PayPal Holdings Inc. continued to benefit from booming e-commerce adoption during the pandemic, but shares fell in extended trading Monday after the company’s holiday-quarter earnings outlook came up light.
The company anticipates 17% to 18% growth in fourth-quarter adjusted earnings per share, which amounts to 97 cents to 98 cents. Analysts were expecting $1.07 in adjusted earnings per share.
Chief Financial Officer John Rainey said that the company’s earnings outlook reflects the timing of investment spending in the back half of 2020. “Incremental investment is more heavily weighted to Q4,” he said on PayPal’s earnings call.
PayPal topped expectations with its third-quarter earnings results, posting $1.07 in adjusted EPS, up from 76 cents a year prior and ahead of the FactSet consensus, which called for 94 cents. The company reported GAAP net income of $1.02 billion, or 86 cents a share, up from $462 million, or 39 cents a share, in the year-earlier quarter.
The company raised its EPS forecast for the full fiscal year, as it anticipates adjusted EPS growth of 27% to 28% for 2020. That’s up from a prior estimate of about 25% growth.
Want updates like this delivered weekly?
TransactionWatch is a weekly newsletter covering the most important and relevant merchant acquiring M&A activity. This first-of-its-kind newsletter was developed for the world’s cutting-edge payments executives. See an example edition.
How Do I Sign Up?
Click here to visit the TransactionWatch landing page and complete the subscription form. You will receive a confirmation email and begin to receive TransactionWatch every Friday.