Despite vaccination rollouts, consumers are continuing to spend more online — a trend that is boosting growth in new users and revenue for PayPal Holdings Inc.
Within the first three months of 2021, PayPal added 14.5 million new users and saw its overall revenue increase by 29 percent to $6.03 billion, beating analyst estimates of $5.88 billion. The payments company is now upping its expectations and is predicting the platform will add a whopping 55 million new users this year.
Furthermore, PayPal witnessed total payments volume surge by 50 percent to $285 billion, beating analysts’ average estimates of $265 billion.
“Our strong first-quarter results demonstrate sustained momentum in our business as the world shifts into the digital economy,” said Dan Schulman, PayPal’s chief executive officer in a statement announcing the results.
“Our addressable market continues to grow as we launch new products and services for our 392 million active accounts.”
PayPal’s share value increased more than 4 percent to $259 after the announcement.
The news comes on the heels of the coronavirus pandemic, which has led consumers to shift their shopping behaviors online. But even with such a dramatic adoption in online shopping, investors have been skeptical about its continuance as COVID-19 vaccination rates are continuing to climb.
PayPal’s recent reports, however, indicate that online shopping is not slowing down anytime soon. PayPal expects revenue to jump by roughly 20 percent to $25.75 billion for the full year, a slight increase from 19 percent the company was originally expecting.
Additionally, PayPal’s P2P application Venmo reported a 63 percent increase in transaction volume, reaching $51 billion.