A PayPal sign is visible at its headquarters in San Jose, California, on January 30, 2024.Justin Sullivan | Getty Images News | Getty ImagesPayPal achieved better-than-expected results in the fourth quarter on Wednesday, but issued guidance that fell slightly below estimates, causing shares to slip during extended trading. Here’s a breakdown of the company’s performance:
– Earnings per share: $1.48 adjusted vs. $1.36 expected by LSEG, formerly known as Refinitiv
– Revenue: $8.03 billion vs. $7.87 billion expected, according to LSEG
Revenue increased by 9% in the quarter, reaching $7.38 billion from a year earlier. Despite this growth, the number of active accounts decreased by 2% to 426 million, which fell short of analyst expectations of 427.17 million, reported by StreetAccount. Net income experienced a 52% rise to $1.4 billion, or $1.29 per share, from $921 million, or 81 cents per share, in the previous year.
The company’s total payment volume for the quarter reached $409.8 billion, marking a 15% increase from the previous year and surpassing the $405.51 billion expected by analysts polled by StreetAccount. However, PayPal provided guidance for the full year and first quarter that slightly missed expectations with anticipated full-year earnings of $5.10 per share, below the $5.48 analysts expected, according to LSEG. For the first quarter, PayPal estimated year-over-year earnings per share growth to fall in the mid-single digits, compared with a consensus estimate of 8.7%.
PayPal recently revealed plans to reduce its global workforce by 9%, amounting to about 2,500 jobs. This decision followed the introduction of new artificial intelligence features, which marked the first major announcement under CEO Alex Chriss, who has referred to it as the beginning of the company’s “next chapter.”
Chriss, a former Intuit executive, who took on the role of CEO in August, stated in the earnings release, “We’re driving significant transformation across our company and are committed to making the necessary changes to our business to drive profitable growth in the years ahead.”
The company’s shares have seen a 3% increase this year as of Wednesday’s close, after experiencing a decline for three consecutive years. They are currently standing at about 80% off their record from July 2021.
