PayPal Boosts Revenue Forecasts With New SMB Features and Partner Collaborations

If the global consumer is showing signs of cutting spending, PayPal didn’t get that email. The digital payments and peer-to-peer platform on Tuesday (July 30) posted better than expected Q2 earnings and doubled down with increased revenue estimates for the rest of 2024.

“We are continuing to innovate and create high converting experiences on both desktop and mobile and across platforms and devices,” CEO Alex Chriss said on the company’s earnings call. “We also continue engaging consumers post purchase with smart receipts, package tracking, push notifications and more, adding increased value and driving the PayPal engagement flywheel. In fact, we drove almost 20 million app logins from our post purchase experiences in June 11, growing more than 70% from a year ago.”

By the numbers, PayPal reported a total transaction volume of $403.9 billion in Q2 2024, marking an 11% year-over-year increase. PayPal’s overall net revenues rose by 8% to $7.9 billion. Venmo processed over $73 billion in total payment volume, up 8% from the previous year, with monthly active users growing by 5% to nearly 62 million. Additionally, PayPal highlighted the progress of Fastlane, now available to merchants in the U.S., which promises to enhance checkout experiences and drive higher conversion rates. Payment processor Braintree also showed increased integration with Fastlane, contributing to the company’s positive outlook. In fact, both Chriss and CFO Jamie Miller namechecked Braintree and Fastlane several times during the call, showing the importance of enabling technologies to the company’s ability to attract and retain key partners.

Those partners also took their share of the spotlight during the earnings call. For example, Chriss noted that PayPal is working closely with Meta to optimize PayPal experiences and will announce deeper commitments with it as well as Salesforce, Door Dash and others. During the second quarter PayPal launched in-app offers with Best Buy, Priceline, Lyft, Instacart, Ticketmaster, Walmart and Nordstrom.

“We continue to execute with high velocity to enhance customer experiences and value for our large enterprises, SMBs and consumers,” Chriss said. “We are building the foundation for our next phase of growth for large enterprises. We continue to have a productive conversation to help merchants understand the additional value they can unlock by strengthening their relationship with us to take advantage of our full platform capabilities.”

Chriss also addressed PayPal’s relationships with SMBs and competition with other digital wallets and payments solutions, including Apple Pay.

“We are the number one branded experience across all platforms and devices,” Chriss said during the Q&A portion of the call with Wall Street analysts. “If we narrow down into desktop web, which is still 40% to 50% of all checkout, we see no degradation in our share over the past four years. So let me say that again. We’ve held share despite competition. Second, if we look across browsers, there’s actually no difference in our selection rate across different browsers. So certain buttons moving from one platform to the other just isn’t material to us. That’s where we are today. Let’s focus around our ability to continue to improve and make this a better experience for our consumers going forward. And for merchants, they’re looking for an end-to-end solution. They want to get customers, they want to convert customers, and they want to engage and have a return experience with customers.”

Chriss made several points regarding its small business suite, PPCP. In early April, it enhanced its Complete Payments Solution for small businesses by adding new features. These include the ability to accept Apple Pay, save payment methods with PayPal Vault, and use a real-time account updater to keep card details current. Additionally, businesses can now access interchange plus plus (IC++) pricing and gross settlement options. These features aim to streamline payment processes, reduce cart abandonment, and offer transparent pricing, ultimately helping small businesses improve sales and manage cash flow.