PayPal (PYPL) Q1 2026 earnings summary

Executive summary

• Net revenues for Q1 2026 grew 7% year-over-year to $8.35–$8.4 billion, driven by 11% growth in total payment volume (TPV) to $463.96–$464.0 billion, with strong contributions from Venmo, branded checkout, and PSP segments.

• New CEO outlined a transformation plan focused on accelerating growth, improving profitability, modernizing technology, and driving AI adoption, with a renewed emphasis on consumer engagement and operational simplification.

• Company reorganized into three core businesses: checkout, consumer financial services (including Venmo), and payment services (including Braintree and crypto), aiming to accelerate innovation and execution.

• Active accounts reached 439 million, up 1% year-over-year, with Venmo engagement driving growth.

• Net income declined 14% year-over-year to $1.11 billion, with diluted EPS of $1.21, reflecting lower operating income and net losses on strategic investments.

Financial highlights

• Total payment volume (TPV) reached $463.96–$464.0 billion, up 11% year-over-year (8% FXN).

• Revenue grew 7% year-over-year (5% FXN) to $8.35–$8.4 billion.

• Transaction margin dollars (ex-interest) grew 3% to $3.8 billion; non-GAAP EPS up 1% to $1.34.

• Adjusted free cash flow was $1.7–$1.72 billion for the quarter, up 25% year-over-year.

• Share repurchases totaled $1.5 billion in Q1, with $6 billion returned to shareholders over the last 12 months.

Outlook and guidance

• Full-year 2026 guidance reiterated: transaction margin dollars expected to be flat or slightly down (ex-interest), non-GAAP EPS ranging from slightly negative to slightly positive, and mid-single digit decline in GAAP EPS.

• $6 billion in share repurchases and at least $6 billion in adjusted free cash flow expected for the year.

• Q2 guidance: low single-digit revenue growth, 2–3% decline in transaction margin dollars, non-GAAP EPS down high-single digits.

• Cost savings of at least $1.5 billion targeted over 2–3 years, primarily from organizational realignment and AI-driven automation.