Key points
PayPal reported better-than-expected fourth-quarter earnings and revenue in its quarterly report on Tuesday.
The company also issued guidance that topped estimates.
Venmo’s total payment volume rose 10% in the quarter from a year earlier.
PayPal reported better-than-expected fourth-quarter results on Tuesday and issued guidance that also topped analysts’ expectations. The shares slid more than 8% in premarket trading.
Here’s how the company did compared with Wall Street estimates, based on a survey of analysts by LSEG:
Earnings per share: $1.19, adjusted vs. $1.12 expected
Revenue: $8.37 billion vs. $8.26 billion expected
For the first quarter, PayPal expects adjusted earnings per share of $1.15 to $1.17, which is higher than the average analyst estimate of $1.13, though adjusted net income fell 1.9% to $1.21 billion. Earnings for the year will come in at $4.95 to $5.10 a share, topping the $4.90 average estimate, according to LSEG.
PayPal also announced a new $15 billion share buyback program, and expects to make around $6 billion in repurchases in 2025.
Revenue increased about 4% in the quarter from $8.03 billion a year ago.
Total payment volume, an indication of how digital payments are faring in the broader economy, was just short of estimates, coming in at $437.8 billion for the fourth quarter, versus the $438.2 billion analysts projected.
Unbranded payment volume — or the transactions PayPal handles for external businesses rather than its own platform — declined again in the fourth quarter as the company continues to pursue a price-to-value strategy, falling to 2% from 29% a year earlier. Chief Financial Officer Jamie Miller said during the earnings call the company expects “similar dynamics the next few quarters” and that over 2025, they expect renegotiations with existing customers to be an approximately “five-point revenue growth headwind.”
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