PayPal Stories Archive

PayPal Reports Q2'17 Results & Raises Financial Guidance for Year
Revenue increased 18% to $3.136 billion, 20% FX-neutral revenue growth
GAAP EPS increased 27% to $0.34, non-GAAP EPS increased 27% to $0.46
SAN JOSE, Calif.--(BUSINESS WIRE)-- Global technology platform and digital payments leader PayPal Holdings, Inc. (NASDAQ:PYPL) today announced second quarter results for the period ended June 30, 2017.
Financial highlights for the second quarter include:
  • Revenue growth of 18% to $3.136 billion, or 20% on a foreign currency neutral (FX-neutral) basis
  • GAAP operating margin of 13.7% and non-GAAP operating margin of 21.0%
  • GAAP earnings per diluted share (EPS) growth of 27% to $0.34, non-GAAP EPS growth of 27% to $0.46
  • Operating cash flow of $921 million, free cash flow of $747 million
Operating highlights for the second quarter include:
  • 6.5 million active customer accounts added with net new additions up 80%
  • Ended the quarter with 210 million active customer accounts, including 17 million merchant accounts
  • 1.8 billion payment transactions, up 23%
  • 32.3 payment transactions per active account on a trailing twelve months basis, up 10%
  • $106 billion in total payment volume (TPV), up 23%, or 26% on an FX-neutral basis
“The accelerating and extensive scale of our two-sided global platform creates a strong foundation for PayPal’s growth, enabling consumers and merchants to transact in new contexts and across operating systems, technologies and platforms,” said Dan Schulman, President and CEO of PayPal. “Our strong results reflect PayPal’s transformation from a single product to a platform company, from a vendor to a strategic partner to both merchants and ecosystem players, and from a checkout option to an increasingly more central way for consumers to manage and move their money.”
Building Momentum with Strategic Partnerships
Important strategic partnerships are broadening the relevance of PayPal's platform and increasing PayPal's addressable market. Recently, PayPal announced the following agreements:
  • Baidu: Today, PayPal announced a partnership with Baidu to allow Chinese consumers to pay with Baidu Wallet and PayPal at PayPal’s millions of merchants outside of China.
  • BofA: Enables Bank of America-issued cards to be easily added to PayPal accounts.
  • Citi: Enables eligible Citi cardmembers to use their ThankYou Points to pay for all or part of their purchases when shopping online at millions of merchants that accept PayPal in the United States.
  • JPMorgan Chase: Enables Chase-issued cards to be easily added to PayPal accounts and allows joint customers to use their Chase Ultimate Rewards points anywhere PayPal is accepted online and in app.
  • Visa: Existing partnership agreement extended into Europe.
  • Samsung Pay: Users of Samsung Pay in the U.S. will be able to use PayPal to make purchases in stores where Samsung Pay is accepted.
  • Apple: iTunes users can buy games, music, movies and in app purchases with PayPal in the Apple App Store, iBooks, Apple Music and iTunes stores in 12 countries, including the U.S., Australia and parts of Europe.
  • Google: Android Pay users on Google’s Chrome mobile web will be able to pay at millions of online merchants that accept PayPal, using their PayPal account and fingerprint authentication.
Expanding Value Proposition with Product Innovation
Mobile-first product development focus is driving performance across PayPal's business. PayPal processed $106 billion in TPV in the quarter. Approximately 34% of payment volume came through a mobile device and mobile payment volume increased 50% over the same period last year to approximately $36 billion. In addition, Venmo, the company's social payments platform, processed $8.0 billion of TPV, growing 103% over the same period last year.
PayPal finished the quarter with more than 60 million consumer accounts opted in to One Touch. In addition, more than 5.5 million merchant accounts and 75% of the Internet Retailer 100 now accept One Touch on their mobile and desktop shopping experiences.
On July 18, 2017, PayPal announced the closing of the acquisition of TIO Networks for approximately $238 million. TIO is a leading cloud-based, multi-channel bill payment processor, serving leading telecom, wireless, cable, and utility bill issuers in North America. Through this acquisition, PayPal intends to expand its scale of operations, complement its product portfolio, and accelerate its entry into the bill pay market, enabling millions of customers to improve their financial health through access to TIO's valuable services.
