PayPal (PYPL) 6 May 212021 Q1 Earnings call transcript

Good afternoon. My name is Gabriel, and I will be your conference operator today. At this time, I'd like to welcome everyone to PayPal Holdings Earnings Conference Call for the Fourth Quarter and Full Year 2020. (sic) [First Quarter 2021] [Operator Instructions] I would now like to introduce your host for today's call, Ms. Gabrielle Rabinovitch, Vice President, Corporate Finance and Investor Relations. ahead. go Please

Good Welcome Gabriel. first thank for you XXXX. Thank PayPal's afternoon, earnings us. to the conference joining you, and call quarter for

Joining presentation Officer and Schulman, Global Customer are and the providing Rainey, our EVP, me a commentary. We're and slide John Financial President accompany CEO; Dan Chief our Operations. today on to our call This our on our is the refer non-GAAP presentation are discussing available both website. will being of and section And the performance, webcast. also Relations to conference measures. call Investor we company's In call some

current reconciliation for these make forecasts comparable will year accompanying the involve and the guidance find can uncertainties. and most the XXXX. full conference the this measures forward-looking directly statements You statements assumptions measures presentation expectations, in include and of our our risks second non-GAAP that Management to These and are call. quarter GAAP on based

differ actual materially from may statements. these Our results

find our our and You on and can risks, Form of that quarterly on annual the and the report section in XX-Q Form available most results could Relations Investor report XX-K SEC on uncertainties recent factors other with our filed website. more information about affect

Dan. any forward-looking that, let presentation me You should place May update information. With All expressly to this to undue reliance as disclaim information turn in We not call this of XXXX. statements. on is X, date, today's any over obligation the

with for revenue, and joining pleased completed and for Consequently, consumers both PayPal's heels and active become essential for results. we just thanks, record our today. EPS, have history, an everyone, the in ever of across I'm embraced that say has TPV and the world operating new PayPal strongest accounts. Gabrielle, share Thanks, raising year net targets the are on quarter economy, annual merchants. clearly digital to financial platform our Customers pleased strongest and us I'm to the that we

services its shift consumers. recovery, world see merchants begins for continue As to demand of attention both to strong we of post-pandemic and towards much the from set our a comprehensive a

our the Over merchant innovation accelerate our will the coming of year, digital wallet we digital rapid and engagement commerce customers' platform. through

continues Our essentially off-line full driven into the by We post-COVID and unchanged we believe payments a are experience. and become steps proactive seamless secular have significantly to digital accelerating trends addressable taking lives in market behavior commerce in digital shift their expanded online that expand remain will to a and world. Consumers platform. consumer a the

and mission are future Our paradigm products economy, our of important. a fully this to in where been digital everyone shape can has an the participate digital essential enabler never more new

QX are and across trends were by a favorable board ago. further comps strong the from Our accelerated year

grew $XXX now by approximately total X% an X.X% and our on eBay year-end. XX% expect volume, we basis XX% of Our billion. basis of or volumes on a TPV to TPV FXN spot their represents to be by

FXN eBay, by a volumes Excluding basis on XX% high of and all-time MS an an XX% on our grew basis. spot

active our for accounts, XX% to across per between be exceed Honey, the were XXX to increased Normalizing grew prior have from QX to XX% expectations the million, our pleased quarter, accelerate accounts, active transactions begin our billion, see to million with added XX to active million last TPA expect particularly for million the approximately million due XX we our our engagement the quarter. of of transactions We active will new previous up I'm from our record account X.X $X.XXX migration merchants portfolio. ending new NNAs to XX XX merchant year-over-year. the And billion generated growing their XX.X believe year-end. approximately on Our they eBay continuing a and pace now heightened year, quarters, year-over-year end on complete we we XX% now FXN revenues accounts substantially X.X up We By QX, million declined manage platform. an accounts. X.X% added to by quarter net expect quarter We in million million and XX% by will XXX in growing the XX%, revenue QX, we spot payments XX.X. and of basis. year-over-year. in

launched On of back performance and XX%. hold $XX.X QX customers EPS growth, cryptocurrencies. for XX% to TPV, of the its $X.XX, buy, the with up strong revenue strong non-GAAP this we Venmo We billion QX up continued year-over-year. of in in delivered recently sell ability Venmo

and with quarter. We are our experience Pay new heavily which Venmo accounts and payments. with businesses casual transactions. for this Venmo small sellers, initial expectations have business over currently in also card $XXX,XXX alone. small established, We for it investing Venmo's to Venmo beginning in including the outpacing both credit accept commerce The include making customer upgrading rollout rapidly now profiles easier capabilities, QX And XXX,XXX we're is

accelerate, target. our we revenue confident and million TPV in Venmo revenue to continued Our remain $XXX and Commerce growth

roll in app We next-generation digital QX. users personalized money make most lives will our be the all-in-one their of strengthen will day. every expect and an to It financial to wallet out empower our that their

