PayPal issues disappointing guidance even as fourth-quarter earnings top estimates

PayPal
reported
better-than-expected
fourth-quarter
results
Wednesday,
but
issued
guidance
that
was
a
bit
below
estimates.
The
shares
slid
8%
in
extended
trading.

Here’s
how
the
company
did:

• 
  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
9%
in
the
quarter
from
$7.38
billion
a
year
earlier.
The
number
of
active
accounts
fell
2%
to
426
million,
trailing
analyst
expectations
of
427.17
million,
according
to
StreetAccount.

Net
income
rose
52%
to
$1.4
billion,
or
$1.29
per
share,
from
$921
million,
or
81
cents
per
share,
a
year
earlier.

The
company
reported
total
payment
volume
of
$409.8
billion
for
the
quarter,
up
15%
from
the
prior
year
and
surpassing
the
$405.51
billion
expected
by
analysts
polled
by
StreetAccount. 

PayPal
provided
guidance
for
the
full
year
and
first
quarter
that
fell
just
short
of
expectations.
The
company
anticipates
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
would
fall
in
the
mid-single
digits,
compared
with
a
consensus
estimate
of
8.7%.

Finance
Chief
Jamie
Miller
said
on
the
earnings
call
that
the
company
will
stop
providing
annual
guidance,
and
instead
just
provide
an
outlook
for
the
current
quarter.

“Given
the
considerable
changes
underway
at
the
company,
we
believe
it
is
prudent
to
guide
revenue
one
quarter
ahead
and
provide
updates
as
the
year
progresses,”
Miller
said.

PayPal

announced
last
week
that
it
would
cut
9%
of
its
global
workforce,
or
about
2,500
jobs.
Last
month,
the
company
introduced
new
artificial
intelligence
features,
the
first
major
announcement
under
CEO
Alex
Chriss,
who
called
it
the
start
of
the
company’s
“next
chapter.”

“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,”
Chriss,
a
former
Intuit
executive,
who
was
named
CEO
in
August,
said
in
the
earnings
release.

Shares
of
PayPal
are
up
3%
this
year
as
of
Wednesday’s
close
after
falling
for
three
straight
years.
They’re
about
80%
off
their
record
from
July
2021.

WATCH:

PayPal
slides
on
Q4
results