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Dec 31, 2020
PayPal Q4 2020 Earnings Report
PayPal's Q4 2020 earnings demonstrated a record year with substantial growth in TPV, revenue, and active accounts.
Key Takeaways
PayPal reported a strong finish to 2020, marked by significant growth in total payment volume (TPV), revenue, and net new active accounts (NNAs). The company's GAAP EPS and non-GAAP EPS also saw substantial increases, reflecting a year of record performance driven by the accelerated digitization of businesses.
Total Payment Volume (TPV) reached $277 billion, a 39% increase, or 36% on an FX-neutral basis.
Revenue totaled $6.12 billion, reflecting a 23% growth on both a spot and FX-neutral basis.
GAAP EPS was reported at $1.32, a 208% increase, while non-GAAP EPS reached $1.08, up by 29%.
The company added 16.0 million Net New Active Accounts (NNAs).
PayPal
PayPal
PayPal Revenue by Geographic Location
Revenue by Geographic Location
United States Revenue
CapyFin.comInternational Revenue
CapyFin.com Forward Guidance
PayPal anticipates sustained momentum in 2021, projecting strong TPV growth and the addition of approximately 50 million net new active accounts (NNAs) to the platform.
Positive Outlook
- Expects TPV to grow in the high 20’s on a percentage basis for the year.
- Revenue expected to grow ~19% at current spot rates and ~17% on an FXN basis, to approximately ~$25.5 billion.
- GAAP EPS is expected to be ~$3.20, compared to $3.54 in FY’20.
- Non-GAAP EPS is expected to grow ~17%.
- ~50 million NNAs expected to be added to PayPal’s platform in FY’21.
Challenges Ahead
- GAAP EPS is expected to be ~$3.20, compared to $3.54 in FY’20, which benefitted from ~$1.24 in net gains on strategic investments.
- In the first quarter of 2020, GAAP EPS included a net unrealized loss of $0.07 on strategic investments, and an approximate $0.22 of negative impact from taxes primarily related to the acquisition of Honey.
- In the first quarter of 2020, GAAP and non-GAAP EPS included $0.17 of negative impact from increased credit loss reserves due to macroeconomic projections.
- Estimated non-GAAP amounts for the three months ending March 31, 2021 reflect adjustments of approximately $590 million, including estimated stock-based compensation expense and related payroll taxes of approximately $440 million.
- Estimated non-GAAP amounts for the twelve months ending December 31, 2021 reflect adjustments of approximately $2.17 billion, including estimated stock-based compensation expense and related payroll taxes of approximately $1.62 billion.
Revenue & Expenses
Visualization of income flow from segment revenue to net income