XX% when during Merchants brand of we grow used same survey time turn increasingly their platform as shopping, XX% the provide X% overall a super financial clearly to to a XX%. consumers spend who platform. up shopping small add PayPal buying And completion other PayPal versus businesses more goes are U.S. XX% who it substantial merchants, That small comes cross-border repeat are saw Their the market the plays Across accepted. when outside online as average the by facts support XXX,XXX strength revenues in businesses other in neighborhood, as services have over and finally, businesses journey, addressable Small will And are digital essential Consumers These PayPal pandemic that from transition globe at numbers are to of across customers. sales enable and PayPal promise by our payments the in their consumers businesses to research of external consumers to reported XX% their buyers. now our the their often Nielsen, continue merchants expanding And to merchants as sales trusted X% negative versus to world. clearly XX% an their who PayPal that all of PayPal turning recent lift. a for of brands record our selected an our to experienced use all in with customized the PayPal app. who the local more capabilities the Small to a they most second period. more is small retailers peak checkout merchants. last PayPal brand into and for unique see According PayPal use more year XX% less by than we PayPal economy. We drove experiences of businesses. into trust powerful market. more choosing PayPal PayPal used loyal

Pay in For to alone. show instance, In transactions launch, our strength. results from and Later Now, to engagement from to a lift the continue significant U.S. $X TPV our Early time product strength continues XX% in we've short move billion over the Buy TPV. in processed

implemented on and merchant Venmo a X our now pages our have strong, and overall signing their up nearly of in our Now, checkout. Demand lift remains with enterprise in-store with with nearly QR codes capabilities corresponding have seconds. merchants. merchants PayPal QR Buy across accepting additional product every addition, an share codes XX,XXX In continued Pay XX our We million momentum large payments merchants our Later upstream for

spending are QRC of XX% on PayPal adopters early the platform. Our more TPV

QX. Our overall QR across equaled $X.X in efforts in-store and billion cards

during I can Investor the play digital the more our a system. Both financial recovery shaping a technological of be system underpinnings and years. central cryptocurrencies a current upgraded critical over role currencies will financial and equitable inclusive we As discussed more our believe Day, bank-issued substantially in coming

acquisition has currency all central conversations leadership the forms numerous government to and world. that we regulators pleased embraced, that technology also and bolster enabling Curv positive low-cost Our is financial to Curv's And our banks, a our new with in infrastructure share last around will team month. been widely inclusive. of our efforts officials efficient, and I'm shape talented existing resources accelerate digital closed

in Alibaba's partnership innovation This across of an global extensive pursued shop will of frameworks. and Alibaba. ahead our global local, and millions Alibaba regulatory sites operating an as and hundreds to with Express, We on have is its retail governments national be as in marketplace now with agreement well launch PayPal wholesale agreement China extensive global of compliance us, of expiration our us a of road The enable map marketplace. method consumers payment with to partnership China. available enabled with will has as Ali in outside eBay

partnership. pace and the at the potential ramp ultimate of new our are We current this excited of

the the to businesses consumers with of collaborated order payments agreement Middle in Africa across to clearly as and significantly in QX. more with online. access East, also globe. accept commercial the a PayPal We our and growing Additionally, we have serve marketplaces our for to exit momentum FlutterWave merchants receive enables to These to broaden shopping In efforts into allowing customers tap online. across UAE rapidly have lot reach we make TelR PayPal significantly this quarter, in

We to product will the year. continue new accelerate throughout innovation

our to continue for to addressable work hard reflect and market Their continue digital. me to drives continue us with capitalizing on our market leadership expectations conviction to to increase share stakeholders. increased for XXXX by who let grow and John. employees that, our the customers. to like And our work shift all our will of behalf on our accelerating of call deliver Our thank over we that to the tirelessly positions value turn I'd

for revenue from on growth looking year meaningful March teams pre-pandemic. exiting That the impact. have the when very thanking are last to built deliver collaboration results. In operational and softer most marked quarter. start us business quarter, rates earnings want our Thanks, than challenges the the Notwithstanding In to And guidance faced, said, our helping deliver is a I strong QX, the COVID Dan. off of to to benefit pandemic. comparison our structurally year. We this year-over-year our for negative for momentum at on the faster and COVID-XX both us we a into we're the and financial execution that and result, a allowing results our customers, year growing at XXXX. our to X we culture our outstanding recently employees start raising year. outperformed partners and great rates as focus an We're by absorbed on

