PayPal reported its second-quarter results before the market opened on Tuesday, beating both its own forecasts and Wall Street’s expectations. This is a sign that the company’s turnaround is starting to show results.
PayPal posted adjusted earnings of $1.38 per share, which was higher than the $1.28 analysts expected. Revenue reached $8.68 billion, also beating the consensus forecast of $8.47 billion.
PayPal pointed to gains in several important areas. Transaction margin dollars, a key measure of profitability, rose 1% to $3.9 billion, or 3% if you don’t count interest earned on customer balances. Total payment volume increased 9% on a currency-neutral basis to $486.4 billion, a figure that shows how well the company is making money from its platform.
One of the biggest updates was PayPal’s higher full-year forecast. The company now expects adjusted earnings of $5.38 per share for the year, up from $5.31 in 2025. This is better than its earlier guidance, which had predicted anything from a small drop to only modest growth as recently as May. Analysts had mostly expected earnings to stay about the same year over year. PayPal also raised its full-year outlook for transaction margin dollars to about $15.6 billion, up slightly from $15.5 billion in 2025 and better than the small decline it had expected just a month ago.
Although the increase in guidance was small, the more positive outlook is a good sign for a turnaround that is still just beginning. As of Monday’s close, PayPal shares were down nearly 4% for the year, while the S&P 500 had posted solid gains.
Fintech stocks have struggled this year, and PayPal has been under even more pressure. In February, disappointing fourth-quarter results and a change in leadership caused the stock to lose nearly half its value. However, much of that loss was recovered in mid-July when takeover rumors pushed the shares up sharply. The stock has climbed 35% in the past month, setting it up for its best monthly performance ever.
Investors are watching closely as PayPal moves forward with a strategic reorganization announced earlier this year by CEO Enrique Lores, who took over in early 2026 after a short period under the previous leader. Lores, who used to lead HP Inc., acted quickly to split PayPal into three separate divisions, including dedicated teams for Venmo and cryptocurrency.
On Tuesday, the company said it expects to save $400 million this year, as part of a larger plan to reach $1.5 billion in savings over the next two to three years.
