With $546 million coming from Cash App’s Bitcoin services, Jack Dorsey’s Square made more than 90% higher gross profit than the same period last year.
For the second quarter of 2018, Square announced a doubling of Bitcoin revenue compared to the same period last year (YoY).
A shareholder letter sent out by the corporation on August 1 highlighted the company’s record earnings in the second quarter. According to the study, Square’s total gross profit increased by 91 percent year on year to $1.14 billion in the first quarter of 2018.
With Bitcoin services, the app generated $2.72 billion in revenue, with a gross profit of $55 million. These figures represent year-on-year growth of 210 percent and 223 percent, respectively, for the company. The total gross profit was $546 million, representing an increase of 94 percent year on year.
“Bitcoin revenue and gross profit benefited from year-over-year increases in the price of bitcoin and bitcoin activities, and growth in customer demand.”
Although Bitcoin sales and gross profit declined as compared to the first quarter of this year, it is still up 22.3 percent year over year from 3.5 billion.
This, according to Square, is due to the more than 50 percent pullback experienced by the broader cryptocurrency markets over the months of May and June.
Square also announced a $45 million loss on the value of the Bitcoin it currently has in its possessions.
Due to the fact that Tesla treats Bitcoin (BTC) as an “intangible asset,” accounting standards require the company to record an impairment loss when the asset’s value falls below the amount originally paid for it.
The company is likewise exempt from disclosing gains in the value of its intangible asset holdings until the position is realised through the sale of the assets.
The Bitcoin Treasuries website reports that Square now has 8 027 BTC worth around $320 million at the time of this writing.
This acquisition, which comes on top of Square’s initial purchase of 4,709 BTC in October 2020, brought the total amount of BTC purchased by Square to 3,318 BTC in February for $170 million.
A storey published on July 30 by Cointelegraph stated that mobile software company MicroStrategy had committed to buy more Bitcoin despite suffering an impairment loss of $425 million on its Bitcoin holdings in Q2. For the quarter, Tesla reported a $32 million impairment loss on its assets.