# PayPal’s spending warning casts pall over upbeat forecast Author: Pal Sinha, Barnali Author URL: https://financedigest.com/author/pal-sinha-barnali Published: 2023-02-10 Category: NEWS Category URL: https://financedigest.com/category/news Meta Title: PayPal predicts higher profit amid inflation but CEO to Meta Description: Despite macroeconomic challenges, PayPal projects strong profit, CEO to retire in 2023. E-commerce segment feeling a slowdown and trimmed expenses. URL: https://financedigest.com/paypals-spending-warning-casts-pall-over-upbeat-forecasthtml ![undefined](https://prod.superblogcdn.com/site_cuid_cm5qst7v3003gwirgwqtxn8i8/images/2023-02-09t221003z3lynxmpej1812drtroptp4paidy-m-a-paypal-1736814461886-compressed.jpg) By Manya Saini and Jaiveer Shekhawat (Reuters) – PayPal Holdings Inc forecast full-year profit above Wall Street estimates on Thursday but warned of pressure on discretionary spending, and said Chief Executive Dan Schulman will retire at the end of 2023. Macroeconomic pressures have begun to hurt American consumers, particularly those in the lower income bracket, but PayPal’s customers continue to spend largely undeterred by decades-high inflation. Even so, the company’s [upbeat forecast](https://www.financedigest.com/publisher-bloomsbury-casts-upbeat-forecast-says-books-affordable-pastime.html "Publisher Bloomsbury casts upbeat forecast, says books ‘affordable pastime’") comes alongside its previously announced commitment of lowering expenses in the backdrop of its key e-commerce segment feeling the pinch of a slowdown. The [rate of e-commerce growth in our core markets](https://www.financedigest.com/container-as-a-service-caas-market-with-covid-19-pandemic-analysis-growth-rate-and-forecast-2021-2027.html "Container As A Service (CaaS) Market With COVID-19 Pandemic Analysis, Growth Rate And Forecast 2021-2027") has decelerated. Inflationary pressures have affected discretionary consumer [spending and post-COVID spending patterns are still evolving,” acting finance](https://www.financedigest.com/student-finances-exposed-how-do-they-really-spend-their-money.html "Student finances exposed: How do they really spend their money?") chief Gabrielle Rabinovitch said in a call with analysts. [Shares in the payments heavyweight fell 1% in extended trading](https://www.financedigest.com/social-trading-is-the-new-way-that-gen-z-are-getting-their-share-of-the-pie.html "Social Trading is The New Way That Gen Z Are Getting Their Share of The Pie") after results. In a divergence from prior quarters, PayPal said it will not provide a forecast for full-year [revenue growth](https://www.financedigest.com/visa-revenue-growth-slows-more-as-tough-economy-sobers-spending.html "Visa revenue growth slows more as tough economy sobers spending"). “They don’t want to call out a revenue number at this point because of the macro uncertainty, they don’t want to put themselves in a box,” D.A. Davidson analyst Chris Brendler told Reuters. GRAPHIC: Total Payment Vols (TPV) come off pandemic highs – https://www.reuters.com/graphics/PAYPAL-RESULTS/egpbyaengvq/chart.png Schulman joined PayPal in 2014 to [lead the company](https://www.financedigest.com/infrared-thermometer-market-2021-global-leading-companies-analysis-revenue-trends-and-forecasts-2026.html "Infrared Thermometer Market 2021 Global Leading Companies Analysis, Revenue, Trends and Forecasts 2026"), after its separation from eBay the following year. Dan’s had notable success in growing PayPal materially over the years, however the [change may remove an overhang for some investors](https://www.financedigest.com/bayer-hits-8-month-high-as-investors-welcome-ceo-change.html "Bayer hits 8-month high as investors welcome CEO change") given recent/post-pandemic volatility,” Wolfe Research analyst Darrin Peller said in a note. Shares in PayPal have lost about 66% of their value since 2021, through the [stock’s last close](https://www.financedigest.com/world-stocks-rally-nikkei-closes-at-33-year-peak.html "World stocks rally, Nikkei closes at 33-year peak"). Last week, PayPal said it will lay off 7% of its workforce, or about 2,000 employees. PayPal said it [expects full-year adjusted profit](https://www.financedigest.com/portuguese-airline-tap-swings-to-profit-earlier-than-expected.html "Portuguese airline TAP swings to profit earlier than expected") of roughly $4.87 on a per share basis. Analysts on average had expected $4.75 per share, [according to Refinitiv IBES data](https://www.financedigest.com/most-sales-and-marketing-teams-struggle-to-activate-data-in-their-organisation-according-to-new-international-study.html "Most Sales and Marketing teams struggle to activate data in their organisation, according to new international study"). PayPal earned a profit of $1.24 per share on an adjusted basis in the [fourth quarter](https://www.financedigest.com/german-gdp-contracted-by-0-4-in-the-fourth-quarter.html "German GDP contracted by 0.4% in the fourth quarter") ended Dec. 31, [beating analyst estimates of $1.20 per share](https://www.financedigest.com/spending-drive-knocks-spotify-shares-after-q1-beat.html "Spending drive knocks Spotify shares after Q1 beat"). Its revenue rose 9% on an FX-neutral basis to $7.4 billion. (Reporting by Manya Saini and Jaiveer Shekhawat in Bengaluru; Editing by Shailesh Kuber) --- This blog is powered by Superblog. 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