Square topped analysts’ Q4 earnings and revenue estimates and announced the purchase of roughly 3,318 additional bitcoin.
Shares of Square Inc. (SQ) – Get Report were falling after hours Tuesday after the digital payments company reported fourth-quarter earnings and revenue ahead of expectations and also announced a new purchase of bitcoin.
The San Francisco company reported fourth-quarter adjusted earnings of 32 cents per share on total net revenue of $3.16 billion, a 141% year-over-year increase. Excluding bitcoin revenue, total quarterly net revenue was $1.4 billion.
Analysts were expecting adjusted earnings of 24 cents per shares on revenue of $3.1 billion, according to FactSet.
The company also announced that it has purchased about 3,318 bitcoins at an aggregate purchase price of $170 million. Combined with its previous purchase of $50 million in bitcoin, the cryptocurrency now represents about 5% of Square’s total cash holdings as of the end of 2020.
“The investment is part of Square’s ongoing commitment to bitcoin, and the company plans to assess its aggregate investment in bitcoin relative to its other investments on an ongoing basis,” Square said.
The company reported a fourth-quarter gross profit of $804 million, up 52% year-over -year. The company’s Cash App service had more than 36 million monthly transacting active customers in the quarter, a 50% year-over-year increase.
The price of bitcoin tumbled Tuesday after Tesla (TSLA) – Get Report CEO Elon Musk implied in a tweet over the weekend that the price of bitcoin, which Tesla now holds on its balance sheet, was extended.
Last week, Tesla disclosed in a regulatory filing that it had made a $1.5 billion investment in bitcoin earlier this month.
Bitcoin was trading at $48,096 at last check Tuesday afternoon, down 11%.
Shares of Square were falling 5.6% to $242.75 after hours on Tuesday, after dropping 4.3% during the day.
Originally published at https://www.thestreet.com/investing/square-drops-despite-quarterly-beats-buys-more-bitcoin on .