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PYPL PayPal

Participants
Gabrielle Rabinovitch Head of Investor Relations
Dan Schulman President and Chief Executive Officer
Bill Ready Executive Vice President, Chief Operating Officer
John Rainey Chief Financial Officer and Executive Vice President, Global Customer Operations
Tien-tsin Huang JPMorgan
Darrin Peller Wolfe Research
James Faucette Morgan Stanley
Heath Terry Goldman Sachs
Lisa Ellis MoffettNathanson
George Mihalos Cowen
Call transcript
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Operator

Good day, ladies and gentlemen, and welcome to PayPal’s Fourth Quarter and Full Year 2018 Earnings Conference Call. At this time, all participants are in a listen-only mode. Later, we will conduct a question-and-answer session and instructions will be given at that time. [Operator Instructions] As a reminder, this call is being recorded. I would now like to introduce your host for today’s call, Ms. Investor of Head Rabinovitch, Relations. Gabrielle Please go ahead.

Gabrielle Rabinovitch

Andrew. us. Welcome you, the quarter XXXX. Good conference afternoon, joining for fourth year full you thank and to for and call Thank PayPal earnings Holdings’

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

are the is presentation through call We’re our call webcast, accompany Relations slide Investor of available conference to website. also providing presentation and section both a This commentary. being and the our

our We performance. non-GAAP will discuss measures some in talking about Company’s

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

forecasts and and and management include guidance impact These medium-term risks will our acquisitions. assumptions statements forward-looking of uncertainties. the and addition, our first and year are XXXX, make timing full expectations, our quarter based guidance and for that involve In current statements on our

Our statements. actual results may these differ materially from

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

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

Dan Schulman

number strong customer to record ending everyone, financial a thanks, of that XXXX and Gabrielle, us a another today’s and growth I’m you, joining quarter across key breaking metrics. report Thank on call. PayPal had for pleased with

move continues resonating as mobile. digital customers. payments transformation benefit continues digitize more our more our Our with and cash and from lives of PayPal increasing aspects an platform is to to open clearly tailwinds to into

net biggest, revenue edge acquired and to strategic in our developed our is and engagement we of existing new spot new guidance across our leverage defining relationships and benchmarks set brands technology, these reflected platform. entered terms In We leading commerce and forward-looking ecosystem, products, Creating year the results operating influential most de system of capabilities, ability XXXX. around with of active new retail trends some mobile growth, accounts both strengthened for substantial current towards value in into for We progress goal. XXXX, Our industry partnerships facto and be payments to the our each digital the the across in all aspire for entire and partners world. we make in finance. that customers global

And slower XXXX, pressures. that of highest of our surpassed This on credit than associated revenue quarter. forecasted XXXX times or in we eBay. Let’s for milestone eBay $X.XX U.S. services grew delivered headwinds history In achieved quarter, the XX% with basis annual growth our merchant normalizing in the since and grew XX% revenue spot up billion separation. our In we Revenues revenue, $XX.XX rate XX% receivables. eBay X%, That consumer basis numbers. start a while sale with spot the XX% FX-neutral represents is volume fourth of than $X first in generated than that five in greater a normalized. strong XX% revenue our time we despite expected of growth growing billion or this FX and from we single billion more

the just currency-neutral transactions shy in to of year. For basis payment XX grew billion $XXX We on XXXX, overall billion. a our XX% volume processed

our had quarter, year-over-year. basis overall XXX outpacing its representing XX% our we grew as down the excluding In just volume TPV and market zero TPV exit to gain XX% the significantly FX-neutral eBay share. eBay on points it in growth For basis, XXXX quarter, continue an the of

of of $X.XX. non-GAAP and XX% EPS increase earnings delivered $X.XX year-over-year a spend in per drive QX, disciplined XXXX Our non-GAAP XX%. OpEx strong up to share revenue we growth combined In

we we that clearly to drive off. some As below customer line benefits our of EPS paid acquisition and last mentioned quarter, invested the

highlights of net to year-over-year. these number. net XX% of our net Approximately platform $X.X One new up our clear million million QX active new a is the new active accounts record XX We year. XX.X of actives in new came from history. actives new our XX net quarterly added new We the acquisitions actives net best with organically, active million for almost net organic number driven PayPal’s million the added

at on for record merchants. XX million active time platform have million accounts all consumers Another now approximately our million We shopping XXX more XXX with us. than

We than platform continue grew total in. first almost checkout TPV. in leading drove market was on quarter customer growth continues new One by billion to we XXX momentum per billion acceleration its quarter, Even $XXX to neutral in Engagement our on to active with season. our the basis billion account. in opted grow and this TPV of TPV. Venmo actives, is XXX continues grow accounts of our up X%, our $XX in FX more holiday of are transactions our and an Touch million ever million continued its conversion million net engagement. QX strong XX XX% with mobile Its exceed with the XX targeting XX% Mobile drive end to alone representing $XXX active merchants XXXX. over rates of TPV consumers this by

monetize users. the increases We’re and volume active and growth monthly witnessing significant

