Adds analyst comments, updates shares in paragraph 6

By Niket Nishant

May 2 (Reuters) - Block's XYZ.N shares fell 22% on Friday and were on track for the biggest intraday decline in five years after a 2025 profit forecast cut raised concerns about the payment firm's key businesses.

The selloff wiped off nearly $8 billion from the Jack Dorsey-led company's market value. At least eight brokerages reduced their price targets on the stock, citing weakness in the company's peer-to-peer Cash App and mounting competition.

Block's forecast cut, which it attributed to macroeconomic uncertainty, raised eyebrows, as financial industry peers have so far reported steady spending trends.

Though concerns persist about a consumer spending slowdown due to U.S. President Donald Trump's chaotic tariff policies, major bank executives have said a strong labor market should support near-term resilience.

Block's Cash App trends are an "outlier", analysts at BTIG wrote in a note, considering peers' performance, and raised the "inevitable question" that whether the app's weakness is cyclical or structural.

Shares of the company were last trading at $45.68, their lowest since November 2023.

"Bear case on Cash App has won out in the near-term," said Jefferies analysts, adding that the company's forecast of 9.5% gross profit growth in the second quarter appeared "incredibly conservative".

SQUARE BUSINESS STRENGTH

Despite weakness in Cash App, analysts said Block's Square segment — which provides payments solutions to small and medium-sized businesses — was a bright spot.

"It is our view that Square is starting to make competitive progress," brokerage William Blair said.

The stock decline could make the stock more attractive, presenting a potential opportunity for investors, it added.

However, a further deterioration in economic conditions could dampen some optimism.

"We're cautiously optimistic recognizing margin for error is low in a tough macro backdrop," said J.P. Morgan's Tien-tsin Huang.

(Reporting by Niket Nishant in Bengaluru; Editing by Krishna Chandra Eluri and Shinjini Ganguli)

((Niket.Nishant@thomsonreuters.com;))