Why Square Is Surviving Thursday’s Market Carnage
Square stock rallied Thursday after the release of better than expected fourth-quarter financial results late Wednesday.
When Square Inc. (NYSE: SQ) released fourth-quarter financial results after markets closed Wednesday, the mobile payment company said that it had $0.23 in earnings per share (EPS) and $1.31 billion in revenue. The consensus estimates had called $0.21 in EPS and $1.186 billion in revenue, and the same period of last year reportedly had EPS of $0.14 on $933 million in revenue.
During the most recent quarter, gross payment volume (GPV) increased 25% year over year to $28.6 billion. The GPV from larger sellers grew 33% year over year and accounted for 55% of total GPV, up from 51% in the fourth quarter of 2018.
Transaction-based revenue was $832 million, up 25% year over year, and transaction-based profit was $313 million, up 27%.
Subscription and services-based revenue totaled $281 million in the fourth quarter, up 45% year over year. Also, subscription and services-based gross profit came to $231 million, up 63% in the same period. Hardware revenue was $22 million, up 23% year over year, and hardware generated a gross loss of $18 million.
Looking ahead to the first quarter, the company expects to see EPS in the range of $0.16 to $0.18 and revenue between $1.34 billion and $1.36 billion. Consensus estimates call for $0.16 in EPS and $610.26 million in revenue for the quarter.
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Square stock traded up about 6% at $81.06 Thursday morning, in a 52-week range of $54.41 to $87.25. The consensus price target is $76.22.
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Chris Lange is a financial and geopolitical writer with more than a decade of experience covering a myriad of topics. He has published thousands of articles for 24/7 Wall St., with past coverage focused heavily on stocks, IPOs, healthcare, defense, global affairs, and technology.
His work has been quoted, or referenced by a number of outlets including Business Insider, USA Today, Yahoo Finance, MSN, The Motley Fool, and many other publications. A graduate of Southwestern University, he studied business with a focus on investments and has previous experience in banking and startups.
When not reading or writing the news, he is following his passion for Lacrosse, playing chess, or building solar projects with his dad.
