PayPal Holdings early Tuesday reported second-quarter earnings and revenue that topped estimates while total payment volume came in slightly below views. PayPal stock climbed as other key metrics topped estimates.
Under new accounting rules, PayPal earnings for the June quarter rose 36% to $1.19 per share on an adjusted basis. Revenue climbed 8% to $7.9 billion, the digital payments firm said.
Analysts polled by FactSet expected PayPal earnings of 98 cents a share on revenue of $7.82 billion.
Transaction gross profit rose 6.5% to $3.2 billion, topping estimates by 1%.
"We've returned the company to transaction margin growth," said Chief Executive Alex Chriss on the company's earnings call with Wall Street analysts. "We've returned the company to consumer user growth. Also, we've significantly improved profitability of Braintree and we're accelerating Venmo. And so I just feel really proud that we are stronger today than we were six months ago."
PayPal Stock: EPS Outlook Raised
In Q2, total payment volume processed from merchant customers in the quarter climbed 11% to $416.8 billion. Analysts had projected total payment volume of $417.5 billion.
PayPal raised full year 2024 adjusted EPS growth guidance to the low-to-mid-teens versus prior estimate of mid to high single digits.
"Increased guidance primarily driven by better transaction margin dollars," said Evercore ISI analyst David Togut in a report. "That said for second half 2024, PayPal expects lower volume and revenue growth and reduced tailwind from interest income on customer balances."
San Jose, Calif.-based PayPal has evolved from an online checkout site to a mobile shopping and person-to-person payments site. Meanwhile, competition has heated up with Apple, Square-parent Block and others.
On the stock market today, PayPal stock rose 7.7% to 63.36 in midday trading.
Heading into the PayPal earnings report, shares were down 4% in 2024.
Meanwhile, Chriss took the helm in late September. He's been making big changes.
Follow Reinhardt Krause on Twitter @reinhardtk_tech for updates on artificial intelligence, cybersecurity and cloud computing.
