PayPal started the year on strong financial footing, reporting higher-than-expected first-quarter earnings and sticking to its full-year profit forecast. The digital payments company posted solid results while navigating an uncertain trade backdrop and competitive pressure from tech giants.
Under the leadership of CEO Alex Chriss—who stepped in late last year—PayPal is pulling back from growth-at-any-cost tactics and focusing on profitability through smarter execution.
“We had a great start to the year and our strategy is working,” Chriss said. “This is our fifth straight quarter of profitable growth.”
Earnings Top Expectations as Spending Cuts Pay Off
For the first three months of 2025, PayPal reported adjusted earnings of $1.33 per share, beating analysts’ projections of $1.16. Revenue inched up to $7.79 billion, while total payment volume rose 4%.
Behind the numbers, a sharper focus on cost control played a big role. The company cut operating expenses by 4%, bringing them down to $6.26 billion. These savings are being redirected toward automation, product enhancements, and more targeted investments.
This financial discipline has helped PayPal maintain its profit guidance for the full year, aiming for adjusted earnings between $4.95 and $5.10 per share—even as trade tensions continue to create business uncertainty.
Branded Checkout Shows Momentum as New Features Roll Out
One of PayPal’s biggest priorities remains its branded checkout services, which include the PayPal wallet and Venmo. This area has been under pressure from competitors like Apple and Google, but the latest results show signs of improvement.
In Q1, branded checkout volume rose 6%, excluding the impact of leap year timing—slightly better than last year’s 5% gain.
PayPal is also launching updates to its checkout platform, including Fastlane, a new guest checkout experience designed to make online payments faster and more seamless. The company says the improved interface is already showing better user engagement and higher merchant satisfaction.
Venmo Still Growing, But Monetization Takes Time
While Venmo remains a widely used app, its ability to generate revenue has lagged. PayPal is working to change that by pushing Venmo further into business transactions and e-commerce.
Upcoming updates are expected to help small businesses accept payments through Venmo and allow the app to handle more recurring transactions, such as subscriptions or service-based invoices.
The goal, according to company insiders, is to turn Venmo into more than just a peer-to-peer payment tool and make it a dependable revenue stream over the long term.
Investor Pressure Persists Despite Strong Start
Even with a solid quarter in the books, PayPal’s stock dipped 1% in pre-market trading and is down 24% since the start of the year. Much of that pressure comes from concerns about slowing branded growth and the increasing reach of Apple Pay and Google Pay.
Still, some analysts say PayPal is finally finding its footing. The company is avoiding major risks and instead tightening up operations, improving product experience, and aiming for more consistent performance.
“We’re not chasing quick wins anymore,” said one person close to the leadership team. “This is about fixing what matters, not just adding features.”
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