NEW YORK — PayPal Holdings Inc. (PYPL) reported second-quarter revenue of $8.1 billion, exceeding analyst consensus of $7.8 billion by 3.8 percent. Earnings per share reached $1.52, beating estimates of $1.45. The company also raised its full-year adjusted EPS guidance to a range of $6.20 to $6.35, up from its previous forecast of $6.00 to $6.15.
The revenue beat stemmed from a 12 percent increase in total payment volume (TPV), which reached $425 billion — accelerating from the nine percent reported in the prior quarter. Strong performance in branded checkout and Venmo drove the gain.
Active accounts remained stable at 402 million, but transaction activity per account increased. Customers completed an average of 54 transactions over the past 12 months, a five percent rise year-over-year. That higher engagement contributed to a 10 percent increase in transaction revenue, totaling $7.6 billion.
Investors focused on acquisition commentary during the earnings call. CEO Alex Chriss addressed the market speculation directly, saying the company is "actively evaluating opportunities to enhance our merchant value proposition" and that discussions are "productive and ongoing."
Rumors have centered on PayPal pursuing a smaller, specialized fintech firm to strengthen its B2B payment solutions. A target with established invoicing or cross-border transaction capabilities would diversify revenue away from consumer discretionary spending — a stated priority for Chriss.
Bank of America Global Research raised its price target for PayPal to $95 from $80, maintaining a Buy rating. Analyst Jason Kupferberg cited the "disciplined approach to M&A" as a key catalyst. PayPal shares closed at $78.50, up 1.8 percent on the day.
The B2B push puts PayPal in more direct competition with Bill.com (BILL) and Square (SQ) in business services — a market growing faster than consumer payments.
Operating expenses as a percentage of revenue declined 150 basis points year-over-year, contributing to the earnings beat.
Integration risk remains the key concern for any deal, particularly in fintech. Chriss said the company is applying a "rigorous due diligence process" to any acquisition, signaling a measured pace.
PayPal projects third-quarter revenue growth of seven to eight percent. Its next earnings report is scheduled for Oct. 30, when the company expects to provide further updates on its strategic initiatives, including any acquisition.
