In a volatile week for many tech stocks as earnings season continued chugging along, three stories in tech were particularly interesting, including news from fintech company Square (NYSE:SQ), streaming-TV specialist Roku (NASDAQ:ROKU), and cloud-storage provider Dropbox (NASDAQ:DBX).

  1. An analyst warmed up to Square's improving business, giving the stock a buy rating.
  2. Roku stock jumped on better-than-expected second-quarter results.
  3. Dropbox reported earnings and said it's losing its chief operating offer.
A man using the Square Cash App

Square's Cash App. Image source: Square.

Square's buy rating

Shares of Square moved about 3.6% higher on Monday, after Buckingham Research Group analyst Chris Brendler upgraded Square stock from "neutral" to "buy," giving the stock a price target of $85.

Brendler's more optimistic view for the company reflects the broadening scope of Square's business, which in recent years has included the launch of a range of successful new products and services. Brendler is particularly optimistic about Square's expansion in consumer products with its Cash App ecosystem. "In our view, Cash App is just the beginning as we see growing potential for SQ in consumer lending, digital bank accounts, and cryptocurrency trading," said the Brendler (via Barron's).

Square has been on a roll recently, posting accelerating revenue growth for five consecutive quarters. The company's top line increased an impressive 48% year over year in Q2, or 60% on an adjusted basis.

Roku surges

Roku impressed investors with expectation-beating revenue and earnings per share, as well as robust revenue guidance. The solid second-quarter sent shares surging, ending the week up about 25%.

Roku's total revenue increased 57% year over year to $156.8 million, driven by a 96% jump in platform revenue and 24% higher player revenue. Roku said advertising revenue was the largest driver of its standout growth in platform revenue. "As TV advertising continues to move to streaming, we believe we can deliver rapid platform growth over a sustained period," Roku said in its second-quarter shareholder letter. 

Roku's net income per share came in at breakeven, up significantly from a loss per share of $3.18 in the year-ago quarter.

The results easily beat consensus forecasts for revenue of $141 million and a loss per share of $0.15.

Dropbox's executive transition

Cloud-storage company Dropbox announced better-than-expected revenue, earnings, and guidance this week.

Revenue increased 27% year over year to $339.2 million, ahead of a consensus analyst estimate for revenue of $330.9 million. Adjusted earnings per share was $0.11, above a consensus forecast for $0.06. 

Dropbox's strong growth benefited from a 20% year-over-year increase in paying users and 4.9% growth in average revenue per paying user.

But just as important to its earnings release was the news that the company's chief operating officer, Dennis Woodside, is stepping down. Dropbox said Woodside's last day at Dropbox will be on Sept. 4. "It's hard to overstate Dennis' impact on Dropbox," said Dropbox CEO Drew Houston during the company's second-quarter earnings call. "When he started, we had a couple hundred million in revenue and our company was a fraction of the size."

Dropbox said it's filling Woodside's responsibilities with the promotion of two of his senior leaders. Yamini Rangan will become chief customer offer and Lin-Hua Wu will become vice president of communications. Both executives will report directly to Houston.

Daniel Sparks owns shares of Square. The Motley Fool owns shares of and recommends Square. The Motley Fool has the following options: short September 2018 $80 calls on Square. The Motley Fool has a disclosure policy.