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Just days after reporting its latest results, the company is cutting more jobs in its Cash App division. This is the second time this year it has reduced its workforce as it moves away from the high-spending habits of its early years.
While layoffs are difficult for those involved, they show management is serious about making the business more efficient. By keeping costs low while the number of people using its apps continues to grow, the company can turn more of its revenue into actual profit.
Source: Business Insider
Barclays maintained its positive rating on the stock this week. Other firms including Wells Fargo and RBC Capital also kept their ratings steady, suggesting that professional researchers generally agree the business is on the right path after its latest update.
Source: Barclays
The company reported a strong third quarter, with earnings of $1.13 per share beating the $1.03 analysts expected. Revenue reached $6.72 billion, driven by growth in both the Square merchant business and the Cash App ecosystem. Most notably, adjusted earnings per share grew by 109 percent compared to the same time last year.
Management also announced a preliminary settlement with the Justice Department regarding past money-laundering investigations. This is a major step forward because it helps clear a legal cloud that has hung over the stock for months. With the business now focused on using AI to automate costs and connecting its two main platforms through a new loyalty program, it is successfully proving it can be highly profitable as it matures.
See the full quarter, and how our tracked metrics did
Source: 8-K filing
Management has shifted from a long streak of misses to three straight quarters of strong beats. This shows they have gained control over their costs and are now consistently outperforming their own forecasts.
| Expectation | |
|---|---|
| EPS | $1.16 |
| Revenue | $6.79B |