PayPal increased its revenues by 23%
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Paypal's revenue increase
PayPal increased its Q4 revenues by 23% and the number of active customers by 24% to 16 million, its new cryptocurrency service enjoyed growing demand. PayPal's total payments processed for 2020 approached $1 trillion.
Shares in PayPal (PYPL), up 109.8% over the past year, rose 5.12% in non-trading hours after the company released a better-than-expected report for the fourth holiday quarter of 2020 on Wednesday than analysts had expected.
PayPal, the largest digital money transfer platform, has been one of the beneficiaries of the consumer shift to online shopping and digital transactions.
Amid expectations of an economic recovery in 2021, PayPal is forecasting annual revenue of around $25.5 billion, well above analysts' average forecasts of $21.4 billion. In addition, PayPal expects its platform to add around 50 million new active users this year.
PayPal CEO Daniel Schulman said: "Today, the vast majority of consumers say they will continue to actively shop online after the pandemic because it is more convenient, easier and saves time".
PayPal Q4 report
Earnings per share rose 26% to $1.08, $0.08 more than analysts estimate of $1.
Revenue rose 23% to $6.12bn, also above the $6.09bn estimate.
The company also said it added 16 million new active users in the fourth quarter, up 24% from the same quarter in 2019. This brings PayPal's total number of active users to 377 million.
PayPal said that 2020 was a record year for payments processed, with total payments up 30% (compared to 2019) to $936 billion.
Venmo, PayPal's service, processed 60% more payments in the quarter.
In comments on the report, PayPal executives said they saw significant demand for their cryptocurrency service, which launched at the end of November. PayPal Cryptocurrency allows customers to buy, sell and store cryptocurrencies such as Bitcoin, Ethereum and Litecoin.
PayPal's predictions
For Q1 2021, PayPal expects: revenue growth of around 26%-28% and earnings per share growth of around 50%.
For the full year 2021, PayPal forecasts revenue to grow by around 17%-19% and earnings per share by 17%.
Persons1 and Companies2 in the news
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SCHULMAN Daniel
President and CEO of PayPal
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