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Square Stock Falls As Earnings, Revenue Miss Amid Slowing Cash App Growth
By: Investor's Business Daily | November 4, 2021

Square stock fell Thursday as September-quarter earnings, net revenue and gross payment volume missed analyst estimates amid slowing growth for the consumer Cash App.

San Francisco-based Square (SQ) reported third-quarter earnings after the close. SQ stock slipped 3.4% to near 239 in extended trading on the stock market today.

Square earnings came in at 37 cents per adjusted share, up from 34 cents in the year-earlier period. That missed estimates for 38 cents.

Gross profit increased 43% to $1.13 billion vs. estimates of $1.15 billion, the company said.

"Consolidated gross profit missed by 2% on a largely-expected 5% miss in the Cash App," said Jefferies analyst Trevor Williams in a report.

Square said net revenue jumped 27% to $3.84 billion as more Cash App users bought and sold digital cryptocurrency Bitcoin. Analysts had predicted revenue of $4.39 billion. Excluding Bitcoin, revenue rose 45% to $2.03 billion.

Square Stock: Slowdown In Cash App Growth Expected
Square said gross payment volume, or GPV, from merchant customers rose 43% to $45.4 billion vs. estimates of $45.6 billion. The proposed acquisition of Afterpay has pressured SQ stock.

The digital payment processor has not provided 2021 financial guidance. Square stock surged in 2020 as investors focused on the growth of its consumer Cash App. They shrugged off worries over Square's exposure to small businesses and restaurants amid the coronavirus pandemic.

Heading into Square's earnings report, the stock traded 14% below an entry point of 289.33. Square stock holds a Relative Strength Rating of only 59 out of a best-possible 99, according to IBD Stock Checkup.

SQ stock has gained about 15% in 2021.

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