Three fast-growing companies report earnings over the next two days. Digital payment company Square (NYSE:SQ) and streaming-TV platform specialist Roku (NASDAQ:ROKU) are set to report their latest results after market close today. The Trade Desk (NASDAQ:TTD) -- the world's leading programmatic digital ad-buying platform -- will report its earnings on Thursday.
All of these companies are benefiting from uncanny top-line growth, making their upcoming earnings reports particularly interesting. Can these growth stocks impress investors with more strong execution?
Ahead of their earnings releases, here's a quick overview of some of the key metrics investors will want to check on.
Square earnings: Large sellers are key
While Square's third-quarter revenue growth will be important to watch later today, another key metric to check on will be the company's gross payment volume (GPV) from larger sellers (sellers who generate more than $125,000 in annualized GPV) and mid-market sellers (sellers with $500,000 or more in annualized GPV).
Square has seen outsize growth from these sellers recently. GPV from larger and mid-market sellers combined increased 34% year over year in Q2 and accounted for 54% of total GPV -- up from 50% of GPV in the year-ago period. GPV from mid-market sellers, specifically, jumped 45% and accounted for 26% of GPV -- up from 22% of GPV in the year-ago quarter.
Investors should look for similarly robust GPV growth from these important sellers in Q3.
Roku earnings: Can video advertising drive more rapid growth?
Roku's stock has seen explosive growth over the past year, rising 140% year over year. This momentum comes as the company's year-over-year revenue growth rates have been accelerating. Second-quarter revenue rose 59% year over year. This compares to 51% growth in Q1.
The primary driver of Roku's strong growth has been the advertising revenue on its platform. In Q2, management said Roku-monetized video ad impressions more than doubled year over year during the quarter.
Investors should look for more strong growth in Roku-monetized ad impressions during Q3.
The Trade Desk earnings: Checking on revenue growth
Like Roku, The Trade Desk is also benefiting from rapid growth in connected-TV advertising. But the company's digital ad-buying platform helps brands and ad agencies buy ads programmatically across the rest of the internet as well.
The Trade Desk's two fastest-growing channels have been audio and connected TV, where ad spend increased 270% and 150% year over year, respectively, in Q2. But mobile video and mobile in-app channels also jumped sharply during the period, rising 50% and 63%, respectively.
Investors should check on The Trade Desk's growth rate for total revenue. After posting 42% year-over-year revenue growth in Q2, management guided for third-quarter revenue of $163 million -- a figure that implies 37% year-over-year growth.
Square and Roku report their third-quarter results after market close on Wednesday, Nov. 5. The Trade Desk will post its third-quarter update following the final bell.