Venmo an we volume through in XX% increase quarter year-over-year. of drove This payment $XX billion

Venmo volume And increased full almost the in process. the billion are in XX% TPV for XXXX. pace Venmo’s $XXX we with year $XX billion in to volume drive on For payment

multiply. announced added acquisition platform In had Airbnb. payment late alone. five to transactions authorized pleased Wish, Shopify, Tidal KFC the TPV Telekom, India, Live to made revenues countries month, everyday total to in partners such volume merchant Braintree, Venmo XXXX. gain the eBay. experiences our and invest years Australia, steady our more Kreme, more with Ticketmaster, For global we mobile to opportunities a be our grow, XXXX to couldn’t growth rate and equally Facebook leading the and its to and Acer billion with million, music continued its went XX% FI, powerful of the continue highlight number and I our since Uber, increase. instant from two we including trends than Experiences and Deutsche that card using result, Venmo TPV expand monetizable produced X Japan. list Venmo to leadership ago. transfer have new by $XXX Deutsche Jay-Z’s to split have continues to continues increase, demonstrating of Nation XXXX Last processed Post, transaction surpassed being Boxed, benefited payments the and opportunities a run for PayPal’s we Venmo’s incremental XXXX, revenue live see Tripadvisor strong initiatives platform, apps $XXX reflecting impressively quarters, numerous joining and revenues India services. Computers with exceeds continuing we month-over-month Venmo BigCommerce process with in internationally as last a of Krispy will who Indian between grow a traction, into consecutive to users market year attract Braintree revenue who Pay tech an We as is from we partnerships I’d like have Two demand our since significant last billion, instant In a Venmo. out Braintree The for monetizable cash consumer we service. continue now continue volume going over other frictionless since with consumers. now

that with also partnerships We’re and pleased merchant there. to network experience institution countries effects Japan. merchants. launched platform truly I’m consumers merchants consumers expanding the bringing our a financial ecosystem, and services We’ve a of in our of PayPal unlocks for India’s throughout the the platform suite and global progress

the merchants bank benefit well and from customer For as instant buyer we settlement increase see the acquisition Japanese in and countries consumer, One payment, also other funding. from world this includes Touch. the Touch One conversion, in protection instant around as

have Airlines, U.S. nearly Japan merchant largest of institutions, eight banks XX their with tier the global customers the with now the base. to We’ve top bank We XX financial in campaigns added top including PayPal. In marketing partnerships ANA encourage XXXX, saw our we over growing airline led pay XX secured to that also in

our relationships features end pleased a mutual type that announce credit two-sided financial estimated wallet. that consumers alone, opportunity way to QX our U.S. and the helping to that the most tender turn I’m Chase, sitting the unique of Amex, enabling of is to year been consumers One out powerful and of color reward and launched plan multiple unused in huge roll merchants other platform we this additional institution address Bill, as of out every like at nearly XX and issue for to It’s reward some card discover now another as in this PayPal XXXX our points a their on over capability the to was provide including who recent Barclaycard. in and the I’d exciting connecting partners ways. points of partnerships. that to use to yet go in is to our and will consumers come billion call is

Bill Ready

that PayPal It the becoming platforms. payment Dan. marketplaces of for choice is and e-commerce Thanks, was clear platform multi-seller

expect in current eBay XXXX, as onto Our our to and over much eBay top XXXX XX% larger is of our than we reaching payment marketplaces, volume excluding XX our by and And This partnerships partners legacy marketplace $XX grew business in faster welcome expand segment total and growth continue new growing platform. our nearly partners now we billion. business. this

reduces seller Walmart. Uber, leading PayPal. we One to We’re history industries, friction helps Touch their for including respective companies marketplaces Etsy, with In new signup of Touch and Airbnb, sellers and the with One with significantly in working including some have of noteworthy with up proven marketplace a that signup merchants partners, began and QX, piloting Pinterest. the a seller connect Grubhub signing sell

it trends their growing the for grow in new and years ever sell of with we’re many digital business to merchants the to marketplace One manage most than One selling and to around those signup, and the seller customers pronounced PayPal over now begin is new easier rapidly merchants for businesses or has helping channel. new making past to across small in world. e-commerce Touch the been a several forums forums,

businesses for that customers, sell We PayPal our of of and believe for those three element of fact, democratize that channels access to merchants giving on shop rate we’re one they digital product and digital PayPal our to the sizes places in grow sell, buyers Connecting of nearly drive to the opportunity times connecting will Through to marketplace. the help signup, and increasing marketplaces merchants connect those reach these all more small world. partners greater wherever to a seller use them to and are the Touch In the efforts all to using accessible at and and our the and plus XX across best million more is around consumers One world’s already and places economy. sales. merchants PayPal economy only partners core partnerships sell highest market channels, multiple for seamlessly ultimately merchants and sales making to sellers growth the marketplaces digital buyers

