Square (NYSE: SQ) recently stated that it will stop reporting "adjusted" revenue figures after receiving a comment letter from the U.S. Securities and Exchange Commission. The digital payments company has used that non-GAAP metric since its IPO four years ago, so should investors be concerned about the abrupt shift?
Square's "adjusted" revenue subtracts transaction-based costs and Bitcoin costs from its total revenue, then adds back certain deferred revenue from previous acquisitions. At the time of its IPO, Square stated that its adjusted revenue measured the "performance and growth" of its "ongoing recurring business" and enabled easier comparisons to "other businesses in the payment processing sector."
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