This QX Before XX% the I'd outlook, our basis. we've highlight Total our like grew volume updated and currency-neutral XX% payment reported. strongest is ever discussing spot to a on results. growth quarterly at

X% grew grew QX, Transaction quarter increased strong and XX% momentum a XXX our typically Revenue last accelerating currency-neutral. eBay basis spot XX%, $X.X from Versus basis of of grew these to volume points And growth. revenue last Strong billion, growth our XX a year, volumes experience sequentially. basis. XX% compound points of on TPV a X% X.X% while neutral record XX% this XX representing XX% acceleration billion. drove basis grew sequential across QX QX, our annual QX from Braintree quarter-over-quarter. the and acceleration contributed volume, to down X core from to services reflecting Venmo in PayPal, volume basis declined at QX rate and QX and we by currency in points of sequentially points performance decline Our from and volume user year results. X-year on spot a the $X XX% in year. down year, last In represented merchant first on marketplaces eBay same Notably,

to customer revenue volumes spot X/X the Nearly XX%, a on diversified was was point $X.X value-added was partially services grew the performance, take These factors hedges, which X-sided growth in effect of XX mix international basis services credit and Other million. ongoing strength revenue of results million transaction rate indicative on this other expenses neutral from our bill transaction were grew income increased X% history. expense $XXX to XX the revenue lower our $XXX from payment growth. X% balances. was billion total foreign take XX% X.XX%, resulted eBay. the rate point only total on contributed of interest transaction basis Volume-based as and decline. and the in of resulted also offset driven in as to quarter, A revenue accelerating value-added strengthening these well decline These currency first strongest revenue. by performance eBay, in currency take transaction volumes by X% rate Venmo reduction basis growth from of In rate The lower take in Excluding platform. decline X.XX%. in

margin reached provisioning margin XX.X%. credit last dollars year, loss the transaction result, grew dollars grew XX% for transaction margin As in a and XX%. transaction quarter, the macroeconomic-related first Normalizing

XX as expense to driven a points, a expense into rate of by basis volume basis XX improved Transaction mix. highlights. record and TPV the Going funding of points low both

mitigation Continued to provisioning overall. X decisioning In risk our rate provide complexity low quarter, losses the for increased record comparison. credit improving XX strategies improvements in year-over-year resulted transaction the additional another of and basis basis the want our to in last discussing in given I losses points year and context points the

a expected the macroeconomic negative this deterioration reminder, credit impact. $XXX in After $X.XX QX in by per XXXX, As environment. share increased for reserves the losses to we represented due taxes, million a

at reserve we the XXXX, XX%. During ended and increased our year coverage ratio

These quarter of end year merchant XXXX, offset credit strong consumer This More first with first trends balance $X.X gross our release a the of favorable the by receivables. repayment activity $X.X decline quarter approximately This from continued portfolio. portfolio. of QX. and loan in provided and growth to in partial benefited receivables and our lower economic in underwriting billion EPS. the balances addition, benefit approximate $XX performance XXXX. in conditions in contributed partially billion losses ended an release In the of $X.X portfolio resulted to to $X.XX our was in at reserves at and quarter Tightened reserve declined by last million we billion the end

expenses ratio increased our result, XX% In declined and year. the essentially the flat quarter, XX% revenue, operating of a reserve of remaining the represented at nontransaction-related first As to last XX%. to end coverage quarter,

a from are expanded performance last XX% growth. and $X.XX income to to basis, any inclusive marketing XXX continuing the In Normalizing And our basis non-GAAP $X.XX macro-related initiatives, our our relative by first was and operating incremental was year. driven other We of revenue approximately effective This from only we're prioritizing grew provisioning offset advance basis our lower every strongest margin EPS On Non-GAAP last income rates elevated generated. operating investment sales and interest our and billion, interest $XX in and and expense rate. non-GAAP in by spend, declined income we for The was largely the more margin key by higher debt from and QX, operating a million an to reduced income was invest dollar on of earned development. last issuance of for on impact quarter. interest decline lower technology income income additional tax for negative year, normalized May. points. XX.X%, operating this operating other

