Home / Technology / If Jack Dorsey Has a Problem Child Among His 2 Companies, It Isn’t Square

If Jack Dorsey Has a Problem Child Among His 2 Companies, It Isn’t Square


Jack Dorsey, chief executive of Square. Credit Yana Paskova/Bloomberg News

Square, the mobile payments company, reported a wider loss than it had a year ago and posted a 49 percent revenue increase on Wednesday, in its first earnings report as a public company.

The company, based in San Francisco, reported a loss of $ 80.5 million, or 34 cents a share, for the fourth quarter, compared with a loss of $ 37.1 million, or 25 cents a share, a year earlier. Sales totaled $ 374 million.

Excluding a payments processing agreement with Starbucks, which is winding down this year, Square reported adjusted revenue of $ 135 million. Square also said it processed $ 10.2 billion in gross payment volume, up 47 percent from a year ago.

“We are off to a great start with fourth-quarter results that demonstrate both high growth and strong operating performance,” the company said in a statement.

Square’s earnings report is being closely watched as a barometer for how its chief executive, Jack Dorsey, is performing. Mr. Dorsey is also chief executive of Twitter, and investors have questioned whether he can juggle both companies at the same time. Twitter is grappling with growth problems, trying to attract more people to its service.

The earnings are also being scrutinized for the greeting that other technology companies might receive if they go public. Square’s initial public offering in November on the New York Stock Exchange came in a tumultuous climate for tech offerings. Etsy, the online marketplace, now trades at around $ 8, a little more than half its offering price last April. Other companies recently taken public, like Box, are also trading well below their stock prices a year ago.

While Square has spent heavily to expand its business over the past few years, investor attitudes are growing more conservative when it comes to the bottom line.

“If you look over the past few years at a lot of recent tech I.P.O.s, there was an almost myopic focus on growth,” said Josh Beck, a research analyst for Pacific Crest Securities. “We’ve seen a correction and a different focus in the last year. Now everyone is really looking for a path to profitability.”

Shares of Square rose after the company announced its earnings. The company went public at $ 9 a share.

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