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FinancePayPal Q2 earnings beat estimates, raises full-year profit guidance
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PayPal reported second-quarter adjusted earnings of $1.38 per share, beating analyst expectations of $1.28, and raised its full-year profit guidance as CEO Enrique Lores's turnaround effort showed early progress. Revenue rose 5% year-over-year to $8.68 billion, exceeding the $8.47 billion consensus. The company now expects full-year adjusted earnings of $5.38 per share, up from $5.31 in 2025, and transaction margin dollars of roughly $15.6 billion, reversing prior guidance for a slight decline. Venmo Debit Card monthly active accounts grew more than 50% year-over-year, and Braintree total payment volume grew in the mid-teens. PayPal is on track to achieve $400 million in gross run-rate savings in 2026, with a longer-term target of at least $1.5 billion over two to three years. However, GAAP net income fell to $1.1 billion from $1.26 billion a year earlier, and non-GAAP operating margin contracted 248 basis points to 17.4%. PayPal stock fell roughly 2% in premarket trading following the report.
Source report
Author: Cris Tolomia Source: Quartz
Overview
PayPal reported second-quarter adjusted earnings of $1.38 per share on Tuesday, surpassing analyst expectations of $1.28. The company also raised its full-year profit guidance, as CEO Enrique Lores's turnaround effort showed early signs of progress.
Key Financial Results
- Revenue: $8.68 billion, up 5% year over year (vs. analyst estimate of $8.47 billion, per The Wall Street Journal)
- Adjusted EPS (Q2): $1.38 (beat estimate of $1.28)
- GAAP Net Income: $1.1 billion, or $1.25 per share (down from $1.26 billion, or $1.29 per share, a year earlier)
Full-Year Guidance
- Adjusted EPS: Now expected at $5.38 per share, compared to $5.31 in 2025
- Previous guidance: Called for a low-single-digit decline to slightly positive growth
- Transaction Margin Dollars: Expected to reach roughly $15.6 billion, up from $15.5 billion in 2025 — a reversal of prior guidance that had called for a slight decline
Q2 Operational Highlights
- Transaction Margin Dollars: Increased 1% to $3.9 billion (3% growth when excluding interest on customer balances)
- Total Payment Volume (currency-neutral): $486.4 billion, up 9% year over year
- Non-GAAP Operating Margin: 17.4%, contracting 248 basis points year over year, as non-transaction-related expenses rose 9%
CEO Commentary
"We moved with urgency to sharpen our transformation plan and advance our growth strategies across our three businesses. Branded checkout has further stabilized and we're building on the strong momentum in Venmo and Braintree as well as diversifying our business model through financial services."
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— Enrique Lores, CEO (took office in March, succeeding Alex Chriss)
Business Division Performance
- Venmo Debit Card: Monthly active accounts grew more than 50% year over year
- Braintree: Total payment volume grew in the mid-teens percentage range
- Cost Savings: On track to achieve $400 million in gross run-rate savings in 2026, with a longer-term target of at least $1.5 billion over the following two to three years
Q3 Outlook
PayPal projected that adjusted earnings in the third quarter would slip by a low-single-digit percentage compared to the $1.34 per share posted in the year-ago period.
Market Reaction
PayPal stock fell approximately 2% in premarket trading on Tuesday.
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Source
Yahoo FinanceWestern
Part of this Story
PayPal Q2 2026 Earnings Beat Estimates; Raises Full-Year Profit Guidance