PayPal’s revenue increased 18% year on year in the third quarter to reach $2.67bn, beating the $2.65bn Wall Street expected.
The company’s net income over the three-month period came in at of $323m – a 7% increase on Q3 2015.
PayPal added 19m new customers over the last 12 months and now counts 192m active users.
The total number of transactions processed during Q3 rose 24% to 1.5bn but some investors were disappointed with the company’s total payments volume which grew at 25% year on year to reach $87.4bn but fell short of the $88.3bn forecast.
PayPal was spun out from e-commerce parent eBay last year and is expanding its services across other payments verticals such as mobile-focused payments offering Braintree and peer-to-peer app Venmo.
The social payments app saw strong growth of 131% in the quarter to process just short of $5bn.
PayPal CEO and president Daniel Schulman said, “We are further expanding the ubiquity and value of the PayPal brand and moving deliberately towards achieving our vision of becoming an everyday, essential financial service for people around the world.”
Investor were anxious to see how the company’s recently deals with MasterCard and Visa would impact its costs and profits.
As a result of pressure from the credit card companies PayPal no longer encourages users to link their profiles directly to their banks account, instead allowing them to connect to their VISA or MasterCard.
The deal will increase the credit card fees PayPal pays but it hopes to offset this with growing digital wallet transactions at physical locations.
PayPal said it expects a “stable to growing” operating profit over the next three years and forecast a total payment volume increase of as much as 20%.
Afterhours trading saw the company’s stock rise 4.5% to close at $40, suggesting investors were satisfied with the company’s direction.
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