PayPal profit triples as pandemic drives continued surge in online payments.
The company made a series of product launches toward the end of the year.
The following written content by Emily Bary
Earnings, revenue top expectations for the fourth quarter
PayPal Holdings Inc.’s profit tripled in the fourth quarter as the company capped off what Chief Executive Dan Schulman called the strongest quarter in its history, fueled by accelerated adoption of digital payments during the pandemic.
Shares rose 5.5% in after-hours trading Wednesday.
The company reported net income of $1.57 billion, or $1.32 a share, up from $507 million, or 43 cents a share, in the year-earlier period. PayPal’s PYPL, 6.90% GAAP earnings per share for the latest quarter included a 60-cent net gain from strategic investments.
On an adjusted basis, PayPal earned $1.08 a share, which came in ahead of the FactSet consensus, which called for $1.00 a share.
PayPal generated $6.12 billion in revenue for its December quarter, up from $4.96 billion, while analysts were expecting $6.09 billion. This marked the first period in which PayPal reported upwards of $6 billion in quarterly revenue.
The company’s total payment volume (TPV), or the value of transactions made across the platform, rose to $277 billion from $199.4 billion, while analysts were calling for $267.9 billion. Venmo’s TPV rose 60% to $47 billion, whereas the FactSet consensus was for $46.6 billion.
During the busiest moments at the height of the holiday shopping season, PayPal was processing over 1,000 transactions a second, Schulman told MarketWatch, a record statistic for the company.
PayPal added 16 million net new active accounts in the latest quarter, bringing its total active accounts to 377 million, including 29 million merchant accounts. Venmo active accounts rose 32% to 70 million.
The company made a series of product launches toward the end of the year, including allowing U.S. users to buy, sell, and hold cryptocurrencies through its platform. Those customers who’ve purchased cryptocurrencies through PayPal have been logging into their accounts twice as frequently as they did before, the company said. Read more from Market Watch.
