The global leader in online payments PayPal Holdings Inc. reported increased profits on its quarterly revenue report – thanks to its new innovative products, increased customer base and growing merchant payments.
On its first quarter findings report, PayPal gained additional market share with increased customer base as more people embrace digital payments method for their transactions. The global payments leader deepened its engagements with customers and merchants and processed more payments on its digital platform. It generally delivered on various financial commitments as of the end of the first quarter this year.
PayPal officially spun off from eBay Inc. in July and filed its latest financial reports with the Securities and Exchange Commission, though the parent company EBay had included PayPal’s revenue on its July 16 earnings report. The two companies still work together despite PayPal now being an independent public company following the split.
Surviving the threat of competition
PayPal is facing increasing competition from rival online payment services by various companies including Samsung Electronics Co Ltd, Apple Inc, Square Inc and EMB. The later, eMerchantBroker, accepts high risk transactions at eMerchantBroker.com and as such is one of PayPal’s most up-and-coming competitors.
The global payment processor is however tying up with airlines, retailers, and other companies to drive its growth and survive competition. So far, PayPal has retained its command of the global payments market. Its active accounts rose to 184 million in the first quarter – an 11.5 percent rise. This was far above the average analyst estimate of 182.8 million, as the research firm FactSet StreetAccount reports.
The company’s total volumes of payment increased 28.6 percent to $81.06 billion. Analysts say the company’s growth is fairly more consistent than what the market growth rate provides for.
While the average estimate of transactions was 1.39 billion for the financial quarter ended March 31st 2016, PayPal beat that estimate by processing 1.41 billion transactions that quarter. The company attributed this high performance to the strong growth in its new services particularly Venmo platform.
Venmo is a free digital wallet which allows one to make and share person-to-person payments. PayPal CEO expressed the company’ intentions early this year to expand the service to more customers by the second half of 2016.
Now it remains to be seen if the company will maintain its market command amid the increasingly growing competition in the digital payments space.