Brad Freeman
Equity Researcher, Creator of Stock Market Nerd
PayPal's standalone turnaround plan is unlikely to work because its new focus areas are the same ones it has failed at for years. Per @wallstengine, CEO Enrique Lores is pursuing the plan after Stripe and Advent's $50B+ takeover talks stalled, focusing on expanding Venmo into a broader financial app, improving checkout and cutting billions in costs. x.comÂ
PayPal under Lores is moving away from Chriss's strategy of removing silos and integrating platforms. Lores talks about growing Venmo as a standalone business unit, which makes sense if fishing for an acquisition. Replying to @xwallstx, who notes PayPal World rolling out, ads growing quickly and a bank charter pending, initiatives such as PayPal World, biometrics, Xoom international remittances and PayPal Everywhere look de-prioritized and de-emphasized rather than walked back. x.comÂ
PayPal's near-flat growth and rising checkout competition leave it a Grade C, prove-it story. Q3 FY26 revenue rose just 2%; operating income fell 8% as restructuring charges rose from $69 million to $255 million, and net income fell 14%. The business still earns over $1 billion a quarter, but it is treading water. x.comÂ
PayPal's raised earnings and free-cash-flow guidance supports rejecting Stripe and Advent's $60.50-per-share offer. The shares now trade around $57, below the rejected bid, but that does not make the rejection a mistake. x.comÂ
PayPal's cost cuts and reserve releases prop up short-term numbers, while investing for growth wastes time. Its slow bleed gives delusional bulls hope, making it the ultimate value trap; it should not be a public company. x.comÂ
PayPal's growth has stalled and it faces too much fintech competition. That view could change if the company adapts, pivots and proves otherwise. x.comÂ
PayPal is worth much more than Stripe's reported $53 billion takeover offer, and its board reportedly rejected the bid as inadequate. PayPal makes over $5 billion a year and is growing, buys back about 7% of its shares annually, and traded at just 9x earnings before the news and 11x the offer. $75 a share should be the bare minimum, and a bidding war may follow. x.comÂ
PayPal is a low-switching-cost, low-moat business headed for secular decline as payment fees race to the bottom. In 2021 it wanted to buy Pinterest for $45B; now Stripe reportedly wants to buy it for $53B. Stripe is probably the best suitor by far, as a good tuck-in acquisition. x.com x.comÂ
PayPal's problem is deeply rooted poor management and a complete lack of ambition; it could have made a dozen moves over the years to expand and grow. Stripe appears to be the only buyer willing to take it on. x.com x.comÂ
PayPal likely has a floor now, given its new Anthropic partnership and the potential split of Venmo. Per @StockSavvyShay, PayPal and Anthropic are launching AI training for small businesses, including a free course and a Claude for Small Business plugin that connects Claude to PayPal, QuickBooks, HubSpot and Canva for tasks like invoicing and refunds. x.comÂ
PayPal faces structural disintermediation as agentic commerce and ecosystem wallets like Apple Pay and Google Pay erode its role as a checkout intermediary. Branded checkout grew just 1.0% in Q4 2025, a sign it is losing the buy button, despite over $6B of annual free cash flow. CEO Enrique Lores is pivoting to agentic infrastructure with ChatGPT, but with a $9B refinancing looming, PayPal looks a value trap until AI-first growth outpaces Apple and Google. x.comÂ
