Shares in payments startup Square Inc. dropped in after-hours trading today after the company predicted lower-than-expected estimates for its current quarter.

Beating market expectations, Square reported a profit of 13 cents a share, versus an expected 11 cents, with total revenue coming in at $431 million versus a predicted figure of $414.1 million.

Looking forward, Square said it expected revenue of 12 to 13 cents a share in the fourth quarter on adjusted revenue between $446 million and $451 million. Analysts projected 15 cents a share on sales of $440.6 million, according to Bloomberg.

Increasing expenses are partially behind the underwhelming projections, with Square reporting operating expenses, excluding certain items, rising 56 percent in the third quarter from a year ago, representing 67 percent of adjusted revenue. Costs were up in all categories, including hiring and advertising.

On a positive note, Square reported its first quarterly profit of $20 million, a turnaround of $36 million from a year ago, though part of it was attributed to Square profiting from the sale of some of the shares it owned in the initial public offering of Eventbrite Inc. in September.

The projections came at a difficult time for Square after Chief Financial Officer Sarah Friar had announced that she was leaving the company last month to join Nextdoor Inc. as chief executive officer.

The announcement saw Square’s stock drop by as much as 16 percent in October as investors considered what it meant. People leaving companies isn’t exactly new, but Friar is claimed to have an unusually influential role because company CEO Jack Dorsey (pictured) splits his time between Square and Twitter Inc., meaning that in some ways Friar was proxy CEO in Dorsey’s absence.

Square’s share price dropped nearly 9 percent initially after the financials were released before recovering slightly to $80.15, down 3 percent as of 6:30 p.m. PST. They closed up almost 7 percent in the regular session.

Photo: jdlasica/Flickr