PYPL Stock Falls On Weak Guidance Even As Earnings Beat

PayPal Holdings (PYPL) on Thursday reported September-quarter earnings that topped analyst estimates as cost-cutting moves kicked in. PYPL stock tumbled as payment volume missed expectations and revenue guidance came in below views.

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PayPal earnings for the quarter ended Sept. 30 were $1.08 per share on an adjusted basis, down 2% from a year earlier. The e-commerce company said revenue rose 11% to $6.85 billion.

PYPL stock analysts expected earnings of 96 cents a share on revenue of $6.81 billion. A year earlier, PayPal earned $1.11 a share on sales of $6.18 billion.

Total payment volume processed from merchant customers climbed 9% to $337 billion. Analysts had projected total payment volume of $344.66 billion.

For the current quarter ending in December, PayPal forecast earnings of $1.19 a share on revenue of $7.37 billion amid headwinds from currency exchange rates. Analysts had predicted earnings of $1.18 a share on revenue of $7.73 billion.

PYPL stock plunged 9.8% to near 69 in extended trading on the stock market today.

PYPL Stock: Activist Investor Takes Stake

As e-commerce boomed during the coronavirus pandemic, shares in PayPal soared. But PayPal stock has plunged from an all-time high of 310.16 on July 26, 2021.

Activist investor Elliott Management in July disclosed that it has taken a $2 billion stake in San Jose, Calif.-based PayPal. The e-commerce firm in August added $15 billion to its repurchase program of PYPL stock. PayPal bought $939 million of its own stock in the third quarter.

PayPal holds a Relative Strength Rating of only 22 out of a best-possible 99, according to IBD Stock Checkup. PYPL stock has retreated 59% in 2022.

Former parent eBay (EBAY), which spun off PayPal in 2015, has shifted its payment processing from PayPal to Netherlands-based Adyen.

Follow Reinhardt Krause on Twitter @reinhardtk_tech for updates on 5G wireless, artificial intelligence, cybersecurity and cloud computing.

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