PayPal’s Financial Results Beat On The Top And Bottom Lines

Financial technology company PayPal (PYPL) has reported fourth-quarter 2024 financial results that beat Wall Street forecasts on the top and bottom lines. The Silicon Valley-based company announced earnings per share (EPS) of $1.19 U.S., which topped consensus forecasts of $1.12 U.S.Revenue in the final three months of last year totaled $8.37 billion U.S, which was also ahead of the $8.26 billion U.S. that was expected. Sales were up 4% from a year ago.Total payment volume, an indication of how digital payments are faring in the broader economy, came in just shy of estimates at $437.8 billion U.S. compared to $438.2 billion U.S. that was anticipated on Wall Street.While PayPal’s take rate slipped to 1.91% from 1.96% a year earlier, transaction margin, which is how the company gauges the profitability of its core business, rose to 47% from 45.8%. Payments app Venmo, which PayPal owns, saw total payment volume rise 10% in the quarter from a year earlier. DoorDash, Starbucks and Ticketmaster are among businesses that now accept Venmo payments.The company said it added 8.8 million active accounts for all of 2024.Looking ahead to the current first quarter, PayPal said that it expects earnings per share (EPS) of $1.15 U.S. to $1.17 U.S., which is higher than the average analyst estimate of $1.13 U.S.Earnings for the entire year are forecast to come in at $4.95 U.S. to $5.10 U.S. per share, topping the $4.90 U.S. average estimate of analysts. Management said they anticipate growth of 4% to 5% in transaction margin dollars in 2025 to $15.20 billion U.S. to $15.40 billion U.S.PayPal also announced a new $15 billion U.S. share buyback program and said that it expects to make around $6 billion U.S. in stock repurchases throughout 2025.The stock of PayPal is down 6% on news of the company’s latest financial results. However, the share price has risen 45% over the last 12 months.