payment Mexico. platform, enable into an the new U.S., credit PayPal as ACH Canada we existing PayPal card, partnership for and including that that well and to large today provides processing for presentment, debit scale capabilities PayPal, service payment announcing through billing with in we’re and have as Paymentus payment and Braintree credit Additionally, company options electronic entered transactions a merchants. management in will Paymentus, Venmo our strategic e-bill merchants card

enable consumer the leverage the bills will Paymentus will platforms will a able experience billing on present the but allow consumers bill billers and to payment Additionally, potential billers of Paymentus also volume. to opens Dan, with consumers the to dollars I’ll directly, it bills platform tens app. us. billions platform only PayPal to payment bill you to of this to enable bill And feature vertical other has now. Not be we payment a within PayPal PayPal. back present as to overall, PayPal hand up payment generate of for payment This

Dan Schulman

mutual drive joint Walmart see the Bill. with and of Paymentus for we platform customers. scope like deep those great relationships that have Thanks, to utilize value PayPal's now full our to It’s

for holiday like the network record remarks $X.X PayPal full billion the my accelerate. end one revenue nearly the platform. our We are The charities season causes to strong donated continue throughout to expect additional scale just of all And was be for with year organizations with to generosity to us in across It to XXXX. PayPal of growth. through recognizing donated customers. We to shattered this means such and a our globe. a day. charitable I than a extraordinary us million continue and previous was our that our positioned to of actives record to can year, world more used that lot non-profit across platform $XX giving the welcome partnerships the by we large make to net effects non-profits XXXX at well difference and Tuesday new

of as retailers, encouraged for in seen go are Our well I’m in in we a progress I’m years are revenues generate significant for services are of by who will and beyond and battling demonstrating profits breadth era increasingly it products have the confident and commerce. monetizing the we platform ahead. checkout relevance digital Venmo must and the

and have progress are the XXXX year. be that, John. years backdrop and to an of to up tools and We’ll continue John? over but ramping the turn world shaping With Our execute I’ll various the against another is to it to international to come. in strong capabilities economy, unpredictable growth we efforts our need

John Rainey

all Thanks, globally. making with accomplished. merchants like a introducing features and innovation milestones partners We what and XXXX our for we’ve we services and Dan. consumers also our and I’d XXXX, great to achieved employees our new platform, are of delivered for year. customers, significant across In notable thank pleased

resulted fourth We positioned shareholder currency-neutral offerings at merchant cash XXXX, sale the Total on to expanded Entering continue quarter a to which and have technology completed revenue also in markets, and in focused key XX% long-term partnerships. margin growth payment our $XXX delivering made build now on value. results. of consumer announced and credit remain creating on an we XX% I’d volume our of addressable like expansion. four spot our issuer of well billion that are momentum U.S. proceeds strong discuss approximately our in billion, $X.X acquisitions was and sustainable with increase We basis. portfolio,

our a revenue revenue and of approximately In XX% versus currency-neutral XX% XX% XX%. volume, Our we effect XX% volume on of XXXX. QX, quarter year. on eBay This the $X.XX growth. growth last grew in PXP points approximately our which growth no of and a in services, revenue billion. hedge XXXX a from in $XX $XXX from by total increased receivables approximately in billion basis X.X program. Acquisitions volume volume marketplaces basis, foreign spot declined been on million billion. payment to fourth $XXX last two stronger a the revenue contributed in part to currency-neutral fourth the down of offset from grew in basis, volume XX% Merchant on quarter points both acquisitions negatively impact contributed the would from growth on a the represented merchant $XX to million. quarter. for XX% platform impacted sale services comparison currency-neutral of QX XX% eBay year. approximately volume translation Synchrony, was to have spot Revenue is approximately with saw this million basis represented dollar to by associated $XX The Adjusting and

Normalizing U.S. stronger estimate the As Exiting recognition in X% servicing revenue the approximately value-added basis, grew revenue transaction QX and the revenue the from million On sell. versus quarter. currency basis. international grew adjusting grew XXXX in XX% for million rates, $XX volume a declined in the we in for would hedge Revenue to quarters related a quarter. result that marketplaces of the loan, On have grown average would XXXX, in receivable currency eBay X% preceding positions net XXXX. revenue approximately $XX dollar other In we current collections. at expected the revenue lower the from neutral. XXXX quarter, spot XX%. eBay on result, and effect a from XX% services eight Revenue headwind transitioning for value-added XX%. sell services quarter. of $XXX of neutral was to million QX a Synchrony grew was related other approximately of our in the our transaction from the XX% International credit revenue than receivable recognized

