AUS
NZ
UK
CA
USA
IND
Highlights
- PayPal added 13.3 million net new active accounts, taking the total to 416 million active accounts in the quarter. Its total payment volume was US$310 billion, up 26% YoY.
- The company expects its net revenue to increase between US$6.85 billion and US$6.95 billion in Q4, representing growth of 12% and 14%, respectively, at current spot rates.
- PayPal expects its net new active accounts to be 55 million in fiscal 2021, including 3 million accounts added from the acquisition of Paidy.
PayPal Holdings, Inc. (NASDAQ:PYPL) on Monday posted net revenue of US$6.18 billion in the third quarter of fiscal 2021, helped by robust growth in payment volume and new customers.
The PayPal (PYPL) stock was up 1.87% in intraday trading ahead of the financial report.
Third-Quarter Highlights
PayPal added 13.3 million net new active accounts, taking the total to 416 million active accounts in the quarter. Its total payment volume (TPV) was US$310 billion, up 26% YoY, in the period.
PayPal’s GAAP earnings per share (EPS) rose to US$0.92 from US$0.86 a year ago. Likewise, the non-GAAP EPS was US$1.11 versus US$1.07 in Q3 of 2020.
The company’s operating cash flow of US$1.51 billion was an increase of 15% YoY, while the free cash flow was up 20% YoY to US$1.29 billion.
Q4 Guidance
The company expects its net revenue to increase between US$6.85 billion and US$6.95 billion, representing growth of 12% and 14%, respectively, at current spot rates.
It expects the GAAP diluted earnings per share to be US$0.79, versus US$1.32 per share a year ago. At the same time, the non-GAAP diluted earnings per share are expected to increase by 4% to US$1.12.
Full-year Guidance
PayPal’s expects its total payment volume (TPV) to grow in the range of 33% to 34% at current spot rates, while net revenue to be in the range of US$25.3 billion to US$25.4 billion.
The GAAP EPS is likely to be US$3.62 against US$3.54 in FY20. In addition, the non-GAAP EPS is expected to increase by 19% to US$4.60.
PayPal expects its net new active accounts to be 55 million in fiscal 2021, including 3 million accounts added from the acquisition of Paidy.
Also Read: Top airline stocks to watch as US lifts travel curbs
Source: Pixabay
Also Read: Top 5 IPOs to keep an eye on this week
Holiday sales push
On Nov 1, PayPal announced a reward program through which its customers in the US, Germany, France, and the UK can win US$10,000 and thousands of other prizes every week. They can win the prizes simply by checking out or donating through its platform this holiday season.
The program will continue till Dec 19, PayPal said in a release.
PayPal’s Consumer Marketing Vice-President Bob Rupczynski said the company is excited to give back to its loyal customers as they navigate their holiday shopping over the next six weeks.
Early in October, it had launched a cashback program through the Honey browser extension.
US users can earn and redeem Honey Gold reward points while shopping online. But they must link their Honey browser extension and PayPal account to redeem the points for cash through PayPal.
Stock Performance
The PayPal (PYPL) stock fell 0.8% YTD. Its 52-week highest price was US$310.16, and the lowest price was US$178.60. In addition, its P/E ratio is 56.01, the forward P/E one-year ratio is 64.88, and the EPS is US$4.10. PayPal’s current market cap is around US$269.83 billion.
Bottomline
Analysts expect e-commerce spending to grow by 15% this holiday season compared to the previous year. Many companies have launched reward programs like cashback and prizes for shoppers to lure them to their stores during the upcoming holiday season. For example, PayPal users can redeem their gold points earned through the Honey app for cash using its account. However, investors must evaluate the companies carefully before investing in stocks.
