Square (SQ) reported earnings on Wed 22 Feb 2017 (a/h)

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The San Francisco-based company, which is run by Twitter Inc Chief Executive Jack Dorsey, posted a quarterly loss of 4 cents per share on revenue of $452 million.

Square beats by $0.04, beats on revs; guides Q1 EPS above consensus, revs in-line; guides FY17 EPS above consensus, revs in-line :

• Reports Q4 (Dec) loss of $0.05 per share, $0.04 better than the Capital IQ Consensus of ($0.09); revenues rose 42.7% year/year to $191.9 mln vs the $187.35 mln Capital IQ Consensus.
  • Gross Payment Volume (:GPV) for the fourth quarter was $13.7 billion, up 34% year over year.
• Co issues guidance for Q1, sees EPS of $0.00-0.02 vs. ($0.10) Capital IQ Consensus Estimate; sees Q1 revs of $190-193 vs. $191.57 mln Capital IQ Consensus Estimate.
• Co issues guidance for FY17, sees EPS of ($0.24)-($0.20) vs. ($0.29) Capital IQ Consensus Estimate; sees FY17 revs of $880-900 mln vs. $893.66 mln Capital IQ Consensus Estimate.
• "Our 2017 guidance reflects plans to continue investing in scaling our business, balanced by our ongoing commitment to margin expansion. As a reminder, our business is subject to certain seasonal trends. Historically, the first quarter is our slowest in terms of sequential growth of transactionbased revenue."
• "Additionally, we do not expect to see Starbucks transaction-based revenue going forward, which will have a negative impact on year-over-year growth in total net revenue in 2017. Lastly, hardware revenue in the first quarter of 2016 was elevated due to the fulfillment of the majority of pre-orders for our contactless and chip reader during the period. As a result, year-over-year hardware revenue growth for the first quarter and full year of 2017 will be more moderate relative to prior periods."
• "Sustained GPV growth is a result of our ability to efficiently add new sellers to Square and provide them with the tools they need to grow. We saw strong growth across our products, with revenue growth driven by both transaction-based and subscription and services-based monetization efforts. We maintained a payback period of 4 to 5 quarters for our seller acquisition costs and a positive dollar-based retention rate, which together underscore our ability to grow this revenue profitably. Additionally, we increased operating efficiency and continued to make improvements in transaction losses. We are carrying this momentum into 2017 by thoughtfully balancing margin expansion and our investments in growth."