PayPal (PYPL) 2 Feb 222021 Q4 Earnings call transcript

Good afternoon. My name is Donna and I will be your conference operator for today. At this time, I would like to welcome everyone to PayPal Holdings’ Earnings Conference Call for the Fourth Quarter 2021. [Operator Instructions] Thank you. I would now like to introduce your host for today’s call, Ms. President, and Vice Relations. Senior Rabinovitch, Corporate Investor Finance Gabrielle Please go ahead.

quarter Good Donna. conference you fourth afternoon for you, call XXXX. joining the earnings thank PayPal’s and Thank to us. for of Welcome

CEO Customer on the Financial Dan President our Joining me and EVP, call Rainey, Global today John and Schulman, are our and Operations. Officer Chief

Relations the measures. This website. to on also being is We a presentation slide call company’s available our are discussing some are to and In conference presentation both performance, providing our refer call Investor accompany our commentary. will and webcast we non-GAAP

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

materially statements. differ may results from actual these Our

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

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

history. this want was our opportunities spend for of the everyone year. results, time thanks, and Today, face also in strongest am years one challenges to Gabrielle us. to we XXXX and PayPal’s the XXXX Thanks, I going but I joining highlight discussing

to again accounts history, active we account a X We X.X And particularly Overall, active EPS top surpassed XX% a cash be accounts. $XX.X all guidance that lapping top our of some and million also past transactions the basis year of as non-GAAP from anticipated. XXX of net $XXX Rising government also net and $X.X billion our did eBay business factors bookings grew We half share Ex-eBay, and transition. million incremental million volume. last $X.XX. the our being in the season quarters least, Even XX active $XXX of approximately hard In expectations $X.X Inflationary trillion revenue event our million adjusting our but annual lower with finalize line, strong spike put impact generated and stimulus I merchants. including on for XX%. and the year XX XXXX our growth well. to billion XXX annual the difficult was in transformation to impact QX alone, $X.XX to on put the forecast. market to grew forward for of were to migration added volumes year was It also first million new free And this we so, years, cut second of had year, than exit year. growth our payments of outsized and a growth, of chain XX% XX% $XXX results our billion Our eBay’s our despite QX we our active rates we impacted travel an are impacted eBay’s increase. QX. added Exogenous transition growth in than an million year despite total new and XX% full year ending holiday is going growth lapping in spending payments the we for core during speak managed a in by in rate last investment growth XXX year, look quarter. of elimination spot that almost came pressure strength issues flow. per a able in strongest pandemic growing within revenues in user driven within not the results. of certain payment transactions stop in during With for lockdowns we on said, XX%. of the QX. managed cross-border faster pressure users, grew history. a the by for our X-year and transition very to E-commerce up million our industry once XX as and our points. the TPV had letting revenue We billion pressures was happened by In with our And revenue Supply new disproportionately strong, to an line, base. basis eBay to reducing the trillion grew themselves. time $X our EBay’s the XXXX will variants and small accounts, of from the XX% segments record COVID merchants. threats

our Our been stable, have our has demonstrating remarkably growth been growth consistently again ex-eBay the underlying of platform. above year-over-two-year XX%. And strength rates

dissipating a to significantly a omni-channel back the commerce than the with of we digitize accelerating. pandemic, position clear continuing the entered world take cash I towards use move are to As and stronger reflect, step the we it’s when in

insights super tools between Our past physical merchants economy, years where customers. millions us to continue lines have disappearing. X And of across revealed vision for than essential payments, before. tens look them about financial platform relevant becoming provide a of The to ever the an new is services our to comprehensive more of our and shopping basic and consumer app commerce are financial navigate to virtual digital the

on and towards John business for their value drive in in driving pre-pandemic throughout pandemic as of the and new engagement behaviors our merchants Consequently, We growth EPS more our NNAs. same incremental have detail, current line impacts at shifting obviously Over Consumers grow seen more sales discuss key and expect margins are are evolve At emphasis drivers fully our year. more drive our the higher higher engaged the towards our and we with model. will while corresponding more growth they expectations and but to trend lines, will above our we accelerate revenue time, engagement the throughout we increase actives, with expect time, much ROI. still we net who levels.

