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Sep 30, 2023
PayPal Q3 2023 Earnings Report
Delivered solid third quarter performance with revenue and EPS ahead of expectations.
Key Takeaways
PayPal's Q3 2023 results showed solid performance with 8% revenue growth to $7.4 billion and non-GAAP EPS of $1.30, up 20% year-over-year. The company focused on disciplined expense management and capital allocation to drive profitable growth.
Total payment volume (TPV) reached $387.7 billion, a 15% increase, or 13% on an FX-neutral basis.
Net revenues grew by 8% to $7.4 billion, with a 9% increase on an FX-neutral basis.
GAAP operating income increased by 4% to $1.2 billion, while non-GAAP operating income rose by 8% to $1.6 billion.
GAAP EPS was $0.93, compared to $1.15 in Q3 2022; non-GAAP EPS was $1.30, up 20% from $1.08 in Q3 2022.
PayPal
PayPal
PayPal Revenue by Segment
PayPal Revenue by Geographic Location
Revenue by Segment
Transaction Revenue
CapyFin.comOther VAS Revenue
CapyFin.comRevenue by Geographic Location
United States Revenue
CapyFin.comInternational Revenue
CapyFin.com Forward Guidance
PayPal anticipates net revenue growth of ~6-7% for Q4 2023 on a spot basis and ~7-8% on an FXN basis. GAAP EPS is expected to be ~$1.20, with non-GAAP EPS projected to grow ~10% to ~$1.36. For FY 2023, GAAP EPS is now expected to be ~$3.75, and non-GAAP EPS is projected to grow ~21% to ~$4.98.
Positive Outlook
- Net revenues expected to grow ~6%-7% on a spot basis and ~7%-8% FXN for Q4 2023
- GAAP earnings per diluted share expected to be ~$1.20 for Q4 2023
- Non-GAAP earnings per diluted share expected to grow ~10% to $1.36 for Q4 2023
- GAAP earnings per diluted share now expected to be ~$3.75 for FY 2023
- Non-GAAP earnings per diluted share now expected to grow ~21% to ~$4.98 for FY 2023
Challenges Ahead
- Q3'23 includes a ~$0.8 billion negative impact from European buy now, pay later (BNPL) loans originated as held for sale (HFS).
- GAAP EPS includes a positive impact of ~$0.02 from PayPal’s strategic investment portfolio, compared to a positive impact of ~$0.34 in Q3'22
- GAAP operating margin of 15.7%, declining 59 basis points
- non-GAAP operating margin of 22.2%, declining 18 basis points
- 428 million total active accounts, compared to 432 million in Q3'22
Revenue & Expenses
Visualization of income flow from segment revenue to net income