investments still grew For credit to negative normalizing XX%. the the billion. quarter impact non-GAAP cash, non-GAAP $X.XX EPS equivalents first Again, quarter, for the $X.XX. ended year increased with last EPS grew cash $XX.X provisioning, We related and of XX% to

addition, from In generated we year. growth last free in quarter $X.XX flow, representing billion cash XX% first the

revenue first flow. generated in free of we For every dollar the cash $X.XX of quarter,

our of quarter. scale This outlook for our and guidance XXXX increasing to strength well at profitability underlying for the guidance the like accelerate as our at ability updated to of reflects business. updated growth core rates our I'd Now as discuss second

improving for this allowed end of first XXXX, in greater compressed our payments accelerated, $XX.XX the impact. our For more a on the We sustained our revenue now a expectations, and active quarter. for year in timing to be a prior credit full to business spot and puts a and pressure near-term be Merchant are the performance quarter to for and earnings than us percentage Broad-based new based of momentum, growth. This has XXXX. by managed Services third revenue outlook. cleaner expect basis expect to eBay's XX% our performance At year. billion more we approximately time, of raising our on offset earnings now same growth this exit we Relative complete and transition more acceleration TPV net record the migration revenue allows strength approximately on the the

expectations We from raising X while of the point time same at absorbing pressure our additional by growth growth to for X are eBay. an revenue revenue points

of approximately year. XXX at this start we had points In to basis we margin generate operating margin the to guided more year the expansion relative addition, expansion modest the expect of

adoption expect earnings position representing and of strong our approximately of XX%. seeing at products of growth a the an XXXX. result, share approximately growth we services. start from of and the non-GAAP to now $X.XX, to we of this points is per the a new executing As be provided X guidance Relative non-GAAP earnings year, strength We're additional in

wallet are innovation, engagement. stronger business deliver offset Our headwinds trends further to our outperformance strong incremental more and underlying the previously in updated drive investment and us we these to increased guidance expected. in adoption pronounced than digital to our and The investments includes initiatives earnings allowing growth eBay QX

$X.XX quarter, revenue we XX% spot. For representing growth second of the approximately billion, expect approximately at

we expect addition, representing approximately of In share QX X%. approximately to for non-GAAP earnings growth per $X.XX, be

EPS. of year. reminder, a added XX to and basis and new increase year, in an margin Based million expect Favorable our to XX from top with 'XX underspend 'XX, volume and this add strong a resulted growth. contributed second points the earnings active mix net XX% XX.X we in compound year annual on more million in in last did our to a new expenses, quarter. COVID-related last more dynamics, raising non-GAAP growth our On outlook. reflects trends, XXX discuss the new year, for operating the tougher funding year. We're the users performance nontransaction-related the million current than year between at users the range in is current expanded margin to and XX XXXX, comparison. accounts. XXXX updated actives basis, active As in the combined. net This approximately users pace, we I'd This and combined that million add than our 'XX also additional growth and last net record new we new year our XX% On like QX guidance now this guidance creates guided accounts net of million to last we'll start XX X-year

year, As million lapping a growth. reminder, in now added we this are QX accounts and XX.X last

worth our comp, stronger. be couple net QX our the of expect QX to the ramp actives new business lower than adds be this we and our for guidance Given It's to QX a and year, QX of overall. and related points tougher and throughout noting to initiatives sequentially

environment year of and operating, are stable we a First, in return is very a Travel in which are more physical to In to dynamic continues vaccinated. while resuming. predict the challenging markets, There's threshold times. getting some degree of than normalcy. a we're than the on normal to be ago, our experiences. to core return of many more People

is demand the certainly this resulted COVID-XX of last from the year. Some pent-up that void over from

reversion to certainty a For the perhaps next to on normal may pace in the X be the which and quarter This some, times. my to the we predict on me that degree this of things trends level from business and have to unassailable. our is way to prior brings it XXXX. change with same challenging is were of impact The second point, its

behavior has in payment this that and of from experiences. will namely, Our growth acceleration the the e-commerce in continue importantly, benefit growing trend penetration resulted business ubiquity the have of consumer the continuing pandemic, digital from the and of to changes

forecasting growth our absolute same the markets margin and investing in continued our aggressively We performance well said, realize and and drive be help that operator have a To efficiencies, to our in the trends long-term to both trends time, and to secular reopen. world cash to said, and our platform. underscore We're history additional our extended turn payments accelerated see are begun positioned of beneficiary continuing as support enables some relative scaled, our normal. countries enduring over heavily our strength, across first digital shape position than secular of generation. our basis. diversification global to above We scale to is it variability these relevance At delivered significant results capture trends wrap elevated outcome. levels, even up, and free in the to post-pandemic business I'll that, strong And to best two-sided We're continue leadership on to the pre-pandemic meaningful repeatedly opportunity reflect a an business we've e-commerce of ongoing momentum. in for That susceptible significant the With questions. this short-term and operating quarter spending us the and expand invest ahead. flow more