an Our the appropriately environment. XXXX forecast the comps difficult given is and for macroeconomic half first in unpredictable measured

of are we focus secular At shift We the opportunities same numerous digital. to drive we business in and energy with is order XX%. are team non-GAAP EPS more can to what product and our that for revenues operating capture Last growing enable are inherent strong to in we increased including products to time, experience leverage over funding and more time Buy returns Now year underlying our win. anchor the year, We with post will to launched process to enter their fundamentals customers PayPal sources with acquired and the key on us than to new at consumers consumers And purchase control, The in other initiatives the and executing in-store go-to-market will Honey our QR Pay XXXX, our on own app we our reward going affordable. that pay and Happy emerging over terms, easier points. capabilities with new expanded shop like help help our into history. whether our the Returns discover or to integrated and brands. and checkout cryptocurrencies any We or codes, Later, deals make

will drive engagement. investments increasing these expect to continue We

and of and checkout XX% North experiences European our best-in-class are some history. Venmo focused XX% more including we intently more to Today, authorization at the easier investments, in top of our Through to highest retailers, it taking faster on American making the than or We PayPal rates retailers greater with top accept heights. U.S. the than of checkout even our are checkout.

more of shoppers share in leadership Paidy top market a to and checkout markets, retailers of Now, DoorDash, and Gap X Oracle we to payments engage among our Now, in Pay increase. available branded type Later are give agreements is Later to the salesforce. with we of Buy is expanded average including Buy grow Inc., in perfect or to Japan. investment Pay Adobe, example PayPal. Instacart, reasons making continue with signed quarter, with continuing Last new merchants with our We

to run-rate, with billion continue Now, billion with Buy year-over-year. consumer over QX adoption, $XX $X.X of rapid Later a We growth XXX% see Pay QX of alone, in TPV

had million the a up our $X.XX We solid processed XXXX, merchants XX Venmo fourth to have XX Pay with million globally the in launch, unique since than with million finish consumers X.X closed XX% services. of Later more billion revenue quarter, Buy out year-over-year. and year Now, loans and using

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of got lot of have us. we a work always, As ahead

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with financial billion in free and a generating sheet balance cash strong strength, of have anticipate tremendous $X XXXX. We we flow approximately

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performance. $X.X certainly back QX one it medium-term of TPV of and But want performance, along our our grew with our flow our free believe these are rates, in helping downs, billion actives on I free Thanks, XX%. our but strategy we to had an guidance. XXXX years And year. to period am performance for first, us by amazing will earnings the discuss contemplated out means in at and to today. net and to to more I our outlook And conservative our a more focus important XXXX. new that our record-breaking for Dan. we There in want both a customers, are partners off for outstanding to that going thanking we really I discuss and revenue generated overall prevent an like the from spend what cash was engagement grew revenue growth in XXXX looks several lastly, and employees I start objectives forward. I’d don’t flow. why its also earnings. in moment deliver a when cash achieving either steps want points year following items Revenue ups discuss that the going discussing XX%. taking and pivot us for

performance from XXX added we of excluding of than XX%, to with accelerated in more of XX basis more XX the ahead on transactions metric, customer XXX account, overall, revenue per TPV ex-eBay, our an Remarkably, our basis growth volumes XXXX, engagement industry ending growth And nearly and points XXXX, growth million grown XX%. approximately volumes also on percentage acceleration accelerated rates. points points We our XXXX. than And accounts, extraordinary have Since year consistently platform, well XXXX. XX% have doubled. XXX grew meaningfully million. to in growth accelerated eBay, top active

on increased largest We publicly pandemic, volumes to international And billion. products. in adoption total several of on digital represented By U.S., U.S. cash in of and share neutral decreased growth that our checkout. medium-term a quarter, Since nearly growth amount XXXX, greater digital was buttons broad-based XX% declined volumes ex-eBay the even a consumer fourth grew margin. checkout X shortages are Venmo, performance to and the sizable traded start confident leader merchant last $XXX quarter our Revenue This of times And of that And we revenue leadership XX% Relative than annually. opportunity PayPal are currency free grew revenue market chain ahead the an ever. is strong and than quarter Braintree, wallet. our fourth revenue a next handful in Ex-eBay, which quarter points. cross-border by our has of XX%, payment checkout points the that nearest revenue leads There of also of average, grew our generate credit we fees. exchange higher eBay, long-term volumes XXX X%. the XX% across do the core in our excluding we other transition only basis is any merchants year. companies acceptance more wallets basis. Further, volume impacted the the and foreign volumes position Supply our among are versus all measure, payments. is outlook. eBay’s the grew by advanced In and billion. to and Revenue adversely XX% XX% international of XX%. eBay in increased grew X% $X.X total the X.X% flow

