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This statistic highlights Square’s Revenue by Segment from Q1 2016 onwards split between Bitcoin, Hardware, Subscription and services-based, and Transaction-based, on a quarterly basis.
Square, Inc. develops solutions that enable businesses, sellers, and individuals to participate in the economy. They realized that sellers require a variety of solutions to survive and saw how they could use their strengths in technology and creativity to assist sellers.
Square’s revenue is divided among the following reportable segments:
|Segment||Revenue in Q1 2020||Revenue in Q4 2020||Revenue in Q1 2021||Revenue Share in Q1 2021|
|Subscription and services-based||$296||$449||$558||11.0%|
(All figures in millions, except percentages)
Square’s total revenue increased from $1381 million in Q1 2020 to $5057 million in Q1 2021, marking a 266% increase on a year-on-year basis. It also grew by 60% compared to $3158 million in Q4 2020.
Square’s Cash App customers have the facility to purchase bitcoin. Square buys bitcoin from private brokers or Cash App users and applies a slight margin before selling it to their consumers. As the principal in the bitcoin selling transaction, the sale amounts received from consumers are recorded as revenue on a gross basis and the corresponding bitcoin cost as the cost of revenues.
The majority of Square’s revenue is generated through Bitcoin accounting for 69.4% of total revenue in Q1 2021, amounting to $3511 million. This was a huge 1074% rise from $306 million gained in Q1 2020 a year ago. The increase was attributable to the rise in bitcoin’s market price, an increase in the number of active bitcoin consumers, and an increase in volume per customer.
Hardware revenue consists of sales of contactless and chip readers, Square Stand, Square Register, Square Terminal, and third-party peripherals Cash drawers, receipt printers, and barcode scanners are examples of third-party peripherals that can be linked with Square Stand, Square Register, or Square Terminal to give a complete point-of-sale system.
Square’s revenue from hardware increased from $21 million in Q1 2020 to $ 29 million in Q1 2021, up by 39% on a year-on-year basis. The rise was mostly due to increased hardware sales in the international markets, as well as contactless hardware sales as a result of particular discounts made in Q2 and Q3 2020. Hardware contributed only 0.6% to Square’s revenue in Q1 2021.
Subscription and services-based
The majority of Square’s subscription and services-based revenue comes from Cash App, Square Capital, and Instant Transfers for sellers. Cash App subscription and service revenue is mostly made up of transaction fees from Cash App Instant Deposit and Cash Card. Website hosting and domain name registration services, Gift Cards, Square Appointments, Customer Engagement, Employee Management, Payroll, Square Card, and other product offerings are among the other subscription and service-based products.
In Q1 2021, Square’s Subscription and services-based revenue amounted to $558 million. It grew by 88% from $296 million earned in Q1 2020. Cash App, and to a lesser extent Square Card and Instant Transfers for sellers, fuelled the growth, which was somewhat offset by a decline in Square Capital loan volumes. Square’s subscription and services-based revenue accounted for 11% of the company’s total revenue in Q1 2021.
Square charges its vendors a transaction fee, which is often determined as a percentage of the overall transaction value. Transaction-based revenue also includes fees charged to Cash App consumers for peer-to-peer transactions to business accounts and credit card payments.
Square’s Transaction-based revenue grew by 27% from $758 million in Q1 2020 to $960 million in Q1 2021. The increase was mostly driven by an increase in higher-priced card-not-present purchases as sellers restructured their activities in response to the COVID-19 outbreak. Square’s transaction-based revenue contributed to 19% of the company’s total revenue in Q1 2021.
About Square, Inc.
Square, Inc. is a financial services and digital payments firm founded in 2009 by Jack Dorsey and Jim McKelvey, with its initial platform launched in 2010. It is headquartered in San Francisco, California. It is traded on the New York Stock Exchange since November 2015 under the ticker symbol “SQ”. Square has offices in the United States, Canada, Japan, Australia, Ireland, and the United Kingdom. They offer more than 30 various products and services to sellers to assist them in managing and growing their businesses. Intuit QuickBooks GoPayment, PayPal Here, ShopKeep, Clover, and Shopify are some of Square’s major competitors worldwide.
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