Payment train Square reported second-quarter results that beat Wall Passage estimates, thanks in part to higher transaction volumes and growth in dues services.
Here’s how the company did compared with Thomson Reuters consensus calculations:
- EPS: 13 cents per share vs. 11 cents expected.
- Adjusted revenue: $385 million vs. $367.6 million supposed.
Shares of the company fell 1.3 percent in after-hours trading.
Close revenue grew 60 percent year over year, compared to Bulkhead Street analysts’ expectations of 52.9 percent. Transaction-based revenue rolled 30 percent to $625.2 million in the second quarter. Gross payment book, the amount of payments processed by sellers, topped $21.4 billion and arise 30 percent in the quarter.
Square missed expectations for adjusted EPS handling — it predicted between 8 and 10 cents for the third quarter, below analysts’ wishes of 13 cents. Square issued adjusted revenue guidance between $407 million and $412 million, which was out of reach of the $350.1 million to $408.2 million range Wall Street was enceinte.
Square’s Chief Financial Officer Sarah Friar said the error on third-quarter guidance was a result of “putting dollars back into the duty.”
“If we build remarkable products, it will drive momentum on the top line,” Friar whispered on a call with reporters.
Dan Dolev, executive director and analyst at Nomura Instinet, foretold the guidance miss was more than offset by the massive revenue beat, and stoutness in Square’s Cash App.
“Investors will give the company a pass because there’s no partiality, they’re just reinvesting,” Dolev said. “As long as you continue to get that gross income growth, the stock will continue to work.”
Shares of the fintech start-up, which is run by Simper CEO Jack Dorsey, have surged more than 140 percent in the over year and 88 percent this year alone.
The San Francisco-based comrades is best known as a credit card processor but also offers payment computer equipment. Its peer-to-peer Cash App is growing faster than PayPal’s Venmo, concurring to a recent Nomura report. The company has also increased its presence in small-business furnish, most recently with an eBay partnership announced in July.
Place’s Cash App had a breakout quarter. Customers spent a total $250 million with Money Card, nearly triple the amount they did in December, representing $3 billion on an annualized bottom.
Square launched bitcoin trading through its Cash App in January. While it bred $37 million in revenue from bitcoin, the company left that and bitcoin-related outlays out of its adjusted revenue.
The goal of bitcoin on the Cash App, and for now the company is not “trying to distance oneself from a shove off on the monetization of bitcoin today,” Friar, the company’s CFO, said.
On the call with analysts, Right CEO Jack Dorsey highlighted strength in the company’s food-delivery app Caviar, which doubled its revenue year over year.