2017 Financial Guidance
Full Year 2017 Revenue and Earnings Guidance Raised
  • PayPal expects revenue to grow 18 - 19% at current spot rates and 19 - 20% on an FX-neutral basis, to a range of $12.775 - $12.875 billion.
  • PayPal expects GAAP earnings per diluted share in the range of $1.32 - $1.36 and non-GAAP earnings per diluted share in the range of $1.80 - $1.84.
  • Estimated non-GAAP amounts above for the twelve months ending December 31, 2017, reflect adjustments of approximately $840 - $880 million, primarily representing estimated stock-based compensation expense and related employer payroll taxes in the range of $690 - $720 million.
Third Quarter 2017 Revenue and Earnings Guidance
  • PayPal expects revenue to grow 18% - 20% at current spot rates and 18% - 20% on an FX-neutral basis, to a range of $3.140 - $3.190 billion.
  • PayPal expects GAAP earnings per diluted share in the range of $0.30 - $0.32 and non-GAAP earnings per diluted share in the range of $0.42 - $0.44.
  • Estimated non-GAAP amounts above for the three months ending September 30, 2017, reflect adjustments of approximately $200 - $215 million, primarily representing estimated stock-based compensation expense and related employer payroll taxes in the range of $180 - $190 million.
Please see "Non-GAAP Financial Measures" and "Non-GAAP Measures of Financial Performance" for important additional information.
Quarterly Conference Call and Webcast
PayPal Holdings, Inc. will host a conference call to discuss second quarter 2017 results at 2:00 p.m. Pacific Time today. A live webcast of the conference call, together with a slide presentation that includes supplemental financial information and reconciliations of certain non-GAAP and non-GAAP pro forma measures to their most directly comparable GAAP measures, can be accessed through the company's Investor Relations website at In addition, an archive of the webcast will be accessible for 90 days through the same link.
PayPal Holdings, Inc. uses its Investor Relations website (, its PayPal Stories Blog(, Twitter handle (@PayPal), LinkedIn page (, Facebook page ( and YouTube channel ( as a means of disclosing information about the company and for complying with its disclosure obligations under Regulation FD. The information we post through these channels may be deemed material. Accordingly, investors should monitor these channels in addition to PayPal’s press releases, SEC filings, public conference calls and webcasts.
About PayPal
Fueled by a fundamental belief that having access to financial services creates opportunity, PayPal (Nasdaq: PYPL) is committed to democratizing financial services and empowering people and businesses to join and thrive in the global economy. Our open digital payments platform gives PayPal’s 210 million active account holders the confidence to connect and transact in new and powerful ways, whether they are online, on a mobile device, in an app, or in person. Through a combination of technological innovation and strategic partnerships, PayPal creates better ways to manage and move money, and offers choice and flexibility when sending payments, paying or getting paid. Available in more than 200 markets around the world, the PayPal platform, including Braintree, Venmo and Xoom, enables consumers and merchants to receive money in more than 100 currencies, withdraw funds in 56 currencies and hold balances in their PayPal accounts in 25 currencies. For more information on PayPal, visit For PayPal financial information, visit
All growth rates represent year-over-year comparisons, except as otherwise noted. FX-neutral results are calculated by translating the current period local currency results by the prior period exchange rate. FX-neutral growth rates are calculated by comparing the current period FX-neutral results by the prior period results, excluding the impact from hedging activities. All amounts in tables are presented in U.S. dollars, rounded to the nearest millions, except as otherwise noted. As a result, certain amounts may not sum or recalculate using the rounded dollar amounts provided.
