PayPal reported a better-than-expected 18.1% rise in quarterly revenue, helped by a surge in payment processing volumes and customer additions.
PayPal, spun off from e-commerce company eBay last year, said its revenue rose to $2.67 billion in the third quarter ended Sept. 30, from $2.26 billion a year earlier.
Net income rose to $323 million, or 27 cents per share, from $301 million, or 25 cents per share.
Excluding items, the company earned 35 cents per share.
Analysts on average had expected a profit of 35 cents per share and revenue of $2.65 billion, according to Thomson Reuters I/B/E/S.
The payments processor, which signed network deals with Mastercard and Visa this year, has focused on growing transaction volumes and expanding its share of the digital payments market.
Active customer accounts rose 11% to 192 million in the third quarter, beating the average analyst estimate of 191.6 million, according to research firm FactSet StreetAccount.
Total payment volumes surged 25% to $87 billion.
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However, PayPal’s transaction margins, which have been steadily declining for the last five quarters, fell to 58.7% from 59.8% in the second quarter.
PayPal processed 1.5 billion transactions in the latest quarter, slightly lower than the average estimate of 1.52 billion.
Up to Thursday’s close, shares
of the company had risen 10.7% this year, outperforming the 4.8% gain in the broader S&P 500. Shares in PayPal rose 3% in after-hours trading on Thursday to $41.26.