PayPal Reports 2018 Q1 Earnings

Full caveat: I have not read through the conference call and only glanced at numbers but, once again, looks like a really solid quarter. Shares are up about 3% in AH trading. From Investor’s Business Daily:

PayPal Holdings (PYPL) reported adjusted first-quarter profit and revenue that topped expectations and forecast June quarter sales above estimates, sending shares in the digital payment processor up in late trading.

PayPal said Wednesday that adjusted first-quarter earnings were 57 cents a share, up 29% from a year ago, with revenue rising 24% to $3.69 billion, topping analyst estimates. A year earlier, PayPal earned 44 cents a share on sales of $2.98 billion.

Analysts expected PayPal to report earnings of 54 cents on sales of $3.59 billion for the period ended March 30.

From https://www.investors.com/news/technology/paypal-holdings-ea…

From the earnings release:

“After a strong 2017, we entered 2018 with continued momentum. Our partner relationships in the U.S. and across the globe continue to grow and flourish. As the digital economy gathers speed, we are excited to provide new and innovative capabilities to better serve our consumer and merchant customers,” said Dan Schulman, President and CEO of PayPal.

Driven by strong mobile engagement on our platform, PayPal processed approximately $49 billion in mobile payment volume in the first quarter, representing approximately 52% growth year over year. One Touch, PayPal’s innovative checkout experience, ended the first quarter with 92 million consumers opted in. At the end of the first quarter, 8.6 million merchants offered One Touch.

See the full release at https://investor.paypal-corp.com/releasedetail.cfm?ReleaseID…

Here’s a look at the numbers:


Revenues (millions)			Q1		Q2		Q3		Q4	
2014					1874		1983		1971		2193	
2015					2137		2297		2258		2556
2016					2544		2650		2667		2981
2017					2975		3136		3239		3744
2018					3685

EPS (non-GAAP)			        Q1		Q2		Q3		Q4
2014					0.27		0.28		0.24		0.28	
2015					0.29		0.32		0.31		0.36	
2016					0.37		0.36		0.35		0.42
2017					0.44		0.46		0.46		0.55
2018					0.57

2018 Q1 Earnings (Current)

Revenue Growth (billions)
2017 Q1 TTM Revenue = 11.273
2018 Q1 TTM Revenue = 13.804
YOY Revenue Growth = 22.45%, previous quarter 20.77%

EPS Growth (non-GAAP)
2017 Q1 TTM EPS = 1.57
2018 Q1 TTM EPS = 2.04
YOY EPS Growth = 29.9%, previous quarter 27.33%

Non-GAAP P/E (Check Current Price) = 74.00/2.04 = 36.27

Trailing 1YPEG = 36.27/29.9 = 1.21

PayPal Metrics

Here is a look at some of PayPal’s other important metrics growth:

of active accounts: 237M, +15% YOY

Payment transactions: 2.214B, +25% YOY
Payment transactions per active account: 34.7, +8% YOY
Total Payment Volume (TPV): $132.36B, +32% YOY
Mobile Payment Volume: $49B, +52% YOY
Transaction margin: 57.1%
Operating margin (non-GAAP): 22.5%
Venmo processed $12B TPV, +80% YOY
Cash and cash equivalents: $7.8B
Short term borrowings: $3.0B
Repurchased 23.6M shares, approx. $1.8B
One Touch: 92M consumers, 8.6M merchants participating

And here’s a look at the historic growth of those numbers:


# of Active Accounts (millions) 	Q1		Q2		Q3		Q4
2014					148		152		157		162
2015					165		169		173		179
2016					184		188		192		197
2017					203		210		218		227
2018					237

Payment Transactions (millions)	        Q1		Q2		Q3		Q4
2014					918		930		972		1144
2015					1123		1161		1216		1428
2016					1414		1448		1512		1755
2017					1771		1817		1941		2240
2018					2214

Transactions Per Active Account	        Q1		Q2		Q3		Q4
2014					23		23		24		24.5	
2015					25.2		26.1		26.9		27.5
2016					28.4		29.4		30.2		31.1
2017					31.7		32.3		32.8		33.6
2018					34.7

TPV (billions)				Q1		Q2		Q3		Q4
2014					53.676		56.736		58.184		66.039
2015					63.021		67.482		69.738		81.523
2016					81.056		86.208		87.403		99.348
2017					99.327		106.44		114.05		131.45
2018					132.36

Transaction Margin (%)			Q1		Q2		Q3		Q4
2014					65.0		65.7		63.1		63.5	
2015					64.2		63.8		62.3		61.1
2016					60.4		59.8		58.7		57.7
2017					56.7		56.3		54.8		65.1
2018					57.1

Operating Margin (%)(non-GAAP)	        Q1		Q2		Q3		Q4
2014									18.4		20.4
2015					22.1		22.6		19.9		20.8
2016					21.1		19.9		18.4		21.1
2017					21.6		21.0		20.0		22.0
2018					22.5

Will be back over the weekend sometime after reading through the conference call. Any other thoughts/comments/concerns?

Matt
Long PYPL
MasterCard (MA), PayPal (PYPL), Skechers (SKX) and Square (SQ) Ticker Guide
See all my holdings at http://my.fool.com/profile/TMFCochrane/info.aspx

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