Square-parent Block (SQ) reported December-quarter earnings, net revenue and gross payment volume that topped analyst estimates, despite growth slowing for consumer Cash App services. SQ stock jumped in extended trading amid updated guidance amid the acquisition of Afterpay.
San Francisco-based Block reported fourth-quarter earnings late Thursday. SQ stock initially fell on the earnings release. But after the earnings call with Wall Street analysts, Square stock jumped 21% to near 155 in extended trading on the stock market today.
Square earnings came in at 27 cents per adjusted share, down 15% from 32 cents in the year-earlier period. Analysts had projected earnings of 23 cents a share.
Gross profit increased 47% to $1.18 billion vs. estimates of $1.16 billion, the company said.
Square said net revenue jumped 62% to $4.42 billion, boosted by Cash App transactions for digital cryptocurrency Bitcoin. Analysts had predicted revenue of $4.04 billion.
Gross payment volume from merchant customers rose 92% to $46.3 billion, in line with estimates. But gross payment volume growth is expected to slow in the March quarter.
Square said earnings before interest, taxes, depreciation and amortization, known as EBITDA, came in at $184 million vs. estimates of $143 million.
Square on Jan. 31 closed the acquisition of Australia-based consumer lending startup Afterpay. Announced on Aug. 1, the deal was originally valued at $29 billion. With the big drop in Block stock, the deal was valued at less than $15 billion at closing.
Afterpay competes in the emerging “buy now, pay later” market that encroaches on credit card networks.
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