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Square (SQ) Rallies on Q1 Earnings Beat, GPV Increases 33%

Madeleine Johnson

Square Inc. SQ just released its first quarter fiscal 2017 financial results, posting earnings of a loss of 4 cents per share and revenues of $462 million. Currently, SQ is a #3 (Hold) on the Zacks Rank, and is up 5.3% to $19.25 per share in trading shortly after its earnings report was released.


Beat earnings estimates. The company posted earnings of a loss of 4 cents per share, topping the consensus estimate of a loss of 8 cents per share. Net income was a loss of $15 million for the quarter, up $82 million year-over-year.

Beat revenue estimates. The company saw total revenue figures of $462 million, beating our consensus estimate of $451 million and growing 22% year-over-year.

Square processed $13.6 billion of gross payment volume (GPV), representing an increase of 33% from the prior year period. The company continued to see strength from larger sellers, which are those that generate more than $125,000 in annualized GPV.

Adjusted EBITDA was $27 million in the first quarter of 2017, compared to a loss of $9 million in the first quarter of 2016, an improvement of $36 million on a year-over-year basis. First-quarter Adjusted EBITDA margin of 13% is an improvement of 19 percentage points year over year.

Looking ahead, Square expects total net revenues between $2.12 billion and $2.16 billion for fiscal 2017, with adjusted EBITDA between $110 million and $120 million. Net income (loss) per share is estimated in the range of $(0.24) and $(0.20), while adjusted EPS should fall between 16 cents and 60 cents per share.

Here’s a graph that looks at Square’s price, consensus, and EPS surprise:

Square, Inc. Price, Consensus and EPS Surprise

Square, Inc. Price, Consensus and EPS Surprise | Square, Inc. Quote

Square, Inc. offers financial services and marketing services. The Company provides payments and point-of-sale which include hardware and software to accept payments, streamline operations and analyze business information. Its payments and POS services include In-Person Payments, Online Payments, Square Cash, Square Register, Square Analytics, Square Appointments and Square App Marketplace. The Company's financial services include Square Capital and Square Payroll. Square, Inc. is headquartered in San Francisco, California.

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