Earnings Results: Square tops $28 billion in payment volume as contribution from larger sellers grows

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Square Inc. delivered better-than-expected results Wednesday though its profit forecast fell short of expectations.

Shares were up 0.9% in after-hours trading.

The company posted third-quarter net income of $29 million, or 6 cents a share, after recording net income of $20 million, or 4 cents a share, in the year-prior quarter. Adjusted earnings per share climbed to 25 cents from 13 cents, whereas analysts surveyed by FactSet were modeling 20 cents.

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Square SQ, +0.46%  posted total revenue of $1.27 billion for the quarter, or $602 million after subtracting transaction-based costs and bitcoin costs. Excluding those costs, the company generated $431 million in revenue a year ago, and analysts were expecting $597 million for this latest quarter.

Square said that total net revenue for its Cash App was $307 million in the quarter, while gross profit for the app was $123 million. Excluding bitcoin, revenue was $159 million and gross profit was $121 million.

Gross payment volume increased to $28.2 billion from $22.5 billion and came just above the FactSet consensus, which called for $27.9 billion. Square disclosed that 55% of volume came from sellers doing more than $125,000 in annualized gross payment volume. These sellers accounted for 54% of volume in the June quarter.

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For the December quarter, Square projects 19 cents to 21 cents in adjusted EPS. The FactSet consensus was for 25 cents.

Square shares have risen 9.3% so far this year, while the S&P 500 SPX, +0.07%  has climbed 23%.