PayPal Raises Annual Profit Forecast — Quarterly Revenue Falls Short of Expectations

PayPal posted better-than-expected profit in the third quarter and raised its 2026 earnings forecast, though the company's revenue fell short of market expectations. Following the announcement, PayPal shares fell 0.3% in pre-market trading.

The company's adjusted earnings per share (EPS) came in at $1.45, surpassing the $1.31 forecast by analysts. Revenue totaled $8.58 billion — a 2% year-over-year increase, though growth was only 1% when excluding the impact of currency exchange rate changes. Analysts had expected revenue of $8.71 billion.

Transaction revenue rose 2.5% to reach $7.71 billion, while revenue from value-added services declined 2.5% to $873 million.

By region, net revenue in the US grew 5.2% to reach $5 billion. In international markets, the figure declined 2.2% to $3.58 billion. Transaction margin revenue increased 2% to $3.95 billion.

The company's total payment volume grew 6.3% to reach $487.14 billion, while the number of transactions increased 7.3% to 6.8 billion. The number of active customer accounts grew 0.5% to 440 million.

PayPal's adjusted operating income grew 2.9% to reach $1.61 billion. Adjusted operating margin improved from 18.6% in the prior year to 18.8%. Over the same period, the company's total operating expenses rose 4.1% to reach $7.18 billion. Adjusted free cash flow, however, declined from $2.28 billion last year to $2.05 billion.

"I'm pleased with our third-quarter results and the positive momentum we're seeing in the business. We're raising our full-year guidance for transaction margin revenue and earnings," said company CEO Enrique Lores.

According to the updated forecast, PayPal expects adjusted earnings per share of $5.60 for 2026, up from its previous forecast of $5.38. The new estimate also exceeds the analyst forecast of $5.39.

The company also raised its full-year transaction margin revenue forecast — from approximately $15.6 billion to $15.7 billion. Meanwhile, it left its capital expenditure forecast unchanged at approximately $1 billion.