Instructions] question comes Darrin Peller Your Research. from [Operator Wolfe of first

NNAs, When a at of coming thought results Great million number, that. XX record was year's you're we good we out here. and now last look raising

on you're And just kinds market, could we maybe or seeing reopening driving especially the record the really other on, you you just the for actives, the new is you driving net the today what's through as users mentioned just churn coming force the then of upside confidence? as And on touch these even dynamics kinds can If incremental side activity funnel, partnerships around in that even the on of the talk levels? like big what's the Or and you go could into Alibaba if rates? international? it other after world the the touch of reopens,

onetime year Darrin, quarter in a and has see new adds customers anything. I seconds drivers, every from XXX brought XXX% the to And it. here, throughout network a with view up million supplement up being every then now, on start QX. our million a was with But core million in answer that a the PayPal's, on John we think of the net on lot had ago. that, still Ended predominantly right X.X QX, say strong I here. of Darrin, maybe That merchant aggressive It's Venmo. XX new million, brought to merchants. second getting think the X.X look, XX% predominantly to We new is the still wants last We that merchants, in seeing think quarter. ex between my if effect new opportunity the a We're scale I We too markets, have I yet brought without year. accounts. somewhere we really from throughout it's I'll a great Honey huge quarter. on X active actives growth over We X had

of expansion lot a markets. have into international We

I marketing results. excellent deliver think our beginning to programs really are

the just And substantially. X%. when going there. we're by think think inside I TPA what's are surface I about of our levels mean, the kind I on scratching you up base, going our grow engagement saw

our in on months then in bunch you the TPA for used you If NNAs that be coming TPA, users quarter. their talked million normalize the put on maybe of just the a went active you up of we Honey, TPA, on. for the normalize when $XX amounts they And about, NNAs, we result TPA X% daily say because quarter them put our and do to amount amounts But when of and had to XX% if do really that don't to count John came have full of X.X huge by you but is that on the doing, talked just Because year this that full huge huge transactions, they a quarter. normalize in that to grew John NNAs and about. if that you

to about. later will used a And But examples. XX% have new things fun of who products the active Buy Now, levels. repeated engagement X because give Pay have within have talk I'm the base, Our talk Now, QX services XX% across sure but lot months. have now users huge somebody of are Later, couple Buy XX% you in X daily we months. about driving our of and Pay I'll a Later right were within customers up just repeated it

in-store look incremental it's day. of now, our holding they're about And open About at crypto every their true. users this XXX half transactions. last we incremental you app cohort our an and call, to driving XX If talked single

good the bottom the to beginning of into is both that see narrowing -- trends. clearly and of one out, potential of bullish those for our I'd was the top I was to QX down, new one quarter be the net we of XX.X the is that Even rates really thing are always our year actives last of on really lowest at churn best million because incremental at funnel, actually is funnel cohorts the going though the of a the which and it year. we the pressure I'm year. Darrin, for quarter of we're cadence NNA QX go us. ever think the then QX. is increasing the bottom for point we so the NNAs And important the through NNAs. see puts of And funnel top the funnel, increases really The why as did solid activated, we amounts

in hopefully, of really the to strong on that front, strong So on the really And come. NNA general, engagement front. more

engaging Because customers all toughest time, comp be going to back us these quarter that the a new now we're number. they're you actives from using quickly, mean mean, they I -- an think in our -- about real the enormous And candidly that second make just in came you everybody, we add that net Like and record to a perspective. new I'll That of think or sort Yes. "Okay, surprised right? I of we've Darrin. back like, this if to was quarter, got quarters that that amount can. ways then when that year ago, saw the we ago I going sure the to go second well, it a year active even point was year what?" ago, probably in And maybe knew net you X

said, there's Dan made we've the as in Even churn, still despite reducing pressure there. improvements a of lot

point thing XQ that expect of acceleration in our physical seen. what to time, continuing trends. been engaged most to They related that you expect and that we XQ there. of we've sort going us. that for period And to the might is people cohorts say those for and then consistently the a I the waned have we've but QX will of ever sort returning so world. gives talked these see like And us for confidence this haven't the low about said year And we're strengthening be to see we've to this, But

around gives And it conviction what this us so and the our rest raising that really as of well. business for the bodes

