• Block reported strong revenue growth in Cash App and Square.
• The company saw $5.77 billion in revenue for the fourth quarter.

Block stock closed up 16% Friday, a day after the payments company reported fourth-quarter earnings that beat analysts' estimates on gross profit and showed strong growth in its Square and Cash App revenue.

Here's how the company did, compared to analysts' consensus from LSEG, formerly known as Refinitiv:

• Earnings per share: 45 cents adjusted, not comparable to estimates
• Revenue: $5.77 billion vs. $5.70 billion expected

Block posted $2.03 billion in gross profit, up 22% from a year ago. Analysts tend to focus on gross profit as a more accurate measurement of the company's core transactional businesses.

The company raised its adjusted EBITDA forecast to at least $2.63 billion from $2.40 billion.

Block, formerly known as Square, ended the year with 56 million monthly transacting actives for Cash App in December, with most of those customers using it for either peer-to-peer payments or the Cash App Card.

Its Cash App business reported $1.18 billion in gross profit, a 25% year-over-year rise.

The company, which is run by Jack Dorsey, said its Cash App Card has 23 million monthly actives in December, up 20%. That is more than two times the growth rate of total monthly actives.

"We believe this strategy will enable us to build the largest network in the long run, with a highly engaged customer base using Cash App as their primary banking solution," Dorsey said in a note to shareholders.

The payments firm has focused on slimming down operations in recent months. In January, the Block CEO reportedly said in a note to staffers that the company had laid off a "large number" of workers. This followed another round of layoffs in December.

Dorsey said in his note to shareholders that the company was now below a previously set cap of 12,000 employees.

"We're going to operate under this cap until we feel it's holding us back, which is likely years out," Dorsey wrote. The company recorded a $70 million charge for severance costs.

The company also took an $132 million impairment on its investment in music streaming service Tidal. Block and Dorsey have had a mixed dealmaking record. The company sold delivery service Caviar to DoorDash in 2019 in a $410 million cash-and-stock deal. It also acquired Afterpay in 2021 for $29 billion, its largest acquisition ever.

Afterpay has struggled since the deal announcement, posting successive quarters of losses throughout 2022. Dorsey said in his note to shareholders that integrating Afterpay more tightly into Cash App and using it to power Cash App's buy-now, pay-later technology were two focuses for 2024.

Block's strong quarterly results and full-year outlook prompted Wall Street analysts to upgrade their rating of the stock on Friday.

Wells Fargo upgraded Block to overweight and raised its price target from $65 to $95, while Seaport Research Partners upgraded the stock to a buy and also hiked its price target to $95.

"SQ's progress over the past several months in terms of streamlining itself organizationally, sharpening its focus within its two key businesses Square and Cash App, and becoming hyper-focused on driving profitable growth has been impressive," the Seaport Research Partners analysts wrote. "We think there's more to go."

— CNBC's Michael Bloom, Rohan Goswami, Alex Koller and Kate Rooney contributed to this report.

WATCH: Block shares pop on earnings beat