PayPal (PYPL) Q3 2024 earnings

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(PYPL) Q3 2024 earnings

A

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sign is seen at its headquarters in San Jose, California, Jan. 30, 2024.

Justin Sullivan | Getty Images News | Getty Images

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reported better-than-expected third-quarter earnings on Tuesday, but revenue came in a bit light of expectations.

Here’s how the company did compared to Wall Street estimates, based on a survey of analysts by LSEG:

Earnings per share: $1.20, adjusted vs. $1.07 expectedRevenue: $7.85 billion vs. $7.89 billion expected

Revenue increased about 6% in the quarter from $7.42 billion in the same ******* a year ago.

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reported net income of $1.01 billion, or 99 cents per share, compared to $1.02 billion, or 93 cents per share, a year earlier.

It’s the first earnings report for CEO Alex Chriss since he reached his one-year mark on the job in September. The stock is up 36% this year and 42% since Chriss joined the payments company, which at the time was mired in a deep slump due to increased competition and a declining take rate, or the percentage of revenue

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keeps from each transaction.

Chriss has focused on prioritizing profitable growth and better monetizing key acquisitions like Braintree, which is used by Meta for credit card processing, and payments app Venmo.

Total payment volume, an indication of how digital payments are faring in the broader economy, rose 9% from a year earlier to $422.6 billion for the quarter ended Sept. 30, and came in just above the average analyst estimate of $422.5 billion, according to StreetAccount.

“

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delivered strong financial and operating results during a highly productive third quarter,” Chriss said in the earnings release.

The company’s operating margin came in at 18.8%, beating the StreetAccount estimate of 17.4%.

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reported total active accounts of 432 million, up 1% from a year earlier, and beating the average estimate of 430.5 million.

While

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’s take rate slipped to 1.86% from 1.91% a year earlier, transaction margin, which is how the company gauges the profitability of its core business, rose to 46.6% from 45.4%.

For the fourth quarter,

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is calling for “low single-digit growth.” Analysts were expecting growth of 5.4% to $8.46 billion. The investor deck says guidance reflects a “price-to-value strategy and prioritization of profitable growth.” 

The company expects adjusted earnings per share of $1.07 to $1.11, versus the average analyst estimate of $1.10, according to LSEG.  

One of Chriss’ strategies to address the deteriorating margin was to offer merchants increased value-added services, such as connecting a couple of data points at checkout to drive down the rate of cart abandonment. That product, dubbed

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,

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, and is a one-click payment option for online sales that can go head-to-head with Apple Pay and Shop Pay by 

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.

In August, fintech platform Adyen made Fastlane 

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 in the U.S., and said it plans to expand the offering globally in the future. The company also partnered with other leaders in global commerce including

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,

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,

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and

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as it looks to grow its share of online checkout.

The other big product launch during the quarter was

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Everywhere, which went live

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. The initiative offers 5% cash back for using a

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debit card within the mobile app. Thus far,

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has seen 1 million new

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debit card enrollments.

Venmo’s total payment volume rose 8% in the quarter from a year earlier. DoorDash, Starbucks and Ticketmaster are among businesses 

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 as one way that consumers can pay.

“We are making solid progress in our transformation as we bring new innovations to market, forge important partnerships with leading commerce players, and drive awareness and engagement through new marketing campaigns,” Chriss said in the release.

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will hold an earnings call for analysts at 8 a.m. Eastern time.

WATCH:

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’s crypto lead on allowing merchants to buy and sell virtual assets

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#

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#PYPL #earnings

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