What’s next? PayPal plans to prioritize growth initiatives but will remain cautious of a wider economic downturn.
- BNPL and Venmo. PayPal generates a large volume of transactions from—and has a huge user base for—both Venmo and its BNPL offering. But neither generates a profit. PayPal wants to cut Venmo’s losses with more profitable services beyond P2P payments. And it can pick up customers and move toward a maiden profit for its BNPL product by adding features like letting users choose the frequency and size of installments.
- Existing user focus. PayPal has successfully boosted spending per user: Transactions per active account climbed a record 13% YoY to more than 50 times per year. And it will keep working to convert moderately engaged users into highly engaged ones. This can help grow revenues by capitalizing on the firm’s 35 million active merchant accounts and nearly 400 million active consumer accounts, according to Schulman.
- Big Tech partnerships. PayPal’s new tie-in with Apple Pay gives it access to the tech firm’s huge user base, which is expected to hit 48.7 million next year, per Insider Intelligence forecasts. And expanding Venmo’s Amazon partnership gives PayPal the opportunity to capture a slice of the online retailer’s expected $397.43 billion in US retail ecommerce sales this year, per our forecast.
Keep reading: Check out our PayPal report for more on how the company’s growth strategy could shield it from a market downturn.
This article originally appeared in Insider Intelligence's Payments Innovation Briefing—a daily recap of top stories reshaping the payments industry. Subscribe to have more hard-hitting takeaways delivered to your inbox daily.