PayPal has been working to squeeze value from Venmo, which is popular among smartphone users. AP Photo
PayPal has been working to squeeze value from Venmo, which is popular among smartphone users. AP Photo

PayPal beats Q3 estimates, looks to monetise Venmo



PayPal Holdings exceeded analysts’ earnings estimates and said it’s making progress toward monetising Venmo, the popular mobile-payments service.

The San Jose, California-based company reported adjusted earnings per share of 58 cents in the three months ending in September, above analysts’ estimates of 54 cents. Revenue in the third quarter rose 14 per cent to $3.68 billion. Analysts had projected $3.67bn on average.

PayPal boosted its outlook for fourth-quarter revenue to $4.2bn to $4.28bn, in line with analysts’ estimates. Shares rose as much as 9.5 per cent in extended trading, after closing down 3.3 per cent.

Chief executive Dan Schulman has been working to squeeze value from Venmo, which is a hit among smartphone-wielding consumers but has yet to turn a profit. In an interview Thursday, Mr Schulman said PayPal has reversed a trend of mounting losses in the Venmo business. “It’s clearly on the right track,” he said. “The economics overall are improving, and the growth and momentum around it is substantial.”

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In June, the company began rolling out a debit card for Venmo, which would allow it to collect transaction fees. Before PayPal’s last earnings report in July, billionaire Dan Loeb’s hedge fund Third Point disclosed a stake in the company and said he thinks Venmo could contribute $1bn in annual sales within three years.

PayPal has courted retailers to accept Venmo transactions from customers’ phones, and Uber Technologies agreed to add a Pay With Venmo option in July. This week, PayPal increased the fee for fast transfer of funds to bank accounts to 1 per cent of the transaction amount from a flat 25 cents.

In a conference call following the earnings report Thursday, Mr Schulman said the number of people using Pay With Venmo increased 185 per cent last month compared with the month before. By convincing people to make purchases using their Venmo balance instead of a credit card linked to their accounts, PayPal is hoping to wring more profit from transaction fees.

PayPal doesn’t disclose the number of active Venmo users, but the transaction growth rate has plateaued. Transactions on the app totalled $16.7bn in the third quarter, an increase of 78 per cent from the same period a year ago. The growth rate was the same in the second quarter. Across all services, PayPal handled $143bn in payment volume in the third quarter, an increase of 24 per cent.

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Artist: Coldplay

Label: Parlophone/Atlantic

Number of tracks: 10

Rating: 3/5

Jigra
Director: Vasan Bala
Starring: Alia Bhatt, Vedang Raina, Manoj Pahwa, Harsh Singh
Rated: 3.5/5
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Israel Palestine on Swedish TV 1958-1989

Director: Goran Hugo Olsson

Rating: 5/5

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Name: Almnssa
Started: August 2020
Founder: Areej Selmi
Based: Gaza
Sectors: Internet, e-commerce
Investments: Grants/private funding
What are the GCSE grade equivalents?
 
  • Grade 9 = above an A*
  • Grade 8 = between grades A* and A
  • Grade 7 = grade A
  • Grade 6 = just above a grade B
  • Grade 5 = between grades B and C
  • Grade 4 = grade C
  • Grade 3 = between grades D and E
  • Grade 2 = between grades E and F
  • Grade 1 = between grades F and G
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THE SCORES

Ireland 125 all out

(20 overs; Stirling 72, Mustafa 4-18)

UAE 125 for 5

(17 overs, Mustafa 39, D’Silva 29, Usman 29)

UAE won by five wickets

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Install an air filter in your home.

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Top investing tips for UAE residents in 2021

Build an emergency fund: Make sure you have enough cash to cover six months of expenses as a buffer against unexpected problems before you begin investing, advises Steve Cronin, the founder of DeadSimpleSaving.com.

Think long-term: When you invest, you need to have a long-term mindset, so don’t worry about momentary ups and downs in the stock market.

Invest worldwide: Diversify your investments globally, ideally by way of a global stock index fund.

Is your money tied up: Avoid anything where you cannot get your money back in full within a month at any time without any penalty.

Skip past the promises: “If an investment product is offering more than 10 per cent return per year, it is either extremely risky or a scam,” Mr Cronin says.

Choose plans with low fees: Make sure that any funds you buy do not charge more than 1 per cent in fees, Mr Cronin says. “If you invest by yourself, you can easily stay below this figure.” Managed funds and commissionable investments often come with higher fees.

Be sceptical about recommendations: If someone suggests an investment to you, ask if they stand to gain, advises Mr Cronin. “If they are receiving commission, they are unlikely to recommend an investment that’s best for you.”

Get financially independent: Mr Cronin advises UAE residents to pursue financial independence. Start with a Google search and improve your knowledge via expat investing websites or Facebook groups such as SimplyFI.