PayPal CEO Dan Schulman plans to step down by the end of 2023, following a tenure marked by huge growth at the payments company, but more recently, layoffs and a slumping share price amid a souring economy.
Schulman, a 65-year-old former American Express executive, joined PayPal in 2014, just before it spun off from its parent eBay. He took it through its debut as an independent publicly-traded company in 2015, and then a period of major expansion during which its annual revenue grew from $8 billion in 2014 to $27.5 billion in 2022.
More recently, as the economy slowed, PayPal started facing strong economic headwinds. In January, it laid off 7% of its employees, or approximately 2,000 workers, joining other tech behemoths, including Google, Microsoft, and Salesforce, that have recently let go of staff.
Riding the explosive growth in ecommerce in the beginning of the pandemic, PayPal’s stock price skyrocketed past $300 in the summer of 2021. But it quickly slumped to a low of $69 by December 2022 as the economic outlook turned sour
Schulman’s planned departure was announced as PayPal released its fourth quarter earnings report. No replacement was named.
PayPal reported a 7% increase in overall revenue from $6.92 billion in the fourth quarter of 2021 to $7.4 billion in same period of 2022. Profits in the fourth quarter of 2022 increased to $921 million compared to $801 million in the same period in 2021.
“I am confident that we are well positioned to utilize our unique assets to remain a market leader in digital payments,” Schulman said in the earnings release.
PayPal’s share price rose in after-hours trading, reaching $83.50, a 6% increase over its close in regular trading.
The payments provider said transaction revenue, which includes revenue from its main payments business along with crypto transactions, totaled $6.7 billion in the fourth quarter of 2022. That’s up from $6.37 billion in the year-ago period.
Unlike prior recent earnings when it touted its crypto initiatives, PayPal mentioned its crypto business only once in the latest release. The company’s continued avoiding of cryptocurrencies in its public messaging coincides with the crypto industry’s implosion in 2022.
In October 2020, PayPal made a big splash in crypto when it announced that U.S. users would be able to buy, hold, and sell Bitcoin, Ethereum, Bitcoin Cash and Litecoin on its payment apps.
As the price of Bitcoin and other cryptocurrencies soared through 2021, the company expanded its offerings.
PayPal’s new features enabled users to pay merchants with cryptocurrency, cashing out the value of their tokens at checkout. It partnered with Coinbase to allow those with PayPal-linked debit cards and bank accounts to buy digital assets on the world’s second largest cryptocurrency exchange by trading volume. And it expanded its crypto service beyond the U.S. to other countries, including the United Kingdom.
In 2022, as the Crypto Winter chilled the industry and prominent businesses like Celsius and Three Arrows Capital went bankrupt, PayPal went comparatively silent about its crypto offerings in earnings releases and calls, despite its ongoing efforts to update and expand its services.
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