Feb 23, 2021
Square reports quarterly revenue that falls short of estimates
Bloomberg News
,Cole Kachur discusses Square
Square Inc. reported quarterly sales that missed estimates, with its business primarily driven by demand for Bitcoin transactions within the company’s Cash App. Shares declined about 4 per cent in extended trading.
The San Francisco-based payments company also announced it purchased roughly US$170 million worth of Bitcoin, and the cryptocurrency now accounts for about 5 per cent of total cash, cash equivalents and marketable securities. Chief Executive Officer Jack Dorsey is a vigorous advocate of cryptocurrency.
Revenue more than doubled to US$3.16 billion in the period ending Dec. 31, falling short of the US$3.22 billion average of analysts’ estimates, according to data compiled by Bloomberg.
Square said its peer-to-peer payments app, Cash App, which lets people buy stocks, store money and send money to friends, increased monthly users 50 per cent to 36 million in December from a year earlier. The company previously said usage of the app picked up in mid-2020 as people turned to it to accept government stimulus checks. Square also pointed to Cash App’s success as a main driver of the business in the third quarter, thanks in large part to Bitcoin-related transactions.
Profit, excluding some items, was 32 cents a share, compared with analysts’ estimates of 24 cents. Net income declined to US$294 million from US$391 million in the quarter a year earlier, the company said Tuesday in a statement. Gross Payment Volume, or the cost of goods and services processed by retailers using Square’s sales products, increased 12 per cent to was US$32 billion.