Fintech company Square (NYSE:SQ) reported blowout first-quarter results amid explosive growth in digital financial transactions.
Square shares were up in premarket trading after the company reported that its revenue soared almost four times in the quarter to $5.057 billion U.S. from $1.381 billion U.S. in the first quarter of 2020. Analysts had expected first-quarter revenue of $3.34 billion U.S.
Square’s quarterly profit totaled $39 million U.S., or eight cents U.S. a share, in the first quarter, swinging from a loss of $105.89 million U.S., or 24 cents U.S., a year ago. Analysts had called for a loss of 10 cents U.S. in the first quarter.
Square shares were up about 2% at $228.65 U.S. in premarket trading on the financial results. The stock has gained 28% in the last six months, but has slid 16% in the past month amid valuation concerns.
"We delivered strong growth at scale during the first quarter of 2021," the company said in a written statement. "Gross profit grew 79% year-over-year to $964 million U.S.… In our seller ecosystem, gross profit was up 32% year-over-year in the first quarter. Our Cash App ecosystem delivered gross profit growth of 171%."
On March 31, Square stock was upgraded at Keefe, Bruyette & Woods to "outperform" from "market perform." The stock has 17% potential upside from KBW’s $250 U.S. price target.
