PayPal (PYPL) Turnover Q1 Beat, Revenues Missed Estimates

<p class = "canvas-atom canvas-text Mb (1.0em) Mb (0) – sm Mt (0.8em) – sm" type = "text" content = "PayPal Holdings, Inc. In the first quarter of 2019, PYPL posted a non-GAAP earnings of 78 cents per share, 11 cents lower than Zacks' consensus estimate and 37% higher year-over-year. former.

The company's strategic investment in Mercado Libre MELI was a key catalyst throughout the quarter, as evidenced by its contribution of 8 cents to earnings per share.

Net revenues of $ 4.128 billion, missed the Zacks consensus estimate of $ 4.129 billion. However, this figure increased by 12% compared to the quarter of the previous year.

Year-over-year revenue growth can be attributed to the rapid increase in the number of new active accounts and increased customer engagement on the company's platform, which has significantly boosted revenue growth. all active accounts for the current quarter. In addition, the robust performance of Venmo and One Touch continued to contribute well to revenues.

However, the sale of the US consumer receivables portfolio to Synchrony had a negative impact on revenues. Without impact, revenues would have grown 19%.

Regarding price performance, PayPal grew by 44.8% in one year, outperforming the sector's 21.9% increase. "Data-reactid =" 11 ">PayPal Holdings, Inc. In the first quarter of 2019, PYPL posted a non-GAAP earnings of 78 cents per share, 11 cents lower than Zacks' consensus estimate and 37% higher year-over-year. former.

The company's strategic investment in Mercado Libre MELI was a key catalyst throughout the quarter, as evidenced by its contribution of 8 cents to earnings per share.

Net revenues of $ 4.128 billion, missed the Zacks consensus estimate of $ 4.129 billion. However, this figure increased by 12% compared to the quarter of the previous year.

Year-over-year revenue growth can be attributed to the rapid increase in the number of new active accounts and increased customer engagement on the company's platform, which has significantly boosted revenue growth. all active accounts for the current quarter. In addition, the robust performance of Venmo and One Touch continued to contribute well to revenues.

However, the sale of the US consumer receivables portfolio to Synchrony had a negative impact on revenues. Without impact, revenues would have grown 19%.

Regarding price performance, PayPal grew by 44.8% in one year, outperforming the sector's 21.9% increase.

Top Line in detail

By type: Trading revenues were $ 3.731 billion (90.4% of net revenues), up 17% from the same quarter of the previous year. Other value-added services generated revenues of $ 397 million (representing 9.6% of net revenues), down 18.6% from one year to the other. This decline can be attributed to the sale to Synchrony of its consumer credit portfolio in the United States.

By geography: Revenue from the United States was $ 2.187 billion (53% of net revenues), up 8.1% year-on-year. International revenues reached $ 1.941 billion (47% of revenues), up 17% from the same quarter of the previous year.

Neighborhood in detail

Strategic partnerships and the strength of PayPal's wallet continued to strengthen the customer base and merchant base in the current quarter, which contributed to its total payment volume (TPV).

During the first quarter, the company revealed a partnership with Facebook's FB Instagram. Depending on the transaction, he will process the payment infrastructure at his checkout counter on Instagram.

In addition, PayPal has invested $ 750 million in MercadoLibre to enter the e-commerce space. In addition, this initiative strengthens the international presence of the company.

In addition, PayPal unveiled Instant Transfer in collaboration with JPMorgan Chase. This solution provides consumers and merchants with real-time payments, enabling PayPal customers to seamlessly access their money.

In addition, the company's efforts to monetize Venmo remained positive throughout the quarter. Annual product revenue exceeded $ 300 million in the first quarter.

Key measures to consider

Supported by these efforts, the company recorded annual growth of 17% in the total number of active accounts, as well as 9.3 million new net asset accounts in the quarter. The total number of active accounts was 277 million during the quarter, 274 million less than the Zacks consensus. Venmo remains a key growth driver to this extent with more than 40 million active customers.

In addition, the total number of payment transactions reached 2.84 billion euros, up 28.2% year-on-year. This figure exceeded the Zacks consensus estimate of 2.82 billion.

In addition, the active company-to-user payment transactions amounted to € 37.9 million, an increase of 9.2% compared to the same quarter of the previous year. This figure was lower than the Zacks consensus, estimated at 38.2 million.

TPV reached $ 161.5 billion for the quarter published, posting annual growth of 22% and 25% based on spot rates and neutral currencies, respectively. However, this figure was not reached in Zacks' consensus estimate of $ 162.9 billion. The volume of eBay eBay, down 4%, remains worrying. In addition, it accounted for 9.7% of the total weighted volume, falling by 300 basis points from the same quarter of the previous year.

Nevertheless, Venmo, which accounted for $ 21 billion in POS, jumped 73% year-over-year, thanks to its strong performance. In addition, the growing dynamism of the main peer-to-peer (P2P) also generated a contribution of $ 42 billion, up 41% from the same quarter of the previous year. In addition, the volume of market services, up 29%, offset the decline in eBay's contribution in the current quarter.

In addition, mobile payments accounted for more than $ 66 billion of POS, mainly driven by One Touch's strong mobile payment services, which had 12.1 million merchants and 136 million customers by the end of the first quarter.

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