PayPal boosts 2024 earnings and buyback guidance after strong Q2 beat.

PayPal Holdings (NASDAQ:PYPL) stock jumped 4.9% in Tuesday premarket trading after the payments tech company turned in stronger-than-expected Q2 earnings and revenue, boosted its 2024 earnings guidance, and raised its share repurchase outlook.

“We delivered our best transaction margin dollar growth since 2021, and we are making steady progress on our strategic transformation, while investing in innovation and operating more efficiently,” said CEO Alex Chriss. “Given the strength of our business, we are raising our 2024 guidance and increasing share repurchases.”

The company now expects 2024 adjusted EPS of $3.88-$3.98 compared with its previous guidance of ~$3.83 and the average analyst estimate of $4.16.

The company now expects to buy back $6B of shares in 2024, up from its prior guidance of at least $5B.

It expects Q3 non-GAAP EPS growth in the high single digits from $0.98 in the year-ago quarter, and revenue growth in the mid-single digits from $7.42B in the prior-year period.

Q2 non-GAAP EPS of $1.19, beating the $0.99 consensus, rose from $1.08 in Q1 and $0.87.

Total active accounts stood at 429M at June 30, 2024 climbed from 427M at March 31 and the Visible Alpha estimate of 427M.

Q2 total payment volume (“TPV”) of $416.8B, vs. the Visible Alpha consensus of $418.1B, rose from $403.9B in the previous quarter and $376.5B in last year’s Q2.

Revenue of $7.89B, topping the average analyst estimate of $7.82B, climbed from $7.70B in Q1 and $7.29B in Q2 2023.

PayPal’s (PYPL) transaction margin dollars increased 8% Y/Y to $3.61B. Operating margin rose to 16.8% from 15.5% in Q2 2023.

Total operating expenses of $6.56B, higher than the Visible Alpha consensus of $6.24B, grew from $6.53B in the previous quarter and $6.15B in last year’s Q2.

Net cash provided by operating activities was $1.53B vs. $1.92B in Q1 and -$200M in Q2 2023; adjusted free cash flow of $1.14B compared with $1.86B in the prior quarter and $869M a year ago.

Conference call at 8:00 AM ET

Earlier, PayPal non-GAAP EPS of $1.19 beats by $0.20, revenue of $7.9B beats by $80M