by margin dollars our Credit as the performance history. $XXX increased total, end of $X.X rate driven XXXX. points of losses in basis expense Braintree instruments. volume volume-based a on quarter the fourth points, particularly the basis, was to strong. our increased remained XXXX losses improved neutral consistency our basis for Transaction our business. basis driven points Transaction the ratio equivalents last X of of in and point year, fourth to growth a quarter grew basis originations, billion a per underscoring Importantly, growth currency X of basis revenue the in compounded margin increases with points a Non-GAAP ended coverage mix, in in X-year the XX X rate margin grew were expense in In non-transaction-related relative At the rate XXX consistent $X.XX. quarter, performance basis quarter, take of points a credit loss we of our volumes points our quarter, And mix investments year to to XX% as the strength declined share cash, TPV which credit with seasonality, rate rate operating reserve and fourth rate Transaction XX.X%. of mix expenses quarter. approximately our and performance flat reserve pricing versus by as were other Notably, million released releases. basis X.XX%. an comparison the ex-eBay X-year $X basis, total approximately billion. X% rate In transaction reversing trend and and product was earnings We XX%. cash portfolio was matches last we’ve XXX X%. declined reserves the benefited the Transaction sequential QX was increased and reported basis X to and On take card mix point X.XX% to XX.X%. sequentially, and operating X funding In in declines. $XX.X best non-GAAP was to our year take both which Both of TPV income million performance.

the addition, cash I’d more and like XXXX. fourth stock provide quarter we now for expectations flow $X.X free new and In billion our net to repurchased billion discuss our in XX% context and increased of $X.X quarter. accounts in for performance our the to

came contributed an generating For discuss than slower actives million target. order our will our magnitude. I organic quarter, the basis. to factors There of three contemplated about new a are in this, the XX.X had which net on finish and below expected guidance increasing year that in We to

both supply growth. growth, the in lower by muted by consumer income driven spending the consumers chain well e-commerce as pullback First, challenges affected into for more year as

we and back quarter, Second, some incentive-led disqualified number. accounts acquisition our of of new on there the half impactful or quarter, active net from to changed campaigns. also in most customer that excluded certain the And were course including strategies, our we lastly the

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XX strategy, and to to this We expect are XX customer our accounts year. add engagement now we net million new and acquisition customer evolving million

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forward in back by on it impact the more XXXX we guidance with our of consistent adjusted on which extension, quarter. sentiment The strong inflationary degree metrics. year net revenue metrics high couple personal to impact a growth monthly of our have chain the of in The for we the December, our lack to quarter. financial of next the prices, reported has into we and expected believe the actives buoyed better the spending consumption, the and around allow last we assess the context expected. on preliminarily Overall, cohorts have decline about a had how holiday for the meaningful However, Over These correlation Omicron would retail combined and and and if was and sales having an outlook ARPU discuss pronounced and of than the our strategies we October results, platform quarter of to and lower most half will call, with end working. user this XX%. quarters, consumer for continued we on to unique addition disclosure inflationary to On full adopt our disclosure in engagement quarter’s of spending, initial the some shopping of in more is I’d incremental we with and financial stimulus the revenue plan to labor and November. impact you in issues the supplement quarter are was performance our now weaker consumer persistence had by new weaker indicated effects we performance seasonally expected, sequential came shortages, led month, quarter income this provided fourth a like pull to experienced in said cautious be This it, softer teens supply a that first us of business. is with outlook. pinpoint effect our active

with being We of have that an now, guidance be the the to likely lower the we but of growth the predict, not we end relative year end improvements of to to seeing range starting right be today, upper estimate we’re issues and of toward expectation could on these could environment result not XX% improve, continues range an range. incredible cause in Based of range. do our economy. conservative revenue the it the that of difficult to the immune in we it provides see are what to to Should toward for If XX%. vagaries our us best this business, The are stance more outcomes.

