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Square reported a net revenue excluding that from Bitcoin of $1.96 billion during the second quarter.
Square Inc (NYSE: SQ) stock closed Monday trading at $272.38, 10.16% higher than the opening price. The spike was attributed to news that Square has purchased Sydney-based financial technology company Afterpay Limited (ASX: APT) for a whopping $29 billion.
Consequently, Afterpay shares closed yesterday trading at $128.22, up 11.69%.
“Square and Afterpay have a shared purpose,” said Square’s CEO Dorsey in a statement.
In an interview with journalists, Square CFO Amrita Ahuja said that the acquisition is strategic by all means and will help the company penetrate a trillion-dollar market. “Buy now, pay later is an incredibly attractive space going after a $10 trillion online payments industry where we’re about 2% penetrated today,” Ahuja noted.
According to Square through a press release, the deal will be facilitated through stocks in full. The acquisition is expected to help both companies penetrate global markets at ease. Mind you, they are now backed by able advisors including Morgan Stanley & Co. LLC.
Square (SQ) Market Outlook
From another perspective, Square (SQ) stock experienced a boost from the second-quarter earnings results announced the same day. Notably, Square reported a net revenue excluding that from Bitcoin of $1.96 billion during the second quarter. Additionally, the company saw its gross profit rose by 91% year over year during the second quarter. Notably, the fintech company saw its Bitcoin revenue come in at $2.72 billion during the last three months of the first half of 2021.
Previously, the company had said that it has halted its Bitcoin purchases after sustaining losses in millions. However, Jack Dorsey has remained a strong supporter of Bitcoin and blockchain technology.
Mind you, Dorsey announced that the company is developing a Bitcoin hardware wallet. Additionally, the company is focused on building a Bitcoin-focused company dubbed TBD. Led by Mike Brock, TBD will solely focus on Bitcoin and its infrastructure.
Notably, Dorsey has significantly shifted his focus from the social media platform Twitter to building a strong infrastructure for Bitcoin.
As of reporting time, Square had a reported market capitalization of approximately $112.59 billion with 392 million outstanding shares. According to market analytics provided by MarketWatch, SQ shares are up approximately 102%, 25%, and 11% in the past year, seven months, and three months respectively through Monday. A survey conducted by the same media noted that 43 analysts gave SQ stocks an average of Over rating.