PayPal reported second-quarter net revenue of $8.3bn, up 5% when ignoring exchange rate impacts. Total payment volumes rose 5%, with peer to peer and other consumer experiencing the fastest growth, up 10%.
Underlying operating profit rose 13% to $1.6bn. This growth was driven by a 7% uplift in the transaction margin (a bit like gross profit) which was helped by a shift in business mix to more profitable branded checkouts and credit.
Underlying free cash flow fell from $1.1bn to $0.7bn. Net debt was $1.3bn at period-end. The company repurchased $1.5bn of shares in the quarter.
Full-year underlying earnings per share (EPS) guidance has been raised from $4.95-$5.10 to $5.15-$5.30, pointing to growth of between 11-14%. Full-year free cash flow guidance of $6-7bn has been reiterated.
In the third quarter however transaction margin growth is expected to slow to between 3% and 5%.
The shares fell 4.4% in early trading.
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PayPal key facts
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