Our with from Huang JP will come Morgan. question Tien-Tsin next

results on ask impressive quarter Really many wanted fronts. I first on to revenue. the

your So guidance, points. by beat X like, revenue you looks percentage

few that's think margin seen in a we've upside quarters. the widest I of

I'm upside? could outlook eBay like Can how So if the your to bigger change us for What it surprised you? for surprised but for what It rank us curious, you you what revenue the it maybe. offset year? it enough rank drove love sounds the it's does you? would And drag,

Tien-Tsin, you to want Dan? do Yes. start to me --

Yes.

that migration So full think you're headwinds allowed seeing right. seeing to performed To question QX, The to we're actually the handful momentum in with Starting things more overcome us has the managed there's really on payments. the your that, a business January. accelerated with its expected. I we're of differently what a from eBay think, starting specifically address year, for I than that we

between stimulus of what than quickly don't forecast. to that, the getting On So resumption holiday of of the some e-commerce saw in our And other happened couple normal. January, had effect sort overstate March, activity there -- extended weeks of you've stronger want travel estimated. stimulus. we had than was first we than Like we to quicker an in book that sort of shopping of I And got the end, then we period. in a assumed much because the that more saw

just to about pretty And fundamentally, that But is replacing think was think the a of time at and displacement seeing and back more what described we're are you maybe more more are you're shift it that, if point more call that experiences cash. has think that happen. transitory, these I clear step what think that I going was cash. digital been in around, I seeing permanent that things you I it,

So a not eyes get and physical I'll is code put to give to silly had world is I'm They're front last the right in me through it you restaurant happening night, experience to went now. my to when a time waiter card And And our this the happening transformation gets a And That's off QR that's sitting I that run one out them sort digitally. credit the dinner. I'm inside. receipt Tien-Tsin, it on handing example, printing for of it with but right the there. reopened, of my right for Saturday check, machine.

threshold the it's that's it's is there's where small our example and really online business. fundamentally, -- of benefiting think good convergence business, it's I what And of think on this but are a in off-line We our seeing I kind that anecdote, of we're this. a of

are opening. to even is I'll because that, the markets just strength seeing think that on add that John, I we're in that

of is because did now digital that to If now for in-store that's well, XXX-point we had you raise used And what raise from eBay. we and we're life. core our world digital X.X you people like world. effect, us about, really, XXX be physical in the seeing a incremental just pressure e-commerce between distinction XX-point the online are there living what as guidance is And on for separate X think it's business. points years And or in a revenues, a was world. seeing That's ago year, a a in and

more economies example. about and it, open, would digital. more be of to those as good payments Even moving are a like Uber Think

they're rides payments. start through digital there, but moving more environment, platform into and more it's As a done all a physical digital and

see cash sustaining mentioned I And networks that done the forward. or There's less moving to XX% it by the And to And so a going moves digital, are said way, is to going and and cash debit, week funding use something major growing is of which from PXP. it's that. X also ago obviously replaced. digital. that as and think digital just It's perspective a being forms moving of that's predominantly study one a it's of clearly, to on moving moving to XX% between trend when definitely that frequently, John by anywhere we to payment, is to great consumers a

with X-punch a that a economy. kind us QR we to or now, codes in what's that happening of think Zettle what's world Braintree happening or our extent just this depth whether And digital the more now any portfolio that's world the think I of of it really understood in products. I transition complements so And the services online have or of physical the traditional the of or right be X-, don't

And just thing. if I one can more add

of important. we no investing these For why those time heavily reasons on the right clearly are. as points public to we guidance more bias. tailwinds, as in terms as our company, still entirety And think that us, think right we're why guidance we really secular invested in we Dan not important and we do XXX year. for that of we a able fortunately as that's At point us that that heavily terms because in our through it's mentioned, the it's to margin And of in as and X now, EPS now also our operating rolling are to our have years because see we basis it's capitalize our for are want expanding invest you is while

will from from Ellis MoffetNathanson. question come Your next Lisa

to had globally. and comments, your currencies follow-up their drive on on potentially ability I inclusion a Dan, digital financial

the with As what are the around CBDCs, PayPal we think experimenting they or should your could more specifically, with could see thinking And how you're roles how impact are how CBDCs private the plain? about of broadly, Meaning, role that engaging you business? sector? governments role world about

Yes.