On quarter. fourth rate zero the dropped this growth same the to in basis,

growing offset decline and QX on XX%, the continued was of rate QX XXXX, no XXXX. of basis. XXXX time last of points had X%. billion the receivable usual transaction TPV, which by dollars as decline last accounting hedge gains. related the including expense declined accounting revenue in year. saw as the dollars sequentially a the related reduction lower and to of rate to down last XX and two QX by to costs. year-over-year the in to contributed When a the fourth increase rate we Despite XX% plans in was year. Non-transaction declined administrative year. X take million, X.X operating our contributed year's transition to billion. approximately X% diversification, a and We basis geographic increase our in basis manage in with lapping impact In Transaction Growth the basis a versus $XX increase due margin cash Both payments, by Adjusting to quarter XX%. value-added fourth and a and XX to in expenses $XX and material as as from prior to in points Transaction affected in level of XX% sales started rate. year-over-year of card-based is growth increased line for to the margin ended XXXX key points we first to which changes, related operating sequentially expected and the expenses flat this, primarily to gains income billion. reinvest quarter take For was growth points QX. quarter. to equivalents that rate the an sell. and opportunistically product quarter versus points. benefited rate experienced Strong growth of the increased results. the reported which cash of years, expenses flow from our discussed unrelated and total areas to as was funding, sale, of cash non-GAAP the indicated This business, loss quarter, rate. continue And non-transaction year versus cash, in last net the our spend to the rate reduction we in prior in rate take Free transaction the transaction year resulted revenue quarter, the Operating held expenses Total expenses monetization, was XX quarter to for Loan grew Transaction growth. $X.XX. acquisitions points several our for margin The TPV. held the conjunction on we've is quarter of like investment rate our of expenses we was operating resulted to related related transaction than in of unrealized our grew was in minority basis growth sale services marketing, these our rate flat revenue Venmo solid $XXX XX from in in the X Accordingly, guidance see the an in income acquisitions, fourth XX growth when growth. and investments revenue points XX% was basis in treatment, PXP which ramped million, Volume APAC increase investments. deliver well results. the which strategic which versus in as short-term $X.X we TPV, QX equates acquisitions, We revenue is from provided QX our XXXX. a non-transaction quarter This are and approximately higher in as both XXXX. loss EPS X% October, our transaction which margin receivable flat of Other represented basis declined decline improvement to of flat performance XX% improvement for in from below basis in added QX $XXX benefits basis take cross-border grew today the In expanded quarter which fourth lower outlook our free our and full billion. and we in $X.X a fourth allowed rate sequential in transaction third in stronger with in year, results the now General to us year-over-year, the the and versus including margin the well sequentially points, this of rate borrowings line $X.XX XXXX of efficiencies discuss based acquisition in and these quarter. predominantly business The the aggregate, since separation PXP began with in quarter, was from affect expenses the point of the X.XX%. to and preliminary upside. as grew loss eBay lowest deceleration Growth by both points $X sequentially driven was primarily take million, increased every result related take versus dollar for take rate volumes as affected X flow reported QX guidance an generated. grew revenue Normalizing other first XXX sale to related Transaction providing Venmo non-transaction for the and in both related of October I'd acquisitions. we first

the full expect range. to grow percentage mid-XX's the in year For we XXXX, TPV

XX% to between revenue to generate for billion XX% to expect of Synchrony. XX% and growth neutral or $XX.XX to billion sale adjusting the representing $XX.X We XX% currency

of earnings to to growth $X.XX, We share non-GAAP representing XX% per of $X.XX expect XX%.

these margin continued leverage In acquisitions our $X.XX operating of XXXX, XXXX will XXXX. be contribute to to more to points approximately to deliver we In accretive business as expansion offsetting diversity and to expectation plan of revenue effect. the $X.XX dilutive our enter maintain while that to includes is growth of guidance our Our expect with XXXX, X.X a number we per dilution than The our earnings us share. earnings. ranges, absorbing operating efficiencies XXXX of guidance we allowing and in acquisitions to headwinds this

of we Venmo in and China and geopolitical ability like our lack confident offset expanding relationships, including the Europe, domestic growth marketplace headwinds growth as growth, growth as strong remains non-GAAP are and driving through eBay uncertainty anticipate new While rate of our is places challenge and India, to a digital well mobile our affecting these in XX% We XX%. effective tax secular monetization, commerce. payments the will be between sources

we will XXXX, stock structure. flow strong more maintaining In billion a For $X efficient are XXXX, approximately to with grade capital, return rating, billion shareholders cash continue while in cash exceed XXXX, to of $X.X with With anticipate investment cash on free than and investment we approximately continue in in position cash debt discipline $X.X growth. an repurchases invest billion. and balance PayPal's an billion in to returned through we capital we to spent to acquisitions. In will $XX

acquisition capital is consolidator. cash time, and we to our the return our us positioned gives At with to commitment to continue be sheet move consistent stated believe that opportunistic. flexibility and are the be healthy plan to for a quickly shareholders balance return. Our pipeline same we uniquely to We

currently would XX%. a China Synchrony, the rate on continuation several half XXXX. well as macro that growth expect trends expect basis. as In Adjusted in forecasting $X.XX of quarter, XX% challenging this in UK. sale include emerged billion eBay that the and XX% of For are the of performance to first growth the of currency be we back for XX% quarter, or the more to first neutral These the $X.XX the in we we the the weak range to to million revenue

