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What’s happening: Shares of PayPal rose slightly in after-hours trading on Tuesday, with the company projecting accelerating growth at its Investor Day held in New York City.
What happened: PayPal reaffirmed its guidance for fiscal 2025 and announced its medium-term growth projections (fiscal 2025 to 2027).
The payments giant also outlined its strategic growth plans and partnerships, while introducing PayPal Open.
Why it matters: Amid rising competition and market share losses, PayPal has been struggling with margin contraction. With job cuts and other cost saving measured, the company returned to profitable growth in 2024.
At the Investor Day, PayPal reaffirmed its 2025 guidance of “at least 5%” growth in transaction margin dollars and 6%-10% growth in non-GAAP earnings. The company also initiated its medium-term guidance, projecting high single-digit growth in transaction margin dollars and low teens+ growth in non-GAAP earnings by 2027.
The company introduced PayPal Open, a unified platform for all businesses. The platform brings all enterprise services and consolidates the company’s many brands (like Braintree and Hyperwallet) under one umbrella. PayPal Open also integrates external commerce partners to provide a wider range of offerings to merchants.
PayPal Open is soon to become available in the US and its launch in the UK and Germany is planned for 2026. CEO Alex Chriss said during the event, “We have increased our innovation velocity and are consolidating to one platform to meet the evolving needs of both consumers and merchants.”
The payments behemoth also announced an extension of its partnership with Verifone, a provider of technology for electronic payment transactions. The expanded partnership aims to combine Verifone’s in-person payment assets with PayPal’s payment processing and ecommerce capabilities to offer omnichannel payment acceptance solutions to merchants.
PayPal also deepened its partnership with JPMorgan Payments to offer Fastlane, which expedites checkout speeds for consumers, to its clients across Europe.
PayPal’s shares rose by 0.34% to $74.32 in extended trading on Tuesday. The stock has lost around 18% over the past month.
What to watch: Investors will continue monitoring PayPal’s execution of the transition from a standalone payment solution to a fully integrated payment ecosystem. Markets will also watch whether PayPal’s several initiatives to improve the checkout experience succeed in curbing market share losses.
Context: The US dollar continued its downward trajectory on Tuesday, with growing speculations of interest rates easing.
Details: US President Donald Trump’s threats to impose tariffs on various imports led to concerns over rising manufacturing costs. The adverse impact on economic growth has been weighing on market sentiment.
The Trump administration provided more details on Tuesday of plans to make semiconductor restrictions for China even more stringent, in an attempt to reduce the Asian nation’s technology dominance.
Meanwhile, comments from US Secretary of the Treasury, Scott Bessent, on Tuesday suggested that interest rates could fall in the country even without the Federal Reserve’s actions. The Trump administration’s policies may trigger a decline in US yields, Bessent said, which would exert pressure on the US dollar.
The US released the House Price Index, which rose to 4.7% in December, from 4.5% in the previous month. The figure came in higher than market expectations of 4.1% but failed to lift sentiment.
Consumer confidence in the US plummeted to 98.3 in February, from 105.3 in the previous month. The figure was significantly short of market estimates of a reading of 102.5.
The US dollar index, which measures the greenback’s performance versus a basket of major peers, fell around 0.3% to 106.27 on Tuesday. The index is down almost 1.5% over the past month.
What to watch: Investors will continue monitoring President Donald Trump’s moves to impose tariffs on imports into the US.
Markets will also watch comments by Federal Reserve officials for any indication of whether policymakers are leaning towards a rate cut.
The US is scheduled to report new home sales data today (19:00 UAE Time). Sales of new single-family homes rose by 3.6% to an annualised rate of 698,000 in December, beating market expectations of 670,000. The US is also gearing up to release durable goods orders and initial jobless claims on Thursday.
Other Markets: US trading indices closed mostly lower on Monday, with the Dow Jones index up 0.37% and the S&P 500 and Nasdaq 100 down by 0.47% and 1.35%, respectively.
After voting against a UN draft resolution supporting Ukraine, the US presented another resolution that also called for a ceasefire but omitted mention of supporting Ukrainian territorial integrity. The news sent the RUB/USD pair higher in forex trading this morning.
Mexico reported a current account surplus of $12,601 million in the fourth quarter, up from $11,745 million in the year-ago quarter. However, the figure coming in below market expectations exerted pressure on the MXN/USD forex pair.
Argentina’s economic activity estimator rose by 5.5% year-on-year in December, accelerating from a 0.4% increase in November. The figure surpassing market expectations of 3.5% growth and representing the biggest expansion since August 2022 sent the ARS/USD higher in forex trading this morning.
Australia’s consumer price index (CPI) rose 2.5% year-on-year in January, unchanged from the prior month. However, the figure was lower than market estimates of 2.6%, which exerted pressure on the AUD/USD forex pair.
The American Petroleum Institute reported that US crude oil inventories had declined by 0.64 million barrels in the week ending February 21, following a rise of 3.34 million barrels in the previous week. The figure missed market expectations of a gain of 2.3 million barrels, which sent the WTI up 0.29% to $69.13 on Tuesday.
South Africa’s inflation state (12:00 UAE Time), Spain’s PPI (12:00 UAE Time), Taiwan’s GDP growth and unemployment rate (12:30 UAE Time), Hong Kong’s GDP growth (15:00 UAE Time), Iceland’s unemployment rate (13:00 UAE Time), Switzerland’s economic sentiment (13:00 UAE Time), Canada’s wholesale sales (17:30 UAE Time), EIA’s US crude inventory change (19:30 UAE Time) and Russia’s industrial production (20:00 UAE Time).
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