PayPal Holdings Q4 Profit Rises, Tops View; Stock Up

(RTTNews) - Payments technology company PayPal Holdings Inc. (PYPL) Wednesday reported an increase in profit for the fourth quarter, as revenues grew 17 reflecting increased payment volumes and number of users. Both earnings and revenues trumped Wall Street analysts estimates, sending PayPal's shares up 5 percent in the after-hours trading.

San Jose, California-based PayPal's fourth-quarter profit rose to $367 million or $0.30 per share from $286 million or $0.23 per share last year.

Excluding one-time items, adjusted earnings rose to $0.36 per share from $0.28 per share last year. On average, 34 analysts polled by Thomson Reuters estimated earnings of $0.35 per share for the quarter. Analysts' estimates typically exclude one-time items.

PayPal's revenues for the fourth quarter grew 17 percent to $2.56 billion from $2.19 billion last year. Analysts had a consensus revenue estimate of $2.51 billion for the quarter.

Operating margin improved to 16.1 percent for the quarter from 15.9 percent in the same period last year.

In the fourth quarter, PayPal processed $82 billion in total payment volume, representing FX-neutral growth of 29 percent. The company grew its active account base by 6.6 million in the fourth quarter, ending the year with 179 million active customer accounts.

Looking ahead to the first quarter, PayPal expects adjusted earnings of $0.34 to $0.36 per share on revenues of $2.47 to $2.52 billion. Analysts currently estimate earnings of $0.35 per share on revenues of $2.48 billion for the quarter.

For the full year 2016, the company expects adjusted earnings of $1.45 to $1.50 per share and revenues of $10.5 billion to $10.7 billion. Analysts currently estimate earnings of $1.49 per share on revenues of $10.68 billion for 2016.

Further, PayPal also authorized a new share repurchase program of up to $2 billion.

PYPL closed Wednesday's trading at $31.59, down $0.38 or 1.19%, on the Nasdaq. The stock, however, rose $1.71 or 5.41% in the after-hours trading.