By Liz Moyer and Scott Kanowsky
Investing.com -- PayPal Holdings Inc (NASDAQ:PYPL) beat expectations for quarterly earnings and said CEO Dan Schulman plans to retire at the end of the year.
Shares of the payments fintech rose 2.3% in after-hours trading and are up 10% so far this year.
The board will retain a search firm to help find a successor to Schulman, who joined it in 2014 as it was being separated from eBay (NASDAQ:EBAY). He said he believes that remaining in the role for the rest of 2023 gives PayPal "enough runway" to find his replacement.
"I wanted to be sure that PayPal had positive momentum and was in a position to deliver a solid year of performance. So, I can be sure I wasn't leaving the company in a difficult position," Schulman said.
PayPal reported adjusted earnings of $1.24 a share and revenue of $7.38 billion. Analysts expected adjusted profit of $1.20 a share on revenue of $7.39B. Revenue was up 7% from the prior year.
Total payment volume came in a little below expectations for the fourth quarter, around $357.4B, representing a 5% increase, versus forecasts for $360B.
Schulman called 2022 a "transformative year" for PayPal, highlighted by investments "in our platform to better serve our customers, while focusing and streamlining our business."
For the full-year 2022, PayPal said revenue rose 8%, to $27.5B, and total payment volume rose 9% to $1.36 trillion. Both were in line with estimates.
For the first quarter of 2023, the company is forecasting net revenue to rise 7.5% and adjusted earnings per share of $1.08 to $1.10, above expectations for $1.07 a share. It expects full-year adjusted EPS to be around $4.87, above expectations.
Schulman told investors in a call after the earnings release that first-quarter was trading off to a stronger start than the group had initially anticipated, adding that it is confident that consumer spending online will eventually recover in the long term as a recent spike in living costs recedes.
"Still [it is] difficult to accurately assess how the year ahead will play out in terms of e-commerce growth," Schulman said. "If you ask 20 experts, you get 20 different opinions. Our baseline assumption is that discretionary spend will remain under pressure, and global e-commerce growth will be slightly positive year over year."