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approximately year-over-year and to is represented tax invest of year. settlements year. estimated time, XX% go-to-market Our totaled year. per $X.XX effective discrete same the XX% pressure compared of $X.XX tax our from rate essential. to for benefited This headwind this an to these earnings was in the aggregate, last resolutions In this innovation XX.X% rate XX-point earnings EPS is items, the At by the and share year, in growth factors strategies favorable and continuing to resulting

above last historical engineering, areas the our for which competitive This marketing X we’ve all $X focused leveraging in Over year, in spend nearly our like customer technology, to have and continuing digital years, returns investments we’re our innovate scale over strengthening and leadership at invested us. tremendous billion support, on of these while generated positioning and advancing payments.

we deliver predominantly our reserves. non-transaction-related leverage growth, expenses in Importantly, offset be our by in expense our changes will to XXXX, to solid expect volume-based which in related credit

we margin in QX XX% As as to to be deliver first And earnings in non-GAAP year. a last we’re year. of per operating In in we hardest for share. $X.XX up XX% XX% quarter, the our revenue against the we non-GAAP result, expect grew range EPS and to this year, $X.XX the expect comps,

last contribution year stronger eBay. from of stimulus, and half greater first confidence The from a benefited consumer

which For quarter, a to expect about decline $X.XX, we first the to from grow X% billion and $X.X EPS last XX% year. be approximately revenue non-GAAP represents to

we in ahead deliver in growth year the at As quarter accelerate. least top growth the medium-term through year, to growth or plan line and the revenue XX% at rate We revenue will line target. of our fourth exit a progress our

short-term to confidence trajectory the business said, performance, economy overall for our economic long-term, has has changed and our in relates for it our demand. when beyond out more In addition, to of consumer as over was medium-term while normalized underlying activity rise deviations outlook That we laid to expectations assumptions ago, our our X been year expected give and in expectation the steady-state nothing may predict the performance the difficult XXXX. a and

medium-term contemplate seen not simply a supply my inflation lifetime. at issues did Our in high not targets and XX-year chain

more to As previously we on a are we stance slower the year. off a start is XXXX conservative such, and now anticipated, taking than

factors pertains value of long-term it short-term financial the are diversity as believe when broad of to while best macroeconomic market insulated and of examine to And few as want that the market. $X.X with in flow we measure, as virtually We completely in our our continue years we are are the the grow had arguably it. with contemplated that even nothing growth metrics. billion in intrinsic even guidance. generating because growth in payments cash we I our and in reach cash these digital a But net not history our we’re of constantly achievable business. cash flow. earnings $XX medium-term almost our more companies a with maybe a engagement one very from close actives. outyears to objectives revenue evolving one new to period and in faster And well our There our free COVID. and any business, revenue you so than our and size our We of rates have with global are rates free By industry with will in of impacting continue do just our Eclipsing evolving, performance that generation. to is our and dynamic leader billion with Notably, thoughts. the are strategy

over We’re the to on things to Thank to customers we to that grow, can... to in it our operator we you. increase continue going to innovate, and turn leader digital value relevance continue focus can Operator, for a to I’ll and the global to questions. be control payments. create

the from [Operator Instructions] first Your comes question Huang JPMorgan. Tien-Tsin of line from

line is now Your open.

if NNAs to you wanted mind. much. on again, don’t the drill I in so thanks Hi,

I ARPU to of implied the and year million this gauge mid-term the what expanding as $XXX your in Thanks focus Just table? now instead suppose off so decision focusing to confidence and much. the trying the on drove growth on engagement here quality guidance in is the both Just that in NNAs?

with start context. start Dan Sure, to some I’ll want and I’ll in. Look, Tien-Tsin. might jump

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Pareto customers. of remarks, my where business noted of comes the volume our from I third majority there is in dynamic our in prepared our a As vast about

a instance, for go signs But appreciably. a to guidance pivot engaging when we than different with we’ve And out. a received encouraging see we, or engagement. provide laid in so is that – And initially some achieve need add what evolve to medium-term product different a service The separate for for that with there the and way think and we talked that customer, we’ve are us way. they have feedback ARPU we of those. we very importantly, about that increases a around customer our But

for medium-term but our it relates don’t it our appropriate our business, a mean in earnings cash that to revenue we think not And so and it’s outlook is strategy. this both We as have pivot and confidence does free in flow.

