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Square Inc. is raking in profits thanks to the popularity of its mobile payment service. The firm’s Cash App Bitcoin (BTC) revenue for the second quarter rose by 600 percent compared to last year’s figure resulting in a corresponding meteoric rise in its gross profits.
On Tuesday, Square Inc. released its Q2 2020 performance revealing that its Bitcoin revenue has dramatically increased by 600 percent, Bitcoin.com reported. The firm managed to rake in $875 million in revue for the second quarter this year, which resulted in a jump of 711 percent of its Bitcoin gross profit for the same period. Compared to the second quarter result last year, Cash App’s gross profit rose by 167 percent and reached$281 million.
“Cash App generated $875 million of bitcoin revenue and $17 million of bitcoin gross profit during the second quarter of 2020, up 600% and 711% year over year, respectively,” Square wrote in the report.
Square’s s net Q2 2020 revenue, which includes Bitcoin revenue, increased by 64 percent year over year and reached $1.92 billion. Meanwhile, the firm’s gross profit rose to $597 million, up by 28 percent compared to last year’s figure.
“Customers increasingly used Cash App as a way to send and spend money,” Square’s report explained. “In June, Cash App had more than 30 million monthly transacting active customers, with more than 7 million spending on Cash Card,” The company added that “Bitcoin revenue and gross profit benefited from an increase in bitcoin actives and growth in customer demand.”
Square added that Cash App’s performance was boosted by the stimulus payments and unemployment benefits under the Coronavirus Aid, Relief, and Economic Security Act (CARES Act), which was signed into law by President Donald Trump in March. “We believe this uplift was partly driven by government stimulus programs,” the company wrote. The company noted that some of its customers “direct deposited these payments into their Cash App accounts.”
Meanwhile, Fool.com noted that there are three key factors that drove Cash App’s profits up. These are accelerating customer acquisition, improved product adoption, and increased frequency and volume. The publication wrote that Square added 6 million net new active Cash App accounts in the first six months of 2020.
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