PayPal Holdings Inc. delivered stronger-than-expected fourth-quarter results, surpassing analyst estimates in both earnings and revenue. The company reported earnings per share (EPS) of $1.19, exceeding the projected $1.12, while revenue came in at $8.37 billion, beating expectations of $8.26 billion.
Despite its solid financial performance, PayPal’s stock tumbled more than 9%, reflecting investor concerns over slowing card processing growth. The decline underscores broader apprehensions about the company’s ability to sustain its momentum in an increasingly competitive digital payments landscape.
CEO Alex Chriss expressed confidence in the company’s strategic direction, emphasizing a focus on innovation and expansion.
Venmo, one of PayPal’s key assets, posted a 10% increase in total payment volume year-over-year, reinforcing its role as a major growth driver. Chriss highlighted initiatives such as Fastlane and PayPal Everywhere, which aim to improve transaction efficiency and expand market reach.
In addition, the company is leveraging artificial intelligence and automation to enhance user experience and streamline operations. These investments are part of a broader effort to maintain PayPal’s competitive edge in the evolving payments ecosystem.
While PayPal has demonstrated resilience in several areas, challenges persist. Unbranded payment volume, a significant revenue contributor, declined to 2%, a sharp drop from 29% the previous year. The company expects upcoming renegotiations with key customers to impact revenue growth by approximately five percentage points in 2025.
To offset market concerns and reinforce investor confidence, PayPal has announced a $15 billion share repurchase program, with $6 billion in buybacks planned through 2025. This initiative is aimed at returning value to shareholders while signaling confidence in the company’s long-term growth prospects.
Despite the recent selloff, PayPal shares have gained 43% over the past year. The company currently holds a market capitalization of $81.68 billion. As of the latest trading session, PayPal’s stock is down over 9%, trading at $81.15.
During the session, shares hit a low of $80.20 and a high of $82.69, with a 52-week range spanning from $55.77 to $93.66. Analysts maintain a “Buy” rating on the stock, with a consensus price target of $96.25, suggesting room for potential upside.
As PayPal navigates a shifting payment landscape, it remains focused on innovation, strategic partnerships, and expanding its core offerings. With assets like Braintree and Venmo, the company is positioning itself to capture new growth opportunities while reinforcing its leadership in the digital payments space.