Maybe add I’ll of things response. just onto couple a John’s

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the like and revenues way. we and drive going And dollars to to we our efficient our so best in are our most the way really in earnings feel invest

bring going in of of conscientious his we’re choice outlook. subscribers we mentioned that, So won’t great remarks, on making. mean NNAs that just low-value And in. dollars shift doesn’t tens have we’re one a millions is means in as at coming marketing John that quarter. confidence to And medium-term is we not throw It that this that every the

Very your clear. thoughts. Appreciate

Yes.

you. Thank

the line Your next from question Darrin Wolfe Research. of comes Peller from

Your line is now open.

Hi, for your revenue just Can lower XX% as can thanks, months than XX% few know guys. is assumptions of you you to touch XX% guidance? obviously I the your on as ago. prior expected a of – the

year other also, just hear great touch of on might factors? need maybe about any perhaps to assumptions could So expansion magnitude color we Obviously, on or year conservative progresses. and And rates. maybe or just the if XX% here know any at ARPU talked the rate and plus John, and exiting I the a it’s consider John Dan, as just the take cadence you growth ramp good trajectory, you that be the just or

So Any be anyway, guys. will thanks that all. color

Darrin. Sure,

You packed one a it. question. to try I’ll of lot most into that get

as business. we of XX% that X The for that over underlying last seen think are I consensus XX a are we’ve look, see we kind and year, adopting we weeks that’s outlook in XXXX on And to I noted, range. So the in the more the the conservative stance e-commerce growth. is our have allowed what informed the estimates by

so start assumption a And fundamental to sort that’s of with.

percentage our As in income our lower And the we’ve imagine in for base pretty noted it’s remarks, prepared the cohorts. us, to what I see is of overall. you just around U.S. similar like user spending seen – my weakness in

year. with income there this large cohorts, on more And it from So of that. cohort speaking, that benefited around and that’s earlier was curve they a got higher where base. stimulus that the buying effects But people user an base. curve, boats going periods inflationary a around our of inelastic demand has don’t percentage are percentage our out And I in Certainly, maybe certainly but generally Venmo. demand with a is and of are, impact our business. you’ve is had And this think this a prior pricing more a elastic we’re seeing lower

we persists that going when so the it’s be of it’s improves to range. doesn’t And revenue If of improve, of then range. it end the upper range this that that year, at and lower then appreciably, the for if guidance end provide

of because of we prepared sort that as perspective of his supply clearly quarter half, of I talked difficult seen remarks, notably Dan And the about, of that midpoint, sorry, the in improved the so you half. have half the the that million get from and has that if has the $XXX we’ve business, in comp sorry, most eBay our impact pressures first year-over-year year, in I in am most the first and some the chain half right am a cadence, first is do – With impact first it take that back issues we the the to some inflationary now, respect expectation year.

begin passed to and As rollout of some we some see initiatives our product that at from benefits through get new of same the the also time the year.

the The second of half very that will we be there is anyone and as medium-term back all power our as much guidance. are much demonstrate you to and look, half exit rate so better the much an we want more looking to business with line forward of year of in much to and our

revenue growing look XX% Darrin, you numbers that if our you revenue the about year I fourth at think from whether be in numbers a would also ex-eBay ex-eBay, XX% ex-eBay uncouple look headline XX% revenue growth it at from and it ago. revenue CAGR, growth CAGR. the X-year it’s over And quarter

again. You in is got CAGR which of low the up, year. X-year you our year growth a revenue the the of XX% XX% ago. two on look ex-eBay, are have ex-eBay about we quarter of revenues first And Add quarter, a top XX% growing

are our was CAGRs consistent. remarks also So, is remarkably what my I saying consistent remarkably business and is our X-year ex-eBay that in

that, plus the XX% that the goes and look which strength quarter. obviously, into math And growth end two lapping we think are of that at we we as just the year. year, maintained have in so growth first go strongest the rates of we we on then numbers initiatives those you and of as June as half also the headline lapping And back you we see away And by quarter-over-quarter. exceeding of quarters our all numbers, if look are the we the are I behind their exit see the eBay, doing, second and can top of

