitates the provision of highly relevant checkout offers, contributing to the enhancement of customer lifetime value.

The move positions Block well to strengthen its presence in the global e-commerce space, which is anticipated to reach $16.24 trillion by 2028, exhibiting a CAGR of 15.8% between 2023 and 2028, according to a Mordor Intelligence report. A Grand View Research report forecasts a CAGR of 15% for the global e-commerce market during the period 2023-2030.

While the partnership holds growth prospects, concerns remain regarding product development expenses, increasing competitive scenarios, and foreign exchange headwinds. Despite these challenges, Square has lost 10.4% in the year-to-date period, underperforming the industry’s rally of 32.1%.

Block’s Afterpay platform has been actively engaging in collaborative efforts to strengthen its position. Recently, it partnered with Rite Aid to offer flexible payment options for essential household items at over 2,000 locations nationwide. Afterpay also collaborated with prominent retailers such as Boden, Fresh, LuluandGeorgia, Quince, Swarovski, and Wolverine Worldwide, enabling online shopping with flexible payment options.

Furthermore, Afterpay joined forces with Nift Networks to launch an exclusive rewards program, providing customers with opportunities to discover and try new products and services.

These strategic moves are expected to contribute to Afterpay’s growth trajectory, influencing Block’s overall financial performance positively. In the third quarter of 2023, Square reported total revenues of $5.62 billion, marking a 24.4% year-over-year increase. The Consensus Estimate for fourth-quarter 2023 revenues stands at $5.63 billion, indicating a 21.1% year-over-year growth. Block expects gross profit between $1.96 billion and $1.98 billion for the fourth quarter of 2023, reflecting year-over-year growth between 18% and 19%.

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