PayPal (PYPL) 1 Nov 232023 Q3 Earnings call transcript

Good evening. My name is Krista, and I'll be your conference operator today. At this time, I would like to welcome everyone to the PayPal Holdings Earnings Conference Call for the Third Quarter 2023. [Operator Instructions] Thank you. I would now like to introduce your host for today's call, Ryan Wallace, Head of Investor Relations. ahead. go Please

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

our Joining This CFO. presentation available measures. We're Chriss, performance, a refer slide Both is company's and the the accompany and Rabinovitch, is providing me on our also to to Relations and webcast. commentary. Gabrielle acting are President website. In call will our CEO; Alex non-GAAP and SVP presentation today on conference call discussing our we Investor some call being

You the can find the the reconciliation measures call. of these non-GAAP most measures comparable presentation to conference directly accompanying this in GAAP

statements forward-looking and for our foreign margin, guidance include, current activity. statements make and exchange based are for expectations, the share will third operating our assumptions on and year assumptions to risks sale forecasts involve to planning quarter XXXX, our our related anticipated KKR rates, These of from repurchase loans without We and full XXXX, limitation, that uncertainties. comments our impacts and

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

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

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leverage margin declined points XX operating margin with offsetting expense to largely non-GAAP Our transaction operating XX.X%, compression. basis

XX% and of represents cash last investments generated exceeded XX% our which billion We billion. $X.XX, $X.XX. quarter We the $XX free cash quarter, non-GAAP EPS a equivalents flow, to which decline high from by guidance with For of range in increased the year. ended cash, the quarter third end $X.X third the

this cash we from free the periods, inflow billion. temporary outflows dynamic cash the of Adjusting flow from operations. In cash an reminder, and flow sell a for portfolio grew we are installment As European quarter, In offsetting to from million. future All loans as originated KKR as to we intended are operations. held-for-sale. this also last to sales flow in QX, classified as reduced that this loans flow free impact, cash held-for-sale $XXX as by XX% subsequently reflected within $X.X to proceeds classified cash will recognize

sheet Our for and flow with creation. generation are strong balance competitive and cash free provide optionality differentiators significant us value

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priorities even enable home sale, which will is a UPS. expected current business process quarter, As you Returns We're Happy heard divesting we're price. can September, our an following team aligning Alex, with us many right more Happy able our This the core in focus, to to accelerate With effective. our the on from priorities. I focus we're approach, evaluating we find and more and long-term our Happy this velocity In Consistent Returns. to close branded with [indiscernible] growth on to be meaningfully call thrilled expected. greater higher like agreement our the Relative has than remainder was cash, earnings sell our would Returns that million our outlook than we to rigorous X entered to discuss to checkout over plan for of months, in growth UPS ago, acquisition lower $XXX for laid year. now into out months the the our been to put resources

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non-GAAP In $X.XX, relative approximately in growth representing QX XX% to addition, expect to XXXX. be we EPS

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In contract last operating non-GAAP quarter margin to we fourth the addition, our year. expect from

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ahead. that to we're $X.X In cash closing, be least now believe billion. In flow navigate well at free we to positioned expect the addition, road we for XXXX

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

more could work last example, maybe kind appreciate assets and out early more and thought. sold, you love to a here. your the your surprised than around assets divestitures, PayPal? require on that And Alex, replatforming, what as being more portfolio you Can of to Happy to share Returns what see thing. at impressions you little observations maybe week, for if, priorities and of bit I called the upside products sales, hear the turn what just we

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line Barclays. Your El-Assal next comes the from of Ramsey question from

clarity you all the your appreciate on provided guys priorities. I

SMB past? or I at such on you SMBs, some some road also of with which do the point? becoming to You question business you guess And the get great gave the map strategy important of your us product to commentary most areas this PayPal's as approach is, a guess the detail innovation part up prior charged more on see side SMB the of PPCP. I experience given your relative

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

you Gabrielle, bit in the broadly? you you're you're the give to Can role, quarter, more I holidays a a know your for in everything. Alex, color a congrats and you in outlook both lowered thanks think we your for Guys, on perhaps again continue just U.S. in investors. you'll outlook missed led fourth be revenue globally? on if us for know bit seeing profit decrease I you Obviously, gross see or the is cautious seeing new anything said a anything and by what to quarter. what trends the fourth either more just And on more environment on e-com, and

really meaningful our Yes, healthy Thanks seeing for very of environment. Darrin, QX, you our We're the heart say demand into bet. trends no in or the Overall, we our performance heading checkout we're in business. I'd see question. shifts and

approach obviously, outcomes. We to QX, range have for taken and an appropriately planning we've contemplated prudent of a

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Sachs. comes Ng from from Mike Your next of Goldman line the question

the OpEx efficiency? declining The about company the should years think balancing that for about talked how in and Could about need being appreciate bit role, ahead. comments investment you cost the still previously Is thanks about around keep base how think just -- congratulations too for to Alex, everything. high. little the new First, we talk opportunity it a think you versus Gabrielle, the future? managing your on I the and for

Yes. Thanks, Mike.

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

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ahead. Faucette question. time Morgan have James Stanley, from X go for please We more

the for welcome done to and in my thanks add Alex to to want I she's work seat. And Gabrielle CFO the all

around the is seems you're kind how One about about assets of really within thinking Venmo. U.S. that demographically. the that. And and it's you wondering I'm its It that acceptance of the of like expanding to-dos talked population important

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I turn Chriss closing Alex over for will the conference to remarks. now

growing and Great. see about improving are And Thank board Krista. how thanks, for joining Hopefully, the everyone, PayPal quickly us as you, we today. possible. as you across can serious

thoughts. leave to want I with close, you we Before X

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out our are win. look you in our our We ahead, a talking to going playing Thank forward have we business. for are I In clear the and with great call day. next February customers laying you, our months to to and and be moving velocity weeks plan to on deliver all and to to win.

call. for conference concludes participation, Thank This today's your disconnect. and you you may now