Payments firm Square Inc has beaten Wall Street expectations for quarterly profit, as surging demand for bitcoin fuelled a jump in cryptocurrency transactions on its peer-to-peer payment service Cash App.
Stripping out one-time costs, the payments firm, led by Twitter CEO Jack Dorsey, earned 41 cents per share. Analysts on average had expected 16 cents per share, according to Refinitiv IBES data.
Cash App generated $3.51 billion in bitcoin revenue, up eleven times from a year earlier, in a quarter when the most popular cryptocurrency hit $1 trillion in market capitalization for the first time.
Dorsey told analysts on a post-earnings call that the company views bitcoin as “the internet’s potential to have a native currency.”
“This is going to be a long-term focus, enabling bitcoin to be a native currency. It removes a bunch of friction for our business, and we believe fully that it creates more opportunities for economic empowerment around the world,” he said.
Bitcoin has surged in value this year as the backing of top-tier companies including Tesla power its march to the mainstream.
San Francisco-based Square said in February it had invested $170 million in bitcoin, raising its wager from the $50 million it had invested in the fourth quarter of 2020.
The company’s top line was also strengthened by the shift to digital transactions, spurred by the COVID-19 pandemic that forced people to stay at home and shop online.
Gross payment volumes, a measure of the transactions processed on Square’s platform, rose 29% in the first quarter to $33.1 billion.
Total net revenue jumped nearly four-fold to $5.06 billion.
The team at Platform Executive hope you have enjoyed this news article. Automatic translation from English to a growing list of languages via Google AI Cloud Translation. Initial reporting via our official content partners at Thomson Reuters. Reporting by Noor Zainab Hussain and Niket Nishant in Bengaluru. Editing by Sriraj Kalluvila and Aditya Soni.
You can stay on top of all the latest developments across the platform economy, find solutions to your key challenges and gain access to our problem-solving toolkit, proprietary databases and content sets by becoming a premium member of our growing community. For a limited time, subscription plans start from just $16 per month.