of the of of the in of those in about quite had very of we've concerns it players a here any is have, specifics with have conversations a of in the the platform have different to some one that we've future a isn't And digitized But forms in, going one or different really government. going we CBDCs regulatory I think key our each a each on the it. in speeds. of of with the conversation currency. at envisioning governments, conversations Fiat based the capabilities which other, might that the won't that I what that U.S. us leaders benefits and across where banks various I is don't to of of some oversight be that bodies isn't So number would much regulatory and obviously there engaged of understanding a believe go could that of We're one country I is from talk world What some world they're around kind could what of some the conversations central is have in do learning all issued. country that of how say my them. each PayPal the had like

lot I that of synergy the utility a next-generation a money. can think, technology lot can to elimination of as and perhaps access intermediaries the with that cost, take wallets. you speed which payments, certainly in down add there's digital think about things unnecessary of time their interesting can obviously, There's can somebody

been managing tactically within efforts So financial expectations well of the going a towards? whole how on think that we've our moving think openness And around We're got ways the investing that, blockchain of start shaper my be can in and through of banks reactor a of we're -- right those. and conversations new is in to this about But a have to excited PayPal money with a to we great to about happening. cryptocurrency have and now. going gone that's to And governments idea -- central how tremendous amount business the move establishing that system. digital currency those. a leader beyond and really terms what And not system those results unit is about of inside

Pretty exciting.

actually, is It yes.

will question from come Next KBW. Sanjay Sakhrani of

trends year. trends affecting question far volume PayPal it's mix overall observed, like with and ecosystem? just engagement mix, And thus reopening seen you a had discernible that might this have on funding how I the the any

I'll start want Sanjay. may add and a there to Dan little Sure, bit.

there a I there's that number of things we're think observing.

Later, stands broad funding more your products, of quarter, up but debit, of that something Now, versus certainly most and in see previous is about the funded was question like the good that's think in out. credit, example to our debit. I debit a even portfolio We shift on building that That XX% XX% Pay a quarter. recent around in towards that's with where across moved Buy

seeing earlier is of answer, so we back And cash. there. believe some we're of And the going displacement a that again, clearly, shift an to

single the of verticals of where around growth anticipated. than verticals we in one what terms travel out, certainly, of overall In reopening, volume in rates, happened and and incidentally, year-over-year the terms groceries, that of a up. is overall terms still growth had of we're largest And you've seen of highest earlier markets picked food even Among us. kind still bit for reopening. sort little the has seeing back that But in that trends fashion stand some

really in just world telling now. consumers -- supports So for surveys the it again, XX been months what it have

Now seeing behaviors. it we're in

call a seeing. here and a lot experiences And the into in omni world that convergence to sort of so we're that again, these the those be But this your about talking customers. online have need of physical themes I this of we're plays will things the for terms and would of that out couple of

will Your from next come question Colin Baird. of Sebastian

impacting of feeling just could you enhancements that the feedback that, pipeline how you crypto app the business us to Venmo? related other profiles target year. at this if to remind on revenue sequence original you're about business? have will how and How course for are if over And full And the any integration year point the people how are using the of

sure. Yes,

XX%. in well. start the quarter. up great other annualized of to you Venmo if really It's as look for first I on of our Think interesting the $XXX of and Venmo really that So now, another One on million, public, back strong we is all, at billion it $XXX a right thing John $XXX about TPV, went had was when the were off year day, QX billion. TPV. TPV call remarking TPV

opportunity there inside we monetization another when basically And went public So such year PayPal PayPal a huge of is you on have that. ago.

or the we we the executing the that's end knew great great X% you And month, obviously, the beyond card, all but surface that happening you millennials, performing recently look to out team protection. at in things goods like above use end will profiles That's It as they're And That's It something way, Credit is what this the them with is transactions. a of million, be XX% experience, experience. is way. on going services the in majority Venmo, PayPal That of next May. there what our initiatives. launched that look of huge PXP and Venmo look ramp. when revenues our side. which and expectations, some a obviously, the X% consumer that base great plan. feel scratching ramped by be in is confident growing. to of the like be year's it's crypto growing a that I year by several will have XXX% their is be. revenue the is have at Crypto surveys Venmo very if just anticipate But very sign-ups, a you generator million. years Venmo this little be of out from you Pay same $XXX ramp. of huge $XXX think, the thing is Business going thing with new on on the but by to This introducing value X side. that Pay at happens now. come again going can went proposition to of We're

the in we're app front around, there's expansion super international more more Venmo financial is much digital down really excited move in and it. and going opportunity. to payments. same app wallet of services capabilities is and and It's again, just down. so going shopping itself, path putting out. has rolling to And basic super consumer become services a It going PayPal the eventually, so that And about And that

the I potential all on Venmo. bullish think we've of been

just We that that realized are and to we the large. is keep -- now beginning quite in think investing to see it want opportunity just because

