Paypal's Profit Surges on Growth in Transactions and New Users
PayPal Holdings Inc.'s quarterly revenue and profit jumped, beating analysts' estimates, as the company added customers and processed more digital payments.
Shares of PayPal, spun off from eBay Inc. last year, were up 2 percent at $40.90 in extended trading on Wednesday.
PayPal, which is facing increasing competition from rival digital payment services by Apple Inc., Samsung Electronics Co. Ltd. and Square Inc., is tying up with retailers, airlines and other companies to drive growth.
PayPal's active accounts rose 11.5 percent to 184 million in the first quarter, topping the average analyst estimate of 182.8 million, according to research firm FactSet StreetAccount.
Total payment volumes surged 28.6 percent to $81.06 billion.
"The company's growth is just very consistent above the market growth rate," Susquehanna Financial Group analyst James Friedman said.
PayPal processed 1.41 billion transactions in the quarter, slightly higher than the average estimate of 1.39 billion.
The company said it was seeing strong growth in its Venmo platform, which allows person-to-person payments.
"We are on track to expand to more merchants and open the service to our full Venmo customer base in the second half of this year," Chief Executive Daniel Schulman said on a post-earnings conference call.
PayPal's total revenue rose 19 percent to $2.54 billion in the quarter ended March 31, while net income jumped 43 percent to $365 million, or 30 cents per share.
Excluding items, the company earned 37 cents per share.
Analysts on average had expected a profit of 35 cents per share and revenue of $2.50 billion, according to Thomson Reuters I/B/E/S.
(Reporting by Narottam Medhora in Bengaluru; Editing by Kirti Pandey)