Consolidated Statements of Cash Flows UNAUDITED In thousands THREE MONTHS ENDED Cash Flows from Operating Activities Mar 31, 2018 Mar 31, 2017 Net loss $ (23,986) $ (15,090) Adjustments to reconcile net loss to net cash provided by operating activities: Depreciation and amortization 10,160 9,437 Non-cash interest and other expense 4,847 1,534 Share-based compensation 46,824 31,670 Transaction, loan and advance losses 18,031 11,891 Deferred provision (benefit) for income taxes (654) 99 Changes in operating assets and liabilities: Settlements receivable (81,452) 54,586 Customer funds (49,619) (13,953) Purchase of loans held for sale (344,976) (252,170) Sales and principal payments of loans held for sale 337,092 242,431 Other current assets (13,444) 6,105 Other non-current assets (1,256) 141 Accounts payable 1,990 (1,459) Customers payable 147,977 (11,132) Settlements payable 2,114 (15,378) Charge-offs to accrued transaction losses (12,842) (11,178) Accrued expenses 2,703 3,930 Other current liabilities 3,165 (368) Other non-current liabilities 5,379 2,902 Net cash provided by operating activities 52,053 43,998 Cash Flows from Investing Activities Purchase of marketable securities (50,221) (181,851) Proceeds from maturities of marketable securities 45,450 15,569 Proceeds from sale of marketable securities — 3,996 Purchase of property and equipment (8,083) (6,508) Payment for investment in privately held entity — — Purchase of intangible assets (1,584) — Business acquisitions (1,055) (1,600) Net cash used in investing activities: (15,493) (170,394) 17
2018 Q1 Shareholder Letter — Square Page 16 Page 18