PYPL changes
Pick any two versions below to diff them.
- Price
- $57.16 → $57.20(+0.1%)
- Discount
- 15% to 38% → 15% to 37%(−0.0 pts)
- Next earnings is estimate
- Yes → No
- Thesis
- The market fears that PayPal's most profitable business, branded checkout, will keep losing share. Apple Pay, Shop Pay and other wallets compete at the online checkout, and AI shopping agents, such as Meta's Muse, can move the purchase decision away from the PayPal button. In Q2 2026, payment volume grew 10%, but transaction margin dollars grew only 1% and the non-GAAP operating margin fell 248 basis points. Active accounts were almost flat at 439 million. PayPal named Enrique Lores CEO in February 2026, and he started a new reorganization, so investors also wait to see whether the turnaround plan works. For the gap to close, three things must be true. Transaction margin dollars excluding interest on customer balances must grow faster than the 3% of Q2 2026, with branded checkout stable or growing. PayPal must reach its raised 2026 non-GAAP EPS guidance of about $5.38 while it keeps share buybacks near $1.5 billion a quarter. Venmo must keep growing its revenue, and PayPal must win a share of payments that AI agents make, as with its Meta Muse checkout deal of September 2026. The Q3 report, expected in late on October 27, 2026, is the next test, and the Q4 report with the 2027 outlook in early February 2027 is the second. Because the fear of share loss to wallets and AI agents fades only with years of steady checkout growth, the gap can close only slowly.
- Checkpoints
- Oct 27, 2026 (estimate): Q3 2026 results: checkout and transaction margin. Pending. Watch: Transaction margin dollars excluding interest on customer balances that grow faster than the 3% of Q2 and a 2026 EPS guidance kept near $5.38 pass; slower growth or a lower guidance fails. Feb 2027 (estimate): Q4 2026 results and 2027 outlook. Pending. Watch: A 2027 outlook with growth in non-GAAP EPS and transaction margin dollars passes; another year of falling margins fails.
- Recent events
- 2026-10-05: Venmo said that its credit card now pays up to 4% cash back on purchases that users split with friends. 2026-09-22: PayPal said that its customers will be able to shop and check out with Meta's Muse AI agent at PayPal merchants. PayPal did not give financial terms or a launch date. 2026-08-28: Bloomberg reported that Stripe and Advent International stopped their attempt to buy PayPal, two weeks after the talks started again. Reports said that the two sides did not agree on the value of PayPal. PayPal did not comment. 2026-07-28: PayPal reported Q2 2026 results. Revenue rose 5% to $8.7 billion, and payment volume rose 10% to $486.4 billion. Transaction margin dollars rose 1% to $3.9 billion, and non-GAAP EPS fell 1% to $1.38. Free cash flow was $1.8 billion, and buybacks were $1.5 billion. PayPal raised its 2026 non-GAAP EPS guidance to about $5.38. 2026-07-15: Reuters reported that Stripe and Advent International offered $60.50 per share, more than $53 billion in total, to buy PayPal. PayPal did not comment. 2026-05-05: PayPal reported Q1 2026 results and gave details of its new operating model. It guided 2026 non-GAAP EPS from a low-single-digit decline to slightly positive. 2026-04-29: PayPal reorganized into three businesses: Checkout Solutions & PayPal, Consumer Financial Services & Venmo, and Payment Services & Crypto. The heads of the Consumer Group and of the Small Business & Financial Services Group left the company.