PayPal revenue growth, continues expansion in the crypto field, for customers holding over 1 billion in crypto assets

Payment giant PayPal announced its second-quarter financial report for 2023, with revenue growing to $7.3 billion and adjusted EPS of $1.16, surpassing market expectations. PayPal holds cryptocurrency worth as much as $1.016 billion for its customers, showing a gradual increase trend. In addition, PayPal continues its share buyback program, and the successor to CEO Daniel H. Schulman is soon to be announced.

Revenue Growth and Increased Transaction Volume

Payment system provider PayPal, stock code PYPL, released its latest financial report, which exceeded expectations in the second quarter. For the second quarter ending June, PayPal's revenue grew by 7% year-on-year to $7.3 billion, with an adjusted EPS of $1.16, outperforming market expectations. With inflation easing and e-commerce picking up, Total Payment Volume (TPV) increased by 11% annually to $376.5 billion, and the number of transactions per active user also increased by 12%.

Holding $10.16 Billion in Cryptocurrency for Customers

PayPal has been operating in the field of cryptocurrency for a long time. It first launched cryptocurrency trading features in October 2020 and obtained a BitLicense license from the New York State Department of Financial Services (NYDFS) for conducting virtual currency-related business activities in June 2022. Subsequently, it provided the function for verified U.S. users to transfer cryptocurrency to external addresses, including exchanges and hardware wallets.

In December 2022, PayPal once again collaborated with MetaMask to introduce purchasing options through PayPal in the MetaMask wallet for U.S. users.

Currently, the cryptocurrencies available on PayPal include BTC, ETH, BCH, and LTC, as well as the newly launched stablecoin PYUSD. Bitcoin accounts for the majority, and the value of cryptocurrency this quarter has reached $10.16 billion, compared to $9.43 billion in the previous quarter and $6.04 billion at the end of 2022, showing a gradual increasing trend.

Continued Stock Buybacks, Successor to CEO Soon to Be Announced

Daniel H. Schulman has been serving as CEO of PayPal since its separation from eBay in 2015. Now 65 years old, he announced in February of this year that he will step down from the CEO position at the end of the year. During this earnings call, Schulman also mentioned the CEO succession plan, stating that there are several excellent candidates in the final stages, and he looks forward to the next CEO of PayPal. He emphasized that he will first move to a position on the board of directors and provide support to the new leadership.

In the second quarter, PayPal continued to repurchase its own stock, completing $1.5 billion in stock buybacks in the second quarter, compared to $1.4 billion in the first quarter. The company is estimated to repurchase $5 billion in total for the year.

However, perhaps the market had already anticipated PayPal's growth in the financial report, as PayPal's stock price rose from $58 at the end of May to $76, but it fell significantly after the financial report was released and closed at $64.42 yesterday.