PYPL US S&P 500NASDAQ-100Russell 1000 Earnings call · transcribed from the recording
PayPal (PYPL) · Q3 2026 results and valuation
Share price: $59.48 · 2026-11-11
PayPal provides digital payment solutions, including online and in-person transaction processing, digital wallets, and money transfer services. The company serves consumers and merchants across approximately 200 markets globally. Its products include payment processing, business financing, and tools for managing personal finances and cryptocurrencies. Source: 10-K annual report (2026-02-03)
Results Q3 2026 vs Q2 2026 · previous quarter · published 27 Oct 2026 and 28 Jul 2026
Net income down 2.8% on the previous quarter, guidance raised. Management sounded very upbeat, in its script and in answers to analysts.
Only a basic analysis is available for this company at the moment.
1 · Numbers
−2.8%
Net income vs Q2 2026
Guidance raised
Net income 1.07B vs 1.10B
Revenue −1.1%
2 · How management spoke
Very upbeat
More upbeat than 92% of company calls
Answers to analysts: very upbeat, in line with the script.
Similar to last call.
3 · What stood out
Figure
The Venmo debit card reached 6.7 million monthly active accounts.
Valuation
Is PayPal undervalued?
Reverse DCF. Free cash flow from the last full fiscal year (2025-12-31), grown for 10 years, discounted back, plus a terminal value. “Implied growth” is the rate the current price assumes.
At 6.4% growth a year (3-year revenue growth), the model's fair value is $114.72 a share — the stock trades 48% below it. Today's price assumes −2.7% growth a year.
Current price
$59.48
close of 2026-11-11
Market implies growth of iThe yearly free-cash-flow growth, for the next 10 years, that today’s share price already assumes. If you believe the company grows faster than this, the stock is cheap under this model; slower, and it is expensive.
-2.7% for 10 yrs
Fair value / share
$114.72
Buy below
$86.04
Price vs fair value
Undervalued 48%
Price vs buy-below price
Undervalued 31%
Read between the lines
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Guidance ↑
PayPal remains on track to achieve at least $1.5 billion in gross run rate cost savings over the next two to three years and are increasing its expectations...
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Guidance
PayPal expects financial services, Venmo and payment services to contribute a significantly greater share of transaction margin dollar growth over time, with each growing double digits.
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Fading
PayPal's strategy across its 3 businesses and progress on its cost savings In today's update, I will cover the highlights on the second quarter.
Source quote
“Our strategy across our 3 businesses and progress on our cost savings In today's update, I will cover the highlights on the second quarter. Let me begin with some highlights from a good second quarter.”
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Last period
The drivers of PayPal's year-over-year transaction margin dollar growth were broad-based.
Source quote
“The drivers of our year-over-year transaction margin dollar growth were broad-based. Transaction margin dollars excluding interest on customer balances grew 3%. From a product lens, drivers included Venmo monetization, continued strong credit performance and Braintree improvement.”
Tone
How upbeat the language was, compared with other companiesiTone counts positive minus negative finance words, adjusted for length. Executives mostly speak positively, so the labels compare each call with every company's latest call: “typical” is the middle third, “very upbeat” the top tenth, “cautious” the bottom tenth.. Dot: Q3 2026. Ring: Q2 2026.
Script and answers carried a similar tone, so the script's message held up under questioning.
Sentences that drove the tone
“Braintree's TPV grew 10%, supported by profitable front book wins, high retention, and expansion with existing merchants.”
“And the momentum extends beyond pay later, with strong growth across consumer offerings like credit, debit, and tap-to-pay, as well as merchant lending.”
“As we've shared, we intend to reinvest a significant portion of these savings into our highest priority growth initiatives while improving operating leverage over time.”
Full figures
USD · SEC EDGAR XBRL (10-Q, period end 2026-09-30)
| Metric | Q3 2026period end 2026-09-30 | Q2 2026period end 2026-06-30 | Change | Q3 2025 | YoY |
|---|---|---|---|---|---|
| Revenue | 8.58B | 8.68B | −1.1% | 8.42B | +2.0% |
| Operating income | 1.40B | 1.43B | −1.8% | 1.52B | −7.8% |
| Net income | 1.07B | 1.10B | −2.8% | 1.25B | −14.0% |
| EPS | 1.25 | 1.25 | ±0% | 1.30 | −3.8% |
| P/E today 10.7 | 8.5 | 10.8 | −2.3 | 14.7 | −6.2 |
Topics
Most discussed now
- Financial services expand PayPal's total addressable market, deepen customer relationships, increase lifetime value, and allow us to become…
- I will discuss PayPal's third quarter progress, its multiple growth engines across PayPal, and how its work on cost,...
