PayPal reported on 27 October third-quarter net revenue of $8.58 billion, up just 2%, and net income of $1.07 billion, down 14%. Total payment volume rose 6% to $487.1 billion and transactions rose 7% to 6.8 billion. Adjusted earnings per share were $1.45, up 8%. The company raised its full-year adjusted EPS guidance to about $5.60, although revenue was below analysts' estimates.
What it means: PayPal looks like a mature company growing slowly and improving profitability through cost cuts and share buybacks rather than fast revenue growth. Payment volume is rising faster than revenue, which means the company earns less per transaction, mainly because much of its growth comes from processing payments for large merchants at low margins, while the more profitable PayPal button at online checkouts faces strong competition from Apple Pay, Google Pay and bank wallets. In Europe the pressure is increased by Wero, the shared wallet of European banks, and by instant payments. For Greek online shops, PayPal remains important for customers from abroad, but offering a range of payment methods at checkout matters more and more for conversion. It is worth regularly comparing each payment method's fees with the share of customers who use it, to see which methods are really worth their cost. PayPal is also trying to expand into payments by AI agents, as its rivals are.
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