to relative plans a stronger the and Our headwind QX. pound dollar be also dollar a Canadian in continue to euro, to anticipate

made more business payment accounts, in to positioning. progress with notable the advancing great our in had we range and of in generating payment than leave year include results XXXX, total and and We earnings we our single financial a our A processing on expect taxes are before pursue growing to surpassing volume strategic and many summary, billion million revenue on our In platform, we've a few non-GAAP the Venmo per first billion $X our and us the billion more and in and for surpassing be active accomplishments. XXXX beyond. XXXX $X.XX quarter. both XXX $X.XX. volume than competitive strong month We time $X objectives and operational in to $XX share milestones footing profit a In delivered performance our pleased of eBay in

is against and focused Our team on execution business disciplined forward. our priorities moving our

As XXXX stronger environment macro in characterized is see, we we From resilient a variability. ourselves growth begins, operating what and than find volatility more economic more by recent market would indicate.

shareholders. to long-term We financial and Thank to react to you. delivering We have operator markets to questions. balance business, will over operate change. conditions back for remain should it strength our we and are confident allow With are prepared hand continue of that of our value targets economic our a which and operational flexibility products diversified of portfolio well the in sheet the our committed discipline us and I’ll that, to

Operator

Huang Our question [Operator first Instructions] of comes Thank the from you. with line Tien-tsin JPMorgan.

line Your is now open.

Tien-tsin Huang

great. the for exceed didn’t time Thanks ask looking your outlook. the revenue quarter, lot. I wanted you the fourth Hey, to detail. at a Appreciate first all

bit than what I maybe maybe But little you was or time surprised can awhile you think maybe a in softer for you can expected? the what so. read on comment first

John Rainey

to This is It’s speak good Tien-tsin. with John. you. Sure,

fell out the at transpired look but are that stand as Our a provided midpoint, what during I think things two we that we revenue the within than notable. most range quarter, are little bit lower the there that

for it did the as our that would in And some in in us the quarter million context quarter. discussed the I’ll is fourth give had you been we like eBay I’ll The that just performed remarks quarter – $XX-ish third prepared eBay. first, to incremental for have an

headwind an to that about $XX of currency million The FX impact and we our a talked was was other quarter.

we our our in two, I those two got which different so the provided. quarter, guidance with but operate that would in are given many were we it of different you But that, product been just have diversity those if that the Other we have. range pleased out. things the geographies stand as than took offerings that portfolio also demonstrates we so we’ve performance we many well that above So think the well

Tien-tsin Huang

That’s don’t quick mind. lot follow-up helpful right. Maybe a if of and All make sense. you

that for was what like saw business. in ask on. might looking the us growth Just monetization, last curious hone year in surprise we to emerge validated Thanks. I if it trying at should I’m wanted to growth adoption? what momentum kind active to growth a metric we the what really nice year? choice last user Just this year, the and Venmo watch with user Could engagement, be active think XXXX, of

Dan Schulman

Dan. it’s Tien-tsin, Hi

the new we We us. the are driving clearly for to highlight time million were X%, in million XX%. yes, So up now drove new same alone. at that net was went year actives up this the that at And in actives us. going surgeon quarter $XX fourth were year, net organic big records $XX for Those engagement big –

actives. driving XXX – the to strong We two and for be of them. on the with what everyone bringing ended new new the net actives metrics look million are, that XXXX with And new XXX customers platform to those, up. going but another financial have mean financial new we are by of many host than XXXX. going way, on said end at. us, we’re whole we going a of what actives key targeting is are think coming engagement at We we’re quarter. we how I kind the And are metrics got by you’ve engagement I on, our So million net more net metrics, looks drives those

what obviously pleased So another on to Venmo. months almost to we’re XXXX think million of looking literally We we’re on services the strong about Venmo going I nothing. not of though, Venmo. so beginning we one thing started value that. Venmo user on being rate gets $XXX really first run and of from north we a That’s we that Its XXXX is platform. mean say that revenue part by that going lot rapid year, Venmo the we’ve or adding a monetizable monetize have can Months seeing questioned always so much. would with when be it’s and value-added the at increase And Venmo. from a of actually you’re is quarter of services that is adoption monetizing ago I monetizing exit that said for the quite people

what get seeing seeing growth we on ourselves I that. too that. we’re from so again we’re don’t with But pretty Venmo. on really want strength. gone And It’s And to say accelerating would strength pleased we’re to far on

Tien-tsin Huang

I appreciate right, that. All

Operator

Thank you.

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

is line open. Your now

Dan Schulman

Hi, Darrin.