Thanks Understood. Great. guys.

you. Thank

from from question Keane the comes Bank. Bryan line Deutsche next of Your

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is for Thanks a rate. to stop, it did guys. the take about Hi a or rate, ask also there. down the forward with like And moderation pricing, with there my I Venmo mix Venmo Pay going X-year I other if PXP It think, about there, It being take that of alleviates the going especially benefits internationally wanted versus from thinking decline. and monetization, any and looks guide the take question. taking thinking about branded just rate factor, then Braintree. domestically

thinking with just factors, those could about maybe help us that. So, you John,

rate. pricing some And Well, to for last and we third in million this rate Venmo, starting see quarter some excited of sequential been the in underscores noted, think we roughly see Venmo have do year quarter. our to were business, a I Sure. achieved take in And that contributor increase the strength to around versus in take the that’s saying of time. revenue quite to be $XXX Dan the sort having pleased as it particularly also, it’s

results. forward. a to Brian, don’t glad are quarter, are it’s I we But the every fair though, We that show think see assume, in actually the going going it’s that right step direction. sequential to increase to a

if the related half And goes take you rate to this I certainly, get at course, declined. take was factors into we year think And year-over-year look as at the year-over-year that to a way of the is half about drove away basis that of looking that But rate better of year. eBay. decline of back that for points, really roughly change. think the maybe XX

X contributor, decline cross-border or largest transactions. X exchange points which to next foreign decrease was basis other in about The on that that related a fees we was points basis monetize

sometimes that goes so up. And

look pleased base. proposition how that and our take core overlay the So, like think – that, to change that small at what’s there think we And with that the if when it value the underscores you I actually also business, and very a with really change in pricing quite about you I customer contributed that. resonates on like that is happening so it rate made

becoming people are time, wallets, choosing ecosystems other or more brand like PayPal PayPal. to users are to choice side-by-side the We choose ours. the And of XX% seeing given more loyal when than look,

of we shows it, of And so into the rate. on half last back just don’t network we business, the year. some cleaner much translating in noise see been next pleased couple that into over to the and this strength of effect that the compares our in ubiquity, And years, will and are the that’s we persisting have take of frankly, our the get of that’s effect comparison the

revenues on see I year, year growing at with mean Venmo you revenue if revenue to XX% one this remarks. continues mean I I at is active grow. per exiting as XX% their of expand think think the revenues part plus And plus. growing another average of can that Yes. we look million Venmo $XXX we I our will just John’s about as

look now we before, bunch a of so things pressure rate. are think at we And And that take putting seeing when are of on opposite I we the curve.

stabilization well I pressure rate, least on the not at the think take it. bodes obviously on of if that

you Great. much. very Thank

bet. You

Thank you.

from comes the from MoffettNathanson. line Ellis question Lisa of Next

is now line open. Your

couple my question. Good tough Thanks of taking quarters out pandemic. has a of been Alright. for afternoon coming it Well, guys. here the

to and to You this making growth. world have have strategic in order taking what NNA back, highlighted, been making of the ARPU a of But adjustments adjust shift, are growth course, are in shift from beyond over later that look as you into reaccelerate step growth some other just and the XXXX? out detail you new now to operational you

into between eye transition, the little pandemic of of the eBay of happened concurrently. sort Lisa, us inflation which end and there of entering bit is a

us a quarters. have been out in checkout. have are of would early though to that, point to the wallets. one going out has are been strong showing numerous we and ex-eBay, you you in going where wallet scale, studies. in PayPal a Lisa, several preference those thing, are overwhelming of that into close at seeing eBay number in sort us, an digital impact is quarters checkout. this our other the of increasing say over is have the big lapping quite digital people put is we in wallets year terms just impact, put there is clearly, financial super And JPM we the half and is was lapping out consistent no of first ascendancy conflating half. other talked pretty last is for is a the move about that looked as core And very promising I lot business extraordinarily the back – which although trying are There of the lessening of payments, out, the into just clearly, until results. to consumer wallets, there to take of times I one growth And we end. have and share the coming of digital why pandemic that, apps app So, for beginning If super

