PayPals stock growth started to fall off. shot up from 17.8 billion in 2019 to more than 25 billion in 2021. They keep pounding on their chest talking about the scale and brand recognition of PayPal, and at the same time keep lowering the guidance. PayPal lost all of the gains it made over the pandemic just within a year. Also, any increase in interchange and card scheme fees (also outside of PayPal’s control) will further decrease the Transaction Margin.Įnough is enough? The company does not seem to have a plan for what to do next. Not sure what they can do on the Transaction expense side, as this is mostly the result of the payment method mix, but they are definitely in control of other expenses. As described above, operating expenses grew at a much faster pace than the revenue, so I would expect PayPal to take action on this. Let’s see how PayPal’s team acts to address the declining Take Rate. Repricing merchants is a slow process that should be carried out with caution to avoid losing the customer altogether. Last quarter, PayPal made some repricing efforts on the consumer side in order to increase the Take Rate however, those efforts have not yet resulted in improving Take Rate.
This will be especially difficult if rising inflation results in lower spending by consumers.ĭeclining Take Rate.
I am still in the opinion, that it might be challenging to achieve without the growth in Active Accounts. Despite the lowered guidance, the company is still expecting a 13-15% in Total Payment Volume in 2022.
0 kommentar(er)
