PayPal Fuels eBay’s Engine in Q1; M-Payments up 40 Percent (April 23, 2015)
Electronic payments were a driving force behind eBay’s first quarter, ended March 31, 2015, which saw the online auction site total $4.45 billion in revenue compared with $4.26 billion in the same quarter a year ago, according to the company’s latest earnings report. PayPal’s net total payment volume grew 18 percent in the first quarter to $61 billion, with merchant services volume up 26 percent. Meanwhile, mobile payments were up 40 percent year-over-year and now represent 30 percent of all PayPal transactions, according to one report. PayPal also gained 3.6 million new active accounts in the quarter, up 11 percent to 165 million, and the company processed more than 1 billion transactions in the quarter, an increase of 24 percent.
The strong growth of PayPal’s customer base, among other factors, reflects the growing popularity and “relevance of the PayPal value proposition globally,” according to eBay. eBay attributes two acquisitions to bolstering PayPal’s ability to partner with merchants and deepen its trust with consumers. The acquisition of mobile payments platform provider Paydiant helps PayPal extend its mobile value proposition to the offline world for merchants and consumers, and the acquisition of cybersecurity company CyActive strengthens PayPal’s security capabilities.
“Each business is executing well with greater focus and operating discipline as we prepare to separate eBay and PayPal into independent publicly traded companies,” said eBay President and CEO John Donahoe. “We are moving forward … with a smooth separation expected in the third quarter.” The two companies outlined their plan for PayPal to spinoff from parent company eBay in a five-year operating agreement the two companies jointly released earlier this month.
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