- The savings are creating capacity to self-fund more of PayPal's growth investments, such as improving the consumer experience…
- As PayPal communicated in September, the removal of the EU de minimis tax exemption impacted select merchants and created about...
Faded since Q2 2026
- Fading PayPal also generated strong free cash flow, providing flexibility to continue investing in the business while returning capital to…
- Fading Based on the progress to date, PayPal is confident that greater strategic clarity underpinned by sharper execution and a leaner...
- Fading Big change is doubling down on PayPal's growing businesses, Venmo and PSP.
- Fading In the case of PSP, by expanding the portfolio of value-added services and increasing the attach rate, and PayPal is...
Latest announcements
Official filings, newest first. Summaries are generated from each filing and its attachment; every figure is checked against the source.
- Results of operations · SEC 8-K
PayPal reported net revenues of $8.6 billion, up 2% year-over-year, and non-GAAP EPS of $1.45, up 8% compared to the previous year.
- Results of operations · SEC 8-K
PayPal Holdings, Inc. issued a press release on July 28, 2026, announcing its financial results for the quarter ended June 30, 2026.
- Director or officer change; Shareholder vote results · SEC 8-K
Diego Scotti will cease as EVP, General Manager, Consumer Group on June 2, 2026, and stockholders approved the 2026 Equity Incentive Award Plan authorizing up to 39,100,000 new shares.
- Other events · SEC 8-K
PayPal Holdings, Inc. issued and sold $2.0 billion in senior notes on May 15, 2026, consisting of notes due in 2028, 2031, and 2036.
- Results of operations · SEC 8-K
PayPal Holdings, Inc. issued a press release on May 5, 2026, announcing its financial results for the quarter ended March 31, 2026.
- Director or officer change; Regulation FD disclosure · SEC 8-K
PayPal announced a strategic reorganization into a three-business operating model and appointed several new executives, including a Chief AI Transformation & Simplification Officer.
- Director or officer change · SEC 8-K
PayPal Holdings, Inc. appointed Alyssa H. Henry to the Board of Directors and the Compensation and Risk and Compliance Committees effective March 25, 2026, following the announcement of Gail J. McGovern's retirement.
- Director or officer change; Regulation FD disclosure · SEC 8-K
PayPal appointed Enrique Lores as President and CEO effective March 1, 2026, with an annual base salary of $1,450,000 and a target bonus of 200% of that base.
Balance sheet & ownership
From SEC filings; short interest is FINRA data via Yahoo. Collected 2026-10-19.
Cash & runway
Cash & equivalents
$6.98B
2026-03-31
Short-term investments
$2.37B
Long-term investments
$4.12B
total liquidity $13.47B
Implied runway
—
operating cash flow positive over the TTM window
Dilution
weighted-average basic shares, per quarter. Change: -7.4% YoY.
| Quarter | Shares |
|---|---|
| Q2 2024 | 1.04B |
| Q3 2024 | 1.01B |
| Q1 2025 | 986.0M |
| Q2 2025 | 969.0M |
| Q3 2025 | 950.0M |
| Q1 2026 | 913.0M |
Insider transactions
Form 4 open-market trades (codes S/P), trailing 12 months. Coverage: newest 50 of 85 filings; 50 filings parsed.
Sold by insiders
39.5K shares
$2.0M · 19 transactions
Bought by insiders
6.1K shares
$254.5K · 1 transactions
Net direction
net selling
Catalyst calendar
management-stated targets — from the latest earnings call; plans, not promises.
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the second half of the year
momentum from investments to deepen customer engagement and increased lifetime value
Source quote
“These investments are already underway with momentum expecting to build in the second half of 2027 and continue throughout 2028 as new capabilities, scale across the platform.”
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2027
continuation of work strengthening the fundamentals across the business
Source quote
“We have already begun strengthening the fundamentals across our business, focused on the changes I just outlined, and this work will continue into 2027.”
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2028 and beyond
next generation innovations such as agentic payments and digital identity becoming meaningful contributors
Source quote
“Looking to 2028 and beyond, we expect our next generation innovations such as agentic payments and digital identity to become increasingly meaningful contributors to our business.”
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over the next 2 to 3 years
delivery of cost savings
Source quote
“We are making good progress on our plan to deliver at least [indiscernible] savings over the next 2 to 3 years.”
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this year
removal of 3 organization and layers and increased spans of control
Source quote
“We are on track to remove 3 organization and layers across the company, and increased spans of control this year.”