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Square's first quarter adjusted earnings exceeded analysts' estimates, while the company's June forecast was below Wall Street's targets. Square's results sent shares of the digital payment processor to collapse on Wednesday night.
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Square (QS), said adjusted earnings, excluding a loss of investment in Eventbrite (EB), were 11 cents per share.
Adjusted revenues increased 59% to $ 489 million, which dominated the outlook. A year earlier, Square's earnings were 6 cents a share on adjusted sales of $ 307 million.
Analysts forecast Square Square net income of 8 cents on adjusted sales of $ 478.3 million for the period ended March 31.
"The continued deceleration in gross payout volume (GPV) of large sellers from 41% in the third quarter to 39% in the third quarter and 37% in the first quarter merits further investigation," said Dan Dolev, an analyst at Instinet- Nomura.
The Square stock fell from 6.3% to 69% after normal market hours.
Square orientation lack of consensus estimates
For the June quarter, Square forecast adjusted earnings of 15 cents midway through its forecast, compared with an estimate of 19 cents. Square said it expects an adjusted business figure of $ 550 million mid-term. Analysts had an adjusted income estimated at $ 555.5 million.
San Francisco-based Square credit card readers connect to mobile phones and tablets.
Square invests in new products and services. Square also made some acquisitions in 2018. Much of its growth comes from Square Capital, which offers small business loans and cash advances.
The company said adjusted EBITDA – earnings before interest, taxes, depreciation and amortization – rose 72 percent to $ 62 million. This exceeded estimates by $ 51 million.
However, Square said it expects an adjusted EBITDA of $ 92 million for the June quarter, against estimates of $ 102 million for analysts.
In addition, the company provides software for point-of-sale systems and administrative services to manage inventory and other tasks. It also offers a customer relationship management software.
Follow Reinhardt Krause on Twitter @reinhardtk_tech.
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