PayPal (PYPL) Q1 revenue

PayPal Although it reported better revenue than expected for the first quarter, the company missed revenue and reaffirmed its 2025 guidance due to macro uncertainty. Stocks fell by more than 3% in pre-market trading.

Here’s how the company compared it to Wall Street estimates based on analyst research by LSEG:

Earnings per share: $1.33, adjusted vs. $1.16 forecast: $77.9 billion vs. $7.755 billion

Although revenues rose just 1% from $7.7 billion a year ago, PayPal said the results reflect a strategy that prioritizes profitability over volume and will deploy a lower margin of revenue stream.

The company’s key measure of profitability, trading margin dollars rose 7% to $3.7 billion, marking its fifth consecutive quarter of profitable growth under CEO Alex Chriss.

Total payments show how digital payments are being made in the broader economy, missing estimates, appearing at $417.2 billion, predicted by analysts at nearly $418 billion. The number of active accounts rose 2% from the previous year to 436 million.

Venmo’s revenues rose 20% year-on-year, but the company did not provide dollar figures. Venmo’s total payments increased by 10% to $75.9 billion. Venmo transactions volume rose 50% in the quarter, with approximately 40% of monthly active users of Venmo debit cards.

Chriss focuses on monetizing major acquisitions such as Braintree and Venmo. doordash, Starbucks Ticketmaster is also one of the companies that accepts Venmo as one way consumers can pay.

Prior to PayPal’s revenue report, some analysts were cautiously speaking, despite the company’s focus on expanding margins. Analysts at Morgan Stanley warned in a memo on Monday that investors’ sentiment remains bearish due to the potential impact of tariffs and competitive pressures. apple and Shopifyand the risk of long-term slowdown in growth of branded checkouts.

Jefferies analysts highlighted PayPal’s cross-China border exposure as a new risk associated with potential new tariffs and changes to the DE Minimis exemption.

In the second quarter, PayPal issued better than expected guidance, forecasting adjusted earnings of $1.29 to $1.31 per share, with average analyst estimates above $1.21. The dollar in trading margin will increase by 4% to 5% to $3.75 billion to $3.8 billion, the company said.

However, over the year, PayPal chose to reaffirm its guidance by citing “global macroeconomic uncertainty.” The company expects annual earnings per share to range from $4.95 to $5.10 and free cash flows to $6 to $7 billion.

PayPal stocks fell 24% this year, while NASDAQ fell 10%.

Watch: PayPal’s crypto lead to enable merchants to buy and sell virtual assets