I recently accepted a Square offer and supposed to join in a few weeks. Have been reading a lot about potential recession. I know Square weathered the 2020 recession quite well despite small businesses being hurt. For those at Square and those that are good at reading quarterly reports, how much of a runway does Square have before they have to do layoffs, rescind offers, etc? #layoff #fintech #square #stripe Tc: 365k after stock decrease YOE: 8
Lol. The answer is decades for square LMFAO. Financial reports show ~4 BILLION cash on hand. It isn't some paper unicorn. Layoffs and hiring freeze have nothing to do with runway and everything to do with culture.
You know who used to have 7 BILLION cash on hand? and still has 6 BILLION right now? Coinbase. I mean Block is well positioned and will last way longer than Coinbase but just looking at cash on hand by itself doesn't mean much
So you agree with the post above? Layoffs have nothing to do with cash in hand...
Mate 2020 wasn’t a recession lol
Those who are saying 2020 wasn’t a recession, by definition, it was. 2 consecutive quarters of negative GDP growth. But it was understandable because of the Covid situation.
Global economy shock, probably a recession by definition overall but tech did not experience a downturn, quite the opposite for the sector.
Their financials dont look good and that's even disregarding a recession
What in their financials doesn't look good? Their profitability margin and cash in hand shows otherwise.
Not decades but they have strong recurring revenue and lots of cash on hand as well as net assets. I would think around 3 to 4 years assuming revenue suddenly dropped 80% but they may downsize long before they run out of runway and I definitely don't see that revenue drying up even in a recession
The goal of the fed is to remove excess liquidity from the market. If a company isn’t profitable, the fed would like people not to invest in it. So instead having people yolo money into these sectors, money should be allocated to organizations that is actually creating productivity which is a key element in managing inflation. So square and a handful of tech startups are likely fucked when they can secure cheap debt and venture funding. Everyone wants to cut cost to ride this out.
Square still needs to secure cheap debt?
Blah blah blah
Square can easily weather recession but the real problem is their stock price. It's P/E is very high and may drop quite a bit. So, factor in that while evaluating their offer. It has dropped a lot but it's P/E is still very high.
OP, watch Block's investor day 2022 to get a sense of how they are doing financially. I believe they are well diversified, are profitable (and profitability is increasing), haven't hired too many people (optimizing profitability along with growth), and have a healthy amount of cash on hand. These are positive signs, but anything is possible.
Lol watching a company’s own marketing event is NOT a good thing lol Talk about bias. The neat thing about public corporations is that all the financial info is disclosed. Just read their reports ffs.
The investor day had one full session on financial data and a q&a with the financial analysts. Read/listen/watch data, but analyse and make your own views.
Terminology is incorrect here. Square actually has infinite "runway" because it is a publicly traded company. "Runway" in my mind = "how much cash do you have to burn until need to raise a new round / liquidate." As Square/Block is a public company, if they ever needed more cash, they simply could sell more stock or raise more cash through debt markets. Not saying it would be an "efficient" way to fund the company, but they could do it, and they would find takers. However, as a pervious poster mentioned, they currently have about ~4B USD in cash and equivalents on hand, and although it has been a slim profit, the company has turned a profit for the past three years. Does this mean that they wouldn't be affected by a recession? No, it doesn't. Could there be layoffs? Of course. But this is true of any company in a recession and it's not like Square/Block is going to implode or lay off 50% of employees like some of the startups you've probably seen in the news recently, lol. In fact, I'd argue that companies like Square/PayPal... any company that makes their money off of transactions rather than the specific sale of goods is more recession proof than others, because customers still have to spend to live... they'll just be spending less. Taking a new job always comes with risks, but if the offer you've received is good/better than where you are now and you feel excited about working there, why not make the move? After all, in a recession, your current company could lay you off just as easily as your new company could 😉 p.s. Just be sure to manage your expectations about the stock price over the next 12-24 months.
Well yeah, I mean basically we're saying the same thing, just in different ways. My point is that publicly traded companies just don't "turn off the lights" like some pre-public companies do. But we're in agreement, not the right metric for the op to be measuring an offer on.
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Covid was quite bad for small businesses who use Square for payments. That took a long time to recover. Think about the food truck scene etc.
OP, that’s not what a recession is