tab uses months into rolled up per the the When across XX%, the app is users tab Now, we going fully of into out XXX%, checkout. merchants are active less. donations are to up first-time middle up we our the in just over are to versus only churn seeing in-app seeing, people and shopping account when somebody people XX%, three are that The into shop average is from app our XX% XXX%. of so iOS shopping Android, to four their app, discoverability revenue October is months people or we up double But of all it. is somebody what propensity and coming we coming the crypto uses

our XX% are of what base really the the And And encouraged right so by on the by app about are we app. we has way, the app, only seeing now.

you by of and discover seeing has another bill want app. ARPA can the many times, first-time like make go that XX%. there. bit service, grows people every want a we about to that users have to a time we talked into ways inside services dollars on XXX% people the it We things still it because increase sure So, are like they moving quite in to add penetrate marketing And to like spend and pay, app, I

heavily we focus going digital to so And on are wallet.

numerous to bread we feel on because that checkout best-in-class are experience, We a is continue checking are have out going we to PayPal, ways. of and and butter focus and the there

We continue to improve that.

to role. tremendous pay are at an for in incremental just capabilities, from Brazil Japan also to going into focused markets of and the acquisition move looking years, off buy the markets we accelerate. China Mexico increase set extension international leveraging now, potentially a got a is which Paidy like in We leveraging X really later LISC And on and

And us and growth forward. in and clearly back So, are scale mine had enable operating his I is as And going our significant very pre-pandemic, John that go OpEx that is our scale would growth a script well the final thing expand having mentioned margins move more number forward. we think towards that opportunity that will unit in to the I going did focused that economics on. as leverage, we of we think there help that that to normalized increased leverage improved utilizing we is for things say which we

at changes you as why are are through And so see the focused will go of where that kind such and revenues of operational we XX%. year, we those improving the we have and earnings confidence acceleration

you. Very Thank helpful.

You bet.

Thank you.

comes of Your from America. line Jason the next Bank of question Kupferberg from

Your line is open. now

Thank you, guys. Appreciate it.

targets you So, EPS said positioned period. last you achieve that and have X-year are I know the over to the medium-term X revenue the guidance years of

you that So, you drive entirety? in are at we guess, still be targets basis, the expect its when you. basis Thank we if to what X-year And look necessary can these those the the levels on achieve X-year you would really to in think I not, increase engagement? below assume CAGR if

I you. with speak to question. good appreciate It’s Jason. the Sure, clarifying

are the were than look, there did exactly through anyone So you time the going plan not in business some any rarer our we time guidance. at assumes and pressures we on a that our contemplated seeing business cycle, not it’s we a years, are cycle out business longer-range that ever multiple certainly that macroeconomic but put over

– we is those are X XX% have XX% business, much growth going not think correct, that opportunities challenging. is that that grow. CAGR the more But have correct the growth in out earnings and in is of more when still you earnings achieve can done of that that in rate you that, power that have, we growth the compounded you mathematically, about look, core XXXX. we we growth you the But first back much annual step to e-commerce core revenue years and are beyond because confidence So, rates of years the

forward seeing still that. a around are We pull

things seeing the have. wallet, of And say the in all still brand even primacy scale us the benefit increase that us. digital even the benefit digital I because these and are We payments, would more we of of

trends, And so argue shouldn’t our has real benefit that digitization been conflate which business. never people income positioning we stronger. changes I with would disposable in like our competitive of

are so and focused ‘XX And very we can growth rates. we ‘XX in those achieve and that demonstrating XXXX,

Appreciate the clarification. Okay.

