Financial technology company PayPal released fourth-quarter earnings that surpassed analysts’ expectations. Revenue for the three-month period rose 4%, peaking at $8.37 billion and exceeding the $8.26 billion projected by Wall Street.
Earnings per share (EPS) came in at an adjusted $1.19, which also beat estimates of $1.12. The fintech company’s payments volume increased by 7%, reaching almost $438 billion, during the quarter. Measuring the profitability of PayPal’s volume, the transaction margin rose 7%, hitting $3.93 billion.
“PayPal had a strong finish to a successful 2024 with results that were better than we expected,” stated CEO Alex Chriss in the earnings statement. “The strong momentum we’ve created sets us up well for 2025, which is about scaling adoption.”
The number of active accounts also increased in Q4 2024. Roughly 3 million new accounts were opened, giving the company a total of 434 million.
Projections for Q1 2025 include adjusted EPS between $1.15 and $1.17. The company expects $3.60 billion to $3.65 billion in transaction-margin dollars and estimates adjusted EPS of $4.95 to $5.10 for 2025. Transaction-margin dollars will likely hit between $15.2 billion and $15.4 billion, a 4%-5% uptick.
Convenient Shopping via PayPal
One particularly bright spot in PayPal’s earnings report was Venmo, the company’s payment app. Compared to Q3 2023, payment volume increased by 10% in the last quarter. The uptick was helped significantly by companies like Starbucks and Ticketmaster accepting Venmo as a payment method.
Newly active Venmo debit card accounts surged 30% last year. Pay with Venmo, which allows customers to make online purchases, saw an over 20% boost in active accounts.
The fintech’s buy now, pay later (BNPL) service brought in $33 billion in payment volume, a 21% increase versus 2023. According to the company, BNPL customers typically spend an average of 30% more when shopping.
The company launched its PayPal Everywhere initiative in September 2024. The program gives 5% cash back when customers pay using a PayPal debit card inside its mobile app.
Also in September, online giant Amazon added PayPal as an option to pay Buy with Prime purchases. The new payment method helps both PayPal and Amazon attract shoppers by providing convenient and fast checkout.
