Schulman said that many people have dozens of apps on their phones but that it can be time consuming to make sure they’re up to date with all of a person’s payment instruments. PayPal aims to be a “super-app,” a term used to describe platforms like AliPay in China that bring in varied money-related capabilities. The company also envisions its app as a shopping hub, where people can build wish lists, earn rewards, monitor prices and connect with merchants through personalized offers. Schulman said during the presentation that he expects to see a “new financial system emerge” that PayPal can help shape through a focus on moving money more quickly, expanding access to financial services, and bringing together “formerly disparate capabilities.” Opportunities for PayPal include investment capabilities, bill-payment tools and high-yield savings accounts, he said. PayPal executives spent the investor-day presentation outlining the expanded role that the company could play in financial services by turning the company’s app into a hub for various financial tools. “Having said that, management did in fact guide for accelerating organic revenue growth (diminishing eBay impact, user engagement expansion) from 16% to 20%,” he told MarketWatch.īarclays analyst Ramsey El-Assal wrote that “there are very few ~$330 billion market-cap companies growing revenues and/or EPS at or above 20% annually.” PayPal forecasted a 20% compound annual growth rate for revenue and a 22% CAGR for earnings per share, but Katri said that Wall Street was looking for a low-20% level revenue target and a mid-20% EPS target.
While shares were up as much as 6.7% earlier in Thursday’s session, they finished the day up 0.7%, which Wedbush analyst Moshe Katri suspected was related to a “conservative” financial forecast. The company expects that its total payment volume could hit $2.8 trillion in 2025, roughly triple its 2020 total. That would bring the company’s compound annual growth rate up to 20% over the next five years, compared with 18% over the past five years. PayPal also is targeting $50 billion in revenue in 2025, according to Chief Financial Officer John Rainey, up from $21.5 billion in 2020.
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