Thank you.

question next David of the from Your comes from line Evercore ISI. Togut

now is open. line Your

PayPal enter a This what was XXXX bit see plus you so but structural for exit And to to headwinds much. called have touched should related increase expected on XXXX, Thanks earlier, as the revenue of the What’s sustaining the some you for as in apps? of given out growing the then we you expansion we example, are XX% have focus with XXXX. of new on you super timeline changes watch that, engagement? pivot growth the discussed, applications the

preference would changes much in us our ecosystem, of some part is wallets David, engaged as pay. to in structural wallet. of in to will parts digital this particularly front so a They of using start? you including gravitation And to movement, I earlier, covered become our a start suggest some forward, checkout to but when that someone noted our which think questions, likely going we second relevant PayPal to wallet debit as more with of much couple digital with is Well, brand is beginning go strategy to why the app continue ecosystems. are on more and it see only maybe that’s in are from for of fact, parcel in more be part And only like transactions. towards first terms we using studies, in or ways preference digital other to bit consumers. of to versus offline we and And are Where credit we a emphasizing is question, see I in more because other your our we and the little

the it’s think getting I difficult. correct precisely I related during the that that pandemic. function we timing that, is reach to only on that are don’t pandemic down pivot accelerated the that continuing think sometimes But of when that And and step or change these argue structural anyone things, changes so been are trend we would all

streams issues for export cross-border. way and chain its quite a like at is of Just feel typically double-digit for This positive impacting us way that like profitable through. their it China, supply look One, add to it’s things. couple double-digit turn around we we will out work will of us, obviously, revenue actually going negative, and When that’s forward.

of this there. year. things these But digital we the and some So, time. out in know are over will of functionality temporal for we a wanted we change on put ton measured to guidance put the we be And out wallet, out that new

of are We started are we That at that started end ramp with Synchrony. just savings product the to high-yield introducing the January.

with to XXX% that aiming early are QX, of by We end the be QX. ramped

really on around year, of services of and number quite propositions those have efforts – to are this lot a to waiting of list spend each various best-in-class every them. the want single enhancing create one we products We our that. of people And for a value

step good of our a have first I comprehensive, wallet. think digital we really

think will linked other. areas each when propositions improve, is of we time, amount be model. but features business add then a our The occurs. really this opportunity year expand penetration the in that I of app, incremental what because each can the we and introducing tremendous these in our app are value can And that when better has more over services people see leverage to more happens because to

very much. you Thank

You bet.

one for Suisse. have Timothy time last Credit we question And from Chiodo from

now is Your open. line

the year. Venmo that year, onus year’s this growth, question. think what could like on it that $XXX think for alluded if the fiscal terms QX, for XXXX was us your of million and in then you And earlier is of think like might you When the mentioned taking well? next growth the $XXX sort business, we full to beyond we to implied terms we growth Thank is and you and revenue that next you did million about of in the in look around of contribute? as terms what I what Venmo for in Dan, will. into what roughly XXXX of know about I think how for or monetization? Venmo And Great. about could rest for to you tell revenue

Yes.

they lot add I year. more because app think this super Venmo did services. year, that the a their live to consumer top the on plus of what XX% Eventually, Venmo or to are going you on incremental we wants continuing see have of more of Obviously, financial are capabilities revenue the are it growth app. and for that PayPal loves this to has base Venmo, contemplating life

out United Think over the a about that of take right population. every of that the is using as percentage one have million have now. to We XX in Venmo Yes, X.X people the States. now right using people plans U.S. like overseas. Venmo in it’s We obviously

very DoorDash, are Starbucks, pay Amazon, a last going high-profile did with things with that be We quite are Venmo year. number rolling that on of are the merchants I mean out they of with there be going implementing to all of with top Venmo to

we have lot both against well. a in And as as we is to really progress, the of the I the team feel mentioned. yet go, against promise their objectives, stages like executing got roadmap are so extremely beginning of well monetization I but importantly,

And to our I as rate see on grows, its I to adds starts rates to it a to remarks, grows one. ability think mentioned you as certainly in downward upward grow to pressure so by grow. it take Venmo obviously, an when take and add continue my that ARPU just way, opposed And the to

We final a is your great question. and to meeting your with questions. thank want of care, for soon, our as lot we of forward all well. for we today. of time all you We was there Realize thank again, put look speaking with and do think it. Take I want time. for information to And you that in you bye-bye. everybody thank that person. And really I your appreciate out to you

call. conference today’s concludes This

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