PayPal to add 50m users in 2021; expects $25.5bn in annual revenue

PayPal said it was expecting an addition of about 50 million active users in 2021 and forecast annual revenue of about $25.5 billion, well above the $21.4 billion estimated by analysts. Its shares were up 5% in trading after the bell.

During the busiest moments at the height of the holiday shopping season, PayPal was processing over 1,000 transactions a second, Schulman told MarketWatch, a record statistic for the company.

The company’s total payment volume (TPV), or the value of transactions made across the platform, rose to $277 billion from $199.4 billion, while analysts were calling for $267.9 billion. Venmo’s TPV rose 60% to $47 billion, whereas the FactSet consensus was for $46.6 billion.

“At the beginning of the pandemic, consumers amid lockdown had no choice but to do all of their shopping online,” Chief Executive Officer Dan Schulman said.

“Today, the vast majority of consumers state that post pandemic, they will continue to shop online at their current elevated levels because it is more convenient, easier and saves time,” Schulman added.

Online payments have got a boost since the start of the pandemic as people stuck indoors rely on mobile apps for shopping and paying bills.

San Jose, California-based PayPal said 2020 was its strongest ever annual performance as it processed a record $936 billion in payments.

US holiday sales jumped 8.3 per cent last year to record their best growth in at least 19 years, the National Retail Federation said last month.

PayPal’s processed payments in the latest quarter rose 39 per cent to $277.1 billion, with an additional 16 million net new active customers.

Venmo, PayPal’s service that allows individuals in the United States to send each other money through an app, processed 60 per cent more in payments in the quarter.

Quarterly revenue rose about 23 per cent to $6.12 billion, topping estimates.

The company reported adjusted earnings of $1.08 per share in the fourth quarter ended Dec. 31, higher than analysts’ average estimate of $1 per share, according to Refinitiv IBES.

Schulman said PayPal saw an exceptional response for its new cryptocurrency offering.