ISI. Our David from next question Evercore of Togut come will

engaged broadly, most talk Good you Later of the year? Now, you overall? Can Now, to Pay customers. how your Now, engagement Pay Buy engage ecosystem Later to for customers More balance see for the the expect in this Later expectations Buy the growth PayPal Buy Pay strong from about

John then go and in. maybe can sure. I'll Yes, start,

value market. great the a in it's proposition all, of First

I sees their incremental easy, the by think trusted have It's part understands a take It's of to integration. Now, everybody merchant and PayPal brand. a Later. rate clearly no And cost for is just Pay that that. way, Buy

them. part they it, value now in million that have taking proposition. We customers no we problems know consumers have it, behaviors. we XXX So the see recognize platform, on because their know they And

and have Later less seeing We Now, what out are the approval than space. in rates Pay we Buy higher defaults

of Over have billion million Over TPV $X customers. give to billion front over unique you of been loans that. in a launch. since globally sense XX U.S. X $X Just the in of done, Over results million

Buy things merchants, we're more one We -- engaging hundreds every day. as seeing of I XXX,XXX of the upstream, over customers, great And single unique LE like that lift the there's because with debit, halo XX% per platform. there's have mentioned, increasing, Now, And in transaction. a in growing on a that's XX,XXX with with are and customers our Later is XX% of cost TPV debit's reduction Pay funding it

with So big it's and end all into the a leading great going year. and by of much conversations with of QX to going in the the Australia expand on proposition we're the for consumers, end of merchants, Europe by more uptick tons of merchants

those Thanks for metrics. great all

follow-up Just bottom impact Now Buy of the funnel on growth the Later. from quick of Pay a

in these again, X we've the Well, or of it's X bit so. or things because all a Yes. months last little launched early like

actives. given XX-month So look at we

size. the the for this this and scaling TPA well especially -- that engagement, at look quite repeat you scale if bodes pretty company reduction, a increased but now our probably that is given -- is So behavior meaningful for both churn even of and

of Keane will question next Your come Deutsche from Bank. Bryan

saw -- to operating to ask, of think on about and non-GAAP margins points. basis wanted I it's leverage, operating I the raise XXX the we impressive John,

even there? headwind operating more, about So and though the caused increasing investing just still margins. increase what you're confidence you're bigger a And is eBay in thinking

there's direction going positive a things in there. lot the of So

So I'd from details just like you. to get the

that, address to Bryan. Happy

a the scalability the year-over-year some an quarter. because of transaction whopping -- So that an think operating you it had we've to but XX have want and those, when platform, ago. capabilities was this in look the improvements like and that every know has to I a can basis talking number. items improvements drive we've a of a we're really imagine To level at stand been transaction to at That's And is of about out example. in or investment made I And again, internally, there's of made terms number of the record XX% don't the areas, to of can in I saw transaction think and capabilities look, are declines of there. hard operating start again, there P&L. both comps a quarter. going expense of tremendous. lows at We risk think transaction-related are that. our expenses different get expense in line margins we repeat in But that that On sustainable. you transaction incremental probably years particularly hope come our performance look, But about ago. points number of the And idea loss. our it's the take obviously couple one demonstrates we've so. the our pick expense, really quarters rate as losses I But X in I any part certainly -- would down the just X that you like definitely if couple that

at as we're bill same the now, a take carries more right related of Some lower rate. which to obviously like Well, a lower mix, carries an doing, it payment transaction that's time, example, expense.

about really XX% to between focused transaction approaching a And the quarter, a we're margin, pleased And on always have margin so that it. X. we've again, margin this

changes that it the we're be think again, that pre-pandemic. some to e-commerce, and expense have the going saw to which, There that around the from to from remain time? but basis we're levels transaction us what we business go platform. seeing pre-pandemic, XX It's of certainly points, think tough amazing this may don't see over so lower gives does that level points. we XX tell, pull inflation. at the expect all mix just is on where But out I And go obvious our does I forward up would of it we levels basis in question down leverage Does

back the will remarks. for closing I Dan call call last now to was today. That pass the question for the

for you you you just all today. soon thank of families well. I but hope not you and for of that to hopefully you of questions, as all all We to everybody, so you Thanks all of Thanks spent forward the with much. soon, your are speaking and us time and safe your seeing Yes. healthy. look

your you for So care again, time. thank and goodbye. Take