Earnings

PayPal Q3 2025 Earnings — Core Brief Summary

Core-Brief

28 Oct 2025 — 2 min read

Headline:
PayPal delivered another quarter of broad-based improvement, raised FY guidance for TM dollars and non-GAAP EPS, initiated a dividend, and leaned into BNPL, Venmo, omnichannel, and “agentic commerce” partnerships (Google, OpenAI, Perplexity).

Quarter at a glance

TPV: $458B, +7% CC (+8% spot).
Transaction margin dollars (ex-interest): +7%; diversified drivers (branded checkout, Venmo, PSP, credit).
Non-GAAP EPS: +12% YoY.
Adjusted FCF: $2.3B in Q3; $4.3B YTD.
Cash / Debt: $14.4B / $11.4B.

Engagement & scale

Monthly active accounts: 227M, +2%.
Txns per active (ex-PSP): +5%.
Branded experiences TPV: +8% CC; U.S. +10%.
Online branded checkout TPV: +5% CC (macro softness later in quarter; smaller baskets).

Growth engines

BNPL: TPV >+20%; MAAs +21%; on track for ~$40B BNPL TPV in 2025. Expanding upstream presentment, in-store (U.S. after Germany), Canada launch; longer terms in Italy/Spain (up to 24 installments).
Venmo: TPV +14% (4th straight double-digit qtr). ~66M MAAs (+7%); revenue run-rate ~$1.7B ex-interest in 2025 (>+20% YoY). Debit-card first-time users 1M in Q3; Pay with Venmo MAAs +~25%; Venmo debit actives +>40%. ARPA just over $25 with big headroom (low penetration in debit/Pay with Venmo/recurring funds).
PSP: Volume +6% (up from +2% 1H); profitable growth with value-added services (payouts, APM optimization, FXaaS).

Strategy & product

Omnichannel & biometrics: Redesigned checkout now covers ~25% of global transactions; where fully optimized + biometrics, conversion up 2–5pp.
Agentic commerce: New PayPal Agentic Commerce Services (one integration → multiple LLMs). Partnerships with Google, OpenAI (PayPal checkout in ChatGPT; PayPal processing for Instant Checkout), Perplexity.
PayPal World: Wallet interoperability pilot live.
Credit model: Further externalized short-term U.S. pay-later receivables (Blue Owl); loss rates improved q/q; Q3 included higher loss provisions tied to an August service disruption (Germany).

Capital allocation

Dividend initiated: ~10% payout of net income; complements buybacks.
Capital returns target: 70–80% of FCF (majority buybacks).
Buybacks: $1.5B in Q3; $5.7B over last 4 quarters.

Outlook & guidance

Q4’25: CC revenue mid-single digit; TM dollars $4.02–$4.12B (~+3.5% YoY; +~5% ex-interest). Expect prudent pacing due to softer baskets and macro; stepping up targeted growth investments (some contra-rev, some opex).
FY’25 raised:
- TM dollars: $15.45–$15.55B (+5–6%; +6–7% ex-interest).
- Non-GAAP EPS: $5.35–$5.39 (+15–16%).
- Adj. FCF: ~$6–7B (ex origination/sale timing for pay-later).
2026 setup: Will detail in Feb; near-term growth may be tempered by deliberate investments to “win” three secular shifts: digital wallets, BNPL, agentic commerce.