Benjamin Godfrey is a blockchain enthusiast and journalists who relish writing about the real life applications of blockchain technology and innovations to drive general acceptance and worldwide integration of the emerging technology. His desires to educate people about cryptocurrencies inspires his contributions to renowned blockchain based media and sites. Benjamin Godfrey is a lover of sports and agriculture.
The reported revenue growth is said to be fueled by PayPal’s services diversification in various markets.
American payment service provider, PayPal Holdings Inc (NASDAQ: PYPL) has released its transaction revenue for the third quarter in which it recorded $5.61 billion, atop a growth of 10% from the year-ago period. The Earning Per Share the payment giant posted came in at $1.11 for the third quarter, and ahead of the $1.07 estimated polled by FactSet.
PayPal said its total payment volume for the quarter is $310 billion in the third quarter, up about 24% from the year-ago period. Total revenue was pegged at $6.18 billion in the third quarter up 13% from the year-ago period but was short of estimates of $6.23 billion.
The company announced that its US customers will now be able to pay with their Venmo app when they make payments on Amazon.com Inc (NASDAQ: AMZN). This move has been highlighted as a way to broaden and add more value to Venmo users.
“Our third-quarter results show solid growth on top of a record year. The strength of PayPal’s two-sided platform and ubiquity in our core markets has set us up to grow at scale, expand our work with existing merchants and attract new partners. We’re thrilled that we are teaming up with Amazon to enable customers in the U.S. to pay with Venmo at checkout,” said Dan Schulman, PayPal’s President, and Chief Executive Officer.
Schulman also said the Amazon partnership is crucial in its Venmo monetization efforts, adding that it “marks the beginning of an exciting journey with Amazon, now that we’re no longer constrained by the contractual obligations of the eBay operating agreement.”
PayPal also said it added 13.3 million new accounts in the third quarter, bringing the total number of active accounts to 416 million.
PayPal Revenue Growth: Product of Diversification
The reported PayPal revenue growth is fueled by the company’s diversification into various markets. Besides its legacy payment system, PayPal now offers a robust digital currency trading service that it has also taken to the United Kingdom. A significant portion of the company’s transaction revenue comes from its “buy, sell and hold” product, however, the company excludes crypto payments from total payment volume.
“Our third quarter performance demonstrates the strength of our diversified platform, our global reach, and the scalability of our business. The powerful and accelerating secular tailwinds of increasing ecommerce penetration and cash displacement have helped to advance our leadership position,” said John Rainey, CFO, and EVP, Global Customer Operations.
Digital currencies have contributed to the improved activities on the PayPal platform, with the firm confirming that customers who purchased crypto through the platform have been logging into PayPal twice as often as they were before they could buy crypto.
The improved performance pushed PayPal shares to new highs as it closed Monday’s trading session up 1.61% to $229.42. However, the shares have corrected 3.10% in the pre-market as its projected fourth-quarter revenue is expected to be in the range of $6.85 billion to $6.95 billion, which was below the consensus estimate of $7.24 billion.