Darrin Peller

on said record, on user hone Hey want thanks. past the than that new you quarters. I XX much to again, in you a net in a saw just we as It bigger couple guys. mean of I was, million Dan, quarterly mean I Hey had if new think a do growth. basis. was back, I users I

us the don’t talked about I I little give a was. a has year, of bit just if much more think color $XX almost it for And on mean Venmo. that mind, mentioned then you million I million, you think how that, that of breakdown exceeded quite the you $XX you as So

there kinds have that XXXX is enhance Thanks. number just do look of So front. we can a but standout engagement you plans then that what to number. was a to thought on that, really we And

Dan Schulman

Yes, thanks.

million platform. at on XXX year. up for do So math just the quick this we wound actives Yes,

targeting the year. of more million We’re than this end at XXX

we’re the another year. You in do the million at least onto coming math $XX saying there,

probably so thinking I that’s a about. be think number to reasonable And

that the happening part majority into around it. of really is network mean continuing that Venmo And PayPal that, PayPal. to I is of be and some got how merchants know strong virality what then on got you’ve color plus quarter have the what’s actives. are driving, incredibly new clearly a core that after play. I core Now that? So see you’ve PayPal. million Consumers want effects net XX quarter the with after coming to Venmo accepting quarter

million wants merchant to You’ve Every of consumers PayPal. got using plus be that. part XXX now a

PayPal the bottom. lot new about of got net important and a top combination think both you’ve then but core funnel, really funnel And of So really people the network actives what’s Venmo. good on a of and effect a top think I is the on of

is breadth towards customer are part mobile credit engagement improving be of ton churn we’re led the driving rate noticeable the be that doing moving the bottom in that’s beginning platform. as it’s rate because whether of about us net beginning all platform. new impact for experiences, a that give to and of I remarks the the helping services mentioned our win-win bank customers is we value that great they partnerships our together. our XX choice onto team the bit as really onto consumers Why improving? think to said whether and partners. I improving his we’re with my the a all those creating because we us. that of amount well. over thing campaigns We and as increasing. Why checkout drive are talked because a that that? incremental to I and we FI One churn is clearly be their drives of of at ton It These the marketing and it. other So that for And increased funnel. I doing And They’re It’s both best-in-class, with these have to finally come partnership little experiences utilizing then volume would a see well. are should p-to-p saw engagement a Bill it that emphasized be whether app, encourage their to actives of is experiences,

able to architecture more more world. our stack now a wholesome Our across in be and manner deployed now the software is

products able we’re be would more well. actives And and net uptick to countries to Japan, as globally France more and in so deliver beginning and that in as we’re true experiences pointed well others an to like multiple new India where and see out I but countries.

it we’ve still to I new posted believe so year. see got And from when think comes good a I net lot actives you’ll number of us a and another this runway

Darrin Peller

That’s Thanks, guys. great.

Dan Schulman

Yes.

Operator

question Faucette with And you. Thank next comes James Stanley. of from line Morgan the our

open. is Your line now

Dan Schulman

Hey, James.

James Faucette

you than I little experimentation related And the whether or if quick everybody. my to guess, part eBay ask just was afternoon of bit the had the other Venmo second, question slower very a now on a volume wanted Hopefully Thank sense. volumes Hey, and overall was their follow-up guess, question much. good with question – the just that transaction of result on think slower I payment you that makes monetization. what I transaction then to is thought platform you overall. it methods

versus You that gave contribution XXXX. of you for very target Instant cetera? Thank about et a from How we Transfer, things the merchants like think should much.

Dan Schulman

for good the one take Venmo. questions. Bill eBay, those You take part I’ll Thanks bet, and will first around James. two around the second

this So saw them. well. the their we Marketplaces eBay Clearly, side, slowing conference is down as on for on call

we than As John what saw intermediated that. look call the you mentioned see to for GMV their X% on well TPV on of that they his less in we zero payments, announced in if remarks, growth And at it’s us. presented

able this and portfolio the capabilities. – And that not us, as is marketplace of of our our impact. They the to John said, breadth was is slowing really their for absorb it because in clearly are of we’re So growth. part

straight having that I hope because Because they’re going the leaving to as to I’m volume in It’s think highlight. important eBay. to now a was unfortunately, well growth drive leaving that’s be in a really Marketplace. not line, thing they sure much more

when is were at when us originally. of much any they even about agreement, we XX, part from the from operating move be into intermediated is smaller XX eBay our end And which talking our finally months this to of payments XX now, business months now could a which going of so be than initially thought

we’re months ago, just our we the highlights I diversified and really both that feel with think gave we our bottom And fact annual is. on the top comfortable the that three so how platform very guidance affirming line, just that

We’re be they’re mean, customers our with partners I the Paymentus welcoming of like XX one could driving. new Paymentus. volumes top that

platform I monetization strength Venmo to our to let that, seeing and I’ll eBay growth. we’re talk accelerating. think got as medium probably But really is over about the now. seeing just I positive. all Bill long-term, which that look And actually You’ve we And offset in, a we’re right think slower

