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Square Stock History: A Complete Timeline
By: The Motley Fool | November 21, 2018

Square (NYSE:SQ) started off as a simple way for artisans and street vendors to accept credit cards, and now it's one of the biggest financial technology companies in the world. It's expanded from helping small businesses process credit cards to developing a whole host of services for merchants both large and small. It also offers consumer-facing services through Cash App (formerly Square Cash), including offering a deposit account and bitcoin trading.

Square's business is constantly changing as it expands its ecosystem of services. Taking a look at the history of the company and its stock can be enlightening for investors...

2018 and the future
Square continued its strong growth in 2018. Adjusted revenue continued its acceleration through the first two quarters of the year, reaching 60% year-over-year growth in the second quarter. Despite beating Wall Street analysts' expectations and her own guidance for revenue growth, Friar isn't increasing the company's guidance for EBITDA. Despite the announcement that Sarah Friar would be departing Square soon, she did note that she'd rather produce an absolute amount of earnings than focus on margins in order to show investors earnings growth.

Friar and Jack Dorsey outlined three main areas of focus at the beginning of the year: expanding Square's omnichannel offerings, offering more financial services, and increasing the company's presence in its international markets.

Square continues to make progress on all three fronts.

Omnichannel services such as appointments and Caviar have grown quickly. Revenue from the food-delivery business doubled in the second quarter. Square acquired Weebly earlier this year, which helps people create an online presence. The website creation tool will enable a more cohesive approach to omnichannel, and Weebly's established international user base could give Square a foot in the door with merchants in new markets.

The company continues to work on its financial services, particularly on the consumer side. It's steadily pushed the Cash Card into more consumers' wallets, and users are spending at a $3 billion annual run rate as of the end of June. The company called out the interchange fees it collects from Cash Card usage as a key driver of its subscription and services revenue during its second-quarter earnings call. Additionally, Cash App users in New York gained access to bitcoin trading after Square acquired a virtual currency license from the state's Department of Financial Services in June.

Internationally, Square is making good progress. It finally came to an agreement with Interac in Canada to accept debit payments. The company has been working to inform existing and potential merchants about the new agreement. Square says Interac accounts for about half of card payments in Canada. Meanwhile, it's attacking the U.K. town by town, moving cash-only stores to accept card payments. The investment in marketing has proven successful, and it's even more important now that PayPal has moved into the market with its acquisition of iZettle.



The strong growth of Square's revenue while showing strong absolute growth in EBTIDA led Square shares to climb another 150% in the first nine months of 2018.

The company is showing strong momentum in all three areas of focus for the year, and its ability to invest its excess cash and produce stable earnings is impressive. A lot of that is owed to Friar's ability to manage the company's growth and investments. Unfortunately, Friar is moving on to become the CEO of social network Nextdoor, leaving Dorsey and company to find a suitable replacement. She's staying on board until a replacement is found.

Square is creating vertical-specific software for merchants just as it has done for retailers and restaurants. It's also exploring a potential advertising product linked to its Cash Card loyalty program, Boosts. The Cash Card could also be used to offer consumer loans using data in a similar manner as Square Capital's business loans. As Square expands its ecosystem of services, its products become both more attractive and stickier, which should enable it to keep producing strong growth on both the top line and its earnings.

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