Key Takeaways
- PayPal exceeded second-quarter profit and sales estimates, and raised its guidance and stock buybacks, powered by strong transactions.
- Transaction revenue beat forecasts, and transaction margin dollars were the most since 2021.
- Shares soared to move into positive territory for the year.
PayPal Holdings (PYPL) shares shot higher Tuesday after the electronic payment service posted better-than-anticipated results and boosted both its guidance and stock buybacks on strong transaction gains.
The company reported second-quarter earnings per share (EPS) of $1.08, with revenue rising 8% year-over-year to $7.89 billion. Both exceeded consensus estimates of analysts polled by Visible Alpha.
Transaction revenue increased 9% to $7.15 billion, also more than forecasts, and transaction margin dollars were up 8% to $3.61 billion, which the company said was the best growth since 2021.
PayPal CEO Touts ‘Strength of Our Business’ Amid Guidance Raise
Chief Executive Officer (CEO) Alex Chriss said, “Given the strength of our business, we are raising our 2024 guidance and increasing share repurchases.” PayPal now sees full-year adjusted EPS growing by a low- to mid-teens percentage, up from to its earlier outlook of a mid- to high-single-digit percentage. The company is lifting its share repurchase guidance to $6 billion from at least $5 billion.
The news sent shares of PayPal Holdings up 7.6% to $63.41 as of 10:25 a.m. ET Tuesday, moving into positive territory for the year.