PayPal Beats Q3 EPS on Venmo Growth, Raises Full-Year Forecast Amid Revenue Miss and Modest Stock Move

PYPL reported third-quarter 2026 adjusted earnings of $1.45 per share on Tuesday, up 8% from a year earlier and $0.14 above the $1.31 consensus, a 10.7% surprise. Revenue rose 2% to $8.58 billion (1% currency-neutral), short of the $8.71 billion analysts expected. On a GAAP basis, earnings per share fell 4% to $1.25, according to the company's earnings release.

Venmo carried the quarter. Its total payment volume grew 14% year over year to $96.81 billion, about 20% of PayPal's $487.1 billion total, which rose 6%. Branded checkout, the PayPal button merchants place on their own sites, grew just 1% on a currency-neutral basis, the fourth straight quarter in the 1-2% range. Transaction margin dollars, the company's main gross-profit measure, rose 2% to $3.95 billion.

PayPal raised its full-year adjusted EPS guidance to about $5.60 from about $5.38 and lifted its transaction margin forecast to about $15.7 billion from about $15.6 billion. For the fourth quarter it guided to adjusted EPS of about $1.43, above the $1.35 consensus. Part of the per-share growth comes from a shrinking share count: the company repurchased $1.5 billion of stock in the quarter and $6 billion over the past twelve months, and diluted weighted shares fell to 858 million from 960 million a year earlier, per the release.

The reaction was muted for a beat-and-raise. Shares traded about 2.6% lower before the open, were up about 1.2% in early trading, and closed up 2.0% at $56.09. What to watch: whether branded checkout growth picks up from the 1% pace, how much of next year's per-share growth comes from buybacks rather than transaction margin, and whether Venmo keeps widening its share of total volume.