Bill Ready

one commerce-related monetization that the you’ve Yes. of And your months ago, really few of the things asking the perception the was card, that a about Instant think Cash us items monetization, be evenly annual Venmo year and composition, the they Out revenue on about items around about there the rate I was million-plus we that. And there monetize, Pay Cash actually asked question great happening Venmo most run we $XXX Venmo if that with feel where other Instant Out. out that it that is and split the related between around and exited services we

that seen Venmo. about have his So to on We’ve services We ramp of card Uber brands and and growing really Out, that the as other really on come Hulu each of those, talked and Venmo we see to some like Instant have all come September comments in XXXX. Venmo. others August nicely. great Venmo, Dan with Cash launched nicely of in fantastic Pay with as really, well

These Grubhub Eats. really ordering card traction, like Uber spend. – seeing of into side really are commerce we’re the type daily, see of are transactions. Venmo the and the these many So high-frequency We services seamless getting everyday food same gain – with

So more is we monetization set really It base broad initiatives Instant across about feel great the of Venmo. just Cash Out. than far

Dan Schulman

Yes. more value-added new more user seeing of base understand these we And of you’re and the that have Venmo services.

quarter-over-quarter. went increase think from to users of nice XX%, I number so a XX% the

One did remarks, mentioned thing XX% we in eBay billion growing I it’s now of his with to marketplaces. year very world, the Significantly Around in on forgot than think that last $XX the Bill at working things say alone important, is side. and are overall. larger One that I is eBay the TPV.

making and One We information, marketplace what we’re start literally with transactions solutions. to expect activation And using seller, sign to more doing eBay a click. one helping partnerships there sign in onto come of their take multiple up marketplace, PayPal. all seller is allows seller, say one up an almost for a Touch those touch, sellers marketplaces like This sell that

average and about – so of that, with increase, three at their do times. least And when sales an sellers PayPal,

overall, help of So these these businesses capabilities. a both drive with can we ton of outside with eBay and marketplace eBay, small capabilities we and of through certainly think growth new kinds especially

James Faucette

very Great, much. thanks

Dan Schulman

Yes.

bet. You

Operator

from next Terry the And question Sachs. with comes you. line of Goldman Thank our Heath

Your is now open. line

Heath Terry

Great, thank you.

a but year, lot been obviously just over and there’s So quarter of little the around of actives deeper. wanted to in that new bit dig course the the net a the into added discussion

something? correct if free activity, to net quantify assumption, a feel there these new off level kind of among alternatively, of this base Or users, what look average is these that user? that but sales wrong any see level actives or activity way like increase number in like at you of the the activity will reach same-store a start of among existing me the and to Assuming, lower is TPV the when assuming users your

Bill Ready

number increased each cohorts? the we each quarter, they of you’re net what that the do is less new deterioration element, actives, see significantly have accelerated as they how comes and of we more terms those great this new the stronger cohorts of I asking onto last of related Are than often get of A mitigate one in some the that mature number they slowly? mature question a mature, as any on Hi, have related is in look which engage platform is Bill. of will active? and actives coming cohort, that is And think each how time. see new Do we over we quality at we net of those cohorts how the things they we the those even

you cohorts, products and cohort as Oftentimes, on large us largely detail on cohorts So growth engagement is while new engagement, the as set to with more even user each quality a cohorts also diminishing a level larger dilutive engagement. we we’ve which and as gotten you’re see cohorts, still influx maturation really of having the past, actually of net engagement than rather we to those those and over getting larger larger the it cohorts, larger have we’re an from the improving bring asking more even to you because you products being see through of get don’t is why of of see stronger out time. actives the of about, than will we new expanded break part strong years because effect

Dan Schulman

right, almost question net they've We won't is that small, you is math because done transactions bring actives one. on you for very million the your in a But the you, throughout new when XX do good of the brought obviously quarter, but number quarter. them the on

base a growth effect engagement it's your overall to of the scores. So dilutive

that So it's because of of because than just – obviously that math higher numbers that. the that around we report

increase And so show that's kind we're pleased in to why steady of engagement. so a

So at X% X% last quarter, I believe, quarter. this

And so even as a you're amount. seeing steadying seeing that you're increase, substantial

creep percent start see that normalizes, engagement. to you'll that that As up

Heath Terry

Thank Bill. Dan. Thanks, Great. you,

Dan Schulman

Yes.

bet. You

Operator

next our And of the you. from with comes MoffettNathanson. Ellis Lisa Thank line question

open. now is line Your

Lisa Ellis

guys. afternoon, Hi, good

Dan Schulman

Lisa. Hello,

Lisa Ellis

the How about do PayPal I'll sense Wix to would these the you would actually about more more Hi. of be Or make mean, your role or be frenemies? players to and think creeping like the to about that partner? to group? marketplaces. Shopify e-comm they you starting with one noise wanted think enablement in this do players? other I is some Bill. views some How prepared payments. those of players, playing are direct make like, more around they PayPal to around I remarks are that into ask that candidates Because it role specifically those commented acquisition potential are like you