Non-GAAP Financial Measures
This press release includes the following financial measures defined as “non-GAAP financial measures” by the Securities and Exchange Commission (SEC): non-GAAP net income, non-GAAP earnings per diluted share, non-GAAP operating margin, non-GAAP effective tax rate and free cash flow. For an explanation of the foregoing non-GAAP measures, please see “Non-GAAP Measures of Financial Performance” included in this press release. These measures may be different from non-GAAP financial measures used by other companies. The presentation of this financial information, which is not prepared under any comprehensive set of accounting rules or principles, is not intended to be considered in isolation of, or as a substitute for, the financial information prepared and presented in accordance with generally accepted accounting principles (GAAP). In addition, the company has included certain pro forma adjustments in its presentation of certain historical revenue measures. The company believes that this presentation provides investors a consistent basis for assessing the company’s performance and helps to facilitate comparisons across different periods. These pro forma adjustments reflect items that are factually supportable, directly attributable to the separation of the company from eBay Inc. on July 17, 2015, and expected to have a continuing impact on the company’s results of operations. For a reconciliation of these non-GAAP financial measures and non-GAAP pro forma comparisons to the most directly comparable GAAP measures, see “Non-GAAP Measures of Financial Performance,” “Reconciliation of GAAP Operating Margin to Non-GAAP Operating Margin,” “Reconciliation of GAAP Net Income to Non-GAAP Net Income, GAAP Diluted EPS to Non-GAAP Diluted EPS and GAAP Effective Tax Rate to Non-GAAP Effective Tax Rate,” “Reconciliation of Operating Cash Flow to Free Cash Flow”, “Reconciliation of GAAP Net Revenues by Type to Non-GAAP Pro Forma Net Revenues by Type” and GAAP Net Revenues by Geography to Non-GAAP Pro Forma Net Revenues by Geography”.
Forward-Looking Statements
This press release contains forward-looking statements relating to, among other things, the future results of operations, financial condition, expectations and plans of PayPal Holdings, Inc. and its consolidated subsidiaries that reflect PayPal’s current projections and forecasts. Forward-looking statements can be identified by words such as “may,” “will,” “would,” “should,” “could,” “expect,” “anticipate,” “believe,” “estimate,” “intend,” “plan,” “project,” “forecast” and other similar expressions. Forward-looking statements include, but are not limited to, statements regarding projected financial results for third quarter and the full year 2017 and projected future growth of PayPal’s businesses. Forward-looking statements are based upon various estimates and assumptions, as well as information known to PayPal as of the date of this press release, and are inherently subject to numerous risks and uncertainties. Accordingly, actual results could differ materially from those predicted or implied by forward-looking statements. Factors that could cause or contribute to such differences include, but are not limited to: changes in political, business and economic conditions, including any regional or general economic downturn or crisis and any conditions that affect payments or e-commerce growth; fluctuations in foreign currency exchange rates; the competitive, regulatory, payment card association-related and other risks specific to the PayPal, PayPal Credit, Braintree, Venmo, Xoom and Paydiant products, especially as PayPal continues to expand geographically and introduce new products and as new laws and regulations related to payments and financial services come into effect; the impact of PayPal's customer choice initiatives, including on its funding mix and transaction expense; PayPal’s ability to successfully react to the increasing importance of mobile payments and mobile commerce; PayPal’s ability to deal with the increasingly competitive environment for its businesses, including competition for consumers and merchants; the outcome of legal and regulatory proceedings and PayPal's need and ability to manage other regulatory, tax and litigation risks as its products and services are offered in more jurisdictions and applicable laws become more restrictive; changes to PayPal's capital allocation or management of operating cash; uncertainty surrounding the implementation and impact of the United Kingdom's formal notification of its intent to withdraw from the European Union; PayPal's need to manage an increasingly large enterprise with a broad range of businesses of varying degrees of maturity and in many different geographies; the effect of management changes and business initiatives; any changes PayPal may make to its product offerings; PayPal's ability to timely upgrade and develop its technology systems, infrastructure and customer service capabilities at reasonable cost; PayPal's ability to maintain the stability, security and performance of its Payment Platform while adding new products and features in a timely fashion; risks that planned acquisitions will not be completed on contemplated terms, or at all, and that any businesses PayPal may acquire will not perform in accordance with its expectations, and PayPal's ability to profitably integrate, manage and grow businesses that have been acquired or may be acquired in the future. The forward-looking statements in this release do not include the potential impact of any acquisitions or divestitures that may be announced and/or completed after the date hereof.
More information about factors that could adversely affect PayPal's results of operations, financial condition and prospects or that could cause actual results to differ from those expressed or implied in forward-looking statements is included under the captions “Risk Factors” and “Management's Discussion and Analysis of Financial Condition and Results of Operations” in PayPal’s most recent annual report on Form 10-K and its subsequent quarterly reports on Form 10-Q, copies of which may be obtained by visiting PayPal's Investor Relations website at or the SEC's website at All information in this release is as of July 26, 2017. For the reasons discussed above, you should not place undue reliance on the forward-looking statements in this press release. PayPal assumes no obligation to update such forward-looking statements.


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