On May 6, Square released its reports for the first quarter of 2020. The reports released Square’s cash app earnings, most of which came from Bitcoin.
The numbers for Q1 and the role of Bitcoin
Bitcoin generated $ 306 million of the $ 528 million cash app revenue for the first quarter of the year.
Despite these numbers Bitcoin accounted for a small portion of the cash app profit, just $ 7 million of the total profit of $ 183 million. The company explained why it separated Bitcoin’s revenue as a more important mission:
“We deduct Bitcoin revenue because our job is to make it easier for customers to access Bitcoin. When customers buy Bitcoin through the Cash app, we only apply a small margin to Bitcoin’s market costs, which tend to be volatile and are beyond our control. “
Changes throughout the year in the middle of COVID-19
Cash App saw a profit increase of 115% compared to the previous year. At an investor meeting on May 6, a Square team member attributed “efficient new customer acquisition”, which generally translates into good marketing and ease of use.
Source: Square Q1 report to SEC
Investor numbers were less optimistic: earnings before interest, taxes, depreciation and amortization decreased from $ 119 million in the fourth quarter to $ 9 million in the quarter.
At the same meeting with shareholders, executives, including Jack Dorsey, stressed Square’s performance in January and February, instead of March when the coronavirus pandemic began to devastate the markets.
Dorsey praised the company’s “agility” in the midst of this economic crisis. His colleague said: “We are encouraged by the performance of the Cash App in April.”