Square plans to buy Afterpay as it plans to develop further into the booming installment loan market. Jack Dorsey’s payments company announced the $29 billion, all-stock deal on Sunday evening. The price tag marks a roughly 30% premium to Afterpay last closing price.
Square CEO Dorsey said that the square and Afterpay have a shared purpose. They are planning to build our business to make the financial system more fair, accessible, and inclusive, and the Australian fintech company has built a trusted brand aligned with those principles. Shares of Afterpay in Australia surged on that news and closed nearly 19% higher on Monday.
Square also announced its second-quarter results on Sunday, ahead of the previously planned release on Wednesday. Gross profit increased 91% from a year ago, which marked a record quarterly growth rate for the payments company. Cash App profit was up 94%, while sellers jumped 85% from a year ago. Net revenue excluding bitcoin came in at $1.96 billion for the quarter, an 87% rise year over year. The company’s Venmo competitor, Cash App now has 40 million monthly transacting active customers.