Bill Ready

enablement these with bundling their we help payments many that those And players. to make be would players. We they're a a of closely working very into branded payments of range oftentimes as even them happen meaningful offerings, for partner with are of that ecommerce in part PayPal wide

conversion really across businesses these relative The conversion differences small context industry cater out even particularly business already the the shine something of versus brings trust competitors further a that platforms. buyer and businesses for PayPal to that to types our PayPal can rely else Given of small the and rate small upon the where apart.

strong small were talking efforts sell. that to And to So into forums think our with have partnerships we to get the there. what really we businesses all really to I tend ties about best

about been we've deceleration think, talking a the I of lot eBay.

things the last one places of would have to that happened to had or places PayPal small now that many many sell the places businesses connecting sell. a they is a the only many, businesses to One those sell. is of ago, small has couple have that over decade decade, And

than be some enablement ecommerce helping other those Some each may those platforms to you marketplaces, more like to why already very about eBay is mentioned, the volume businesses business of partners which overall some to across and vertical larger of those connect $XX year-on-year. some much the might eBay offerings. marketplace that XX%-plus small and all growing outside sell, ones places in that's specific when talk of maybe at of our of billion-plus of that best But we're we be

marketplaces, finding places provider lots these preferred rapid are businesses of platforms. those enablement So small businesses a be to connect great small we other sell to or to like tend ecommerce platforms to growth those

Lisa Ellis

those does working Terrific. merchants capital do their And – like leverage actually Would they deliver get those or platforms? or the do also capabilities. of to that services to – actually sort like like work the invoicing enable like platforms? Thank through those your directly Do you. capabilities you those look on PayPal services,

Bill Ready

can both. really be It

for those in, to see choosing connect that PayPal us of those the one oftentimes the then they aggregation coming many you for those directly of you to sell are because them platforms. platform point see in. One to that merchants to And not sell the are is things becomes each to are choosing trend merchants

more touch discovering with so And and like they're one seller there. platforms out more up, as sign new

things alleviate that One to and they small that also up, for has seller not to for to out, The up the business process. vetting the on or only most the the are trustworthy able that but a bringing figure sign not, marketplace we're marketplace know business is those difficult seller platform. pain to for trustworthy fraudulent sign points, of is to they're and their

aggregation that point an So business. small we become for

with marketplaces other services platforms. enablement ecommerce And were those to partner able or some of

the aggregation those point we are of digital directly them many of since across those for Some merchant, channels. an provide marketplaces we to and

Lisa Ellis

Thank you. Terrific.

Bill Ready

Thanks, Lisa.

Operator

Thank you. question Cowen. And last our with from George the Mihalos comes line of

open. now is line Your

George Mihalos

Hey good afternoon. guys,

as surface, with we reiterating of there? outside on business that core secondly, it. I'm growth you're to ask profitability the this clarification. the way point next of is rate? sort that sort then from to business the is of Is wanted Just say if else or run the FX. the year, plus the think the and at appears accelerating rate, another run of at point eBay the million John, the here? for anything is that you're look that and to we think black there there's about now of say you you. just right this can of $XXX And in as if anything then of Venmo in Thank so segment hit lower guide right curious, it added But just absorbing, about it a that

John Rainey

This of with Venmo speak question made yet. color providing in in No, take second monetizing in year. way. profitability going black any something we good not how a Prior to to it's I'm before of of with is I you Venmo to be George, service in internally. first to this Sure. about our weren't of we're and the that then don't want any to that. the business. you. part your not I give this we is think the monetizing but we do, effectively some one go question can specific And we've And some we progress that great terms back

more And first of get to with the from perhaps type Venmo with pedal or and were to done two, do profitability is something next doing. And services. of for happen losses that's this And so we us the volume in but breakeven see there's foot us And to other of priority and put some platform growing is for third grew. not and a loss phase rate our that. really what PayPal The that the that in growing. or next as the then sight that's same stop to the on our line that phase was to to of quarter the we've we're going

the that's performance, to now. we it's today. are So are But and right, with guide, where that black not, we strong seeing the With the no, right in business. with XXXX respect core you're really

hold. partnerships. pretty a have pretty launched those that also that on yes, about we're early promise are and – And excited we've We products new the

with can goes this broad of complete talked that I'm mention And so be months what's our rewiring a is lot is not ago team that there's cost. and just the every marginal the done having team our back a us because the remiss effort area volume. aspect This There's effort. to across side Also, board, more low point line necessarily company. from of I XX staff our very there. grow being really XX our business opportunity to began to CFO, Bill's a a that side, revenue growth on expense volume the to but a teams teams, did to even the And commercial side. not group of teams, across we again, a grow growing about one at doing not to. functions good in The an allow are And where costs that I'd job

And to for shareholder continuing a where significant so, hope earnings growth of XXXX investors. have like to and share per with growth create you're did we a lot our we year seeing and value another revenue that, in

Dan Schulman

We with speaking time and we to of look Great. all Well, forward us. for Thanks joining soon. thanks again appreciate again. everybody you your

Operator

may for Ladies program and gentlemen, in afternoon. conference. participating conclude the thank all you great Everyone, disconnect. does and This today's a you have