PayPal Beats Q1 EPS, Stock Down 25% YTD

PayPal reported first-quarter 2025 earnings with adjusted EPS of $1.33, beating the Wall Street consensus of $1.16, while revenue was $7.79 billion, slightly under expectations of $7.84–$7.85 billion. The company reiterated its full-year 2025 adjusted EPS guidance of $4.95–$5.10, emphasizing a continued focus on profitability amid economic uncertainty and rising competition from Apple and Google. Transaction margin dollars increased 7% to $3.7 billion, reflecting CEO Alex Chriss’s strategy to prioritize higher-margin businesses and operational efficiency. Active user accounts grew by 2% to 436 million, with Venmo revenue up 20% and transaction volume up 10%. PayPal is investing in automation, AI, and new product features to boost branded checkout and Venmo monetization. Despite these efforts, concerns over revenue growth and market share losses have contributed to a 25% year-to-date decline in the company’s stock.