Square Review

Square Beats Analysts, Plans to Beat Them Harder

November 13, 2017         By: Steven Anderson

It’s been a great year so far for Square by literally any definition of the term; not only did it recently post third-quarter results that surpassed expectations, but it’s responded to this development by boosting its forecast for the full year as well in both revenue and profit.

New word from Jack Dorsey notes that Square’s full-year adjusted profit is now set to be $0.24 to $0.25 per share, with revenues somewhere in the $2.18 billion to $2.19 billion range. Previously, the per-share range was $0.21 to $0.23, and revenues were a significantly broader range of $2.14 billion to $2.16 billion. Gross payment volume is up 31 percent for the quarter, reaching $17.39 billion in all. Square even posted an adjusted profit for the quarter of $0.07 per share, where analysts expected $0.05

Driving this impressive new push, reports note, is the growing number of merchants—and the increasingly larger size of same—who are putting Square technology to work in processing payments. Sarah Friar, the company’s chief financial officer, noted that the company was increasingly “…mov(ing) upmarket”, and this led to improved returns.

Square’s recent release of the Square Register, which helps provide more useful services to larger-scale business operations, is only helping matters further. Indeed, for companies that process over half a million in annual transactions, 64 percent more of these are turning to Square.

It also helps that Square has been offering increasing ranges of financial services to users as well, including things like payment cards and even loans. This is a point that hasn’t sit well with local banks; just recently, we saw how such banks are looking to regulators to keep options limited on this front for Square and those like it. Such a move could indeed hurt local banks, who don’t have the kind of capital Square does, and a limited amount of room in which to innovate.

Still, for the short term, Square is doing very well, and delivering significant value for users and investors alike. Hopefully it can keep going on this front.