PayPal reported an $81 million loss tied to its cryptocurrency holdings this quarter. But the company's core payments business outperformed expectations, with earnings per share beating analyst estimates. The mixed results come as rumors heat up that PayPal is eyeing a $53 billion acquisition of Stripe.
The crypto hit
The $81 million loss stems from PayPal's digital asset holdings. The company didn't break out which cryptocurrencies drove the decline, but the write-down reflects the volatile nature of the market. It's a notable number, but one that's largely overshadowed by the strength of PayPal's main business.
Payments business keeps humming
PayPal processed $486 billion in payment volume during the quarter. That's a massive figure, and it helped the company beat earnings per share estimates. The core payments engine — peer-to-peer transfers, merchant checkout, Venmo — is running smoothly. For investors, that's the real story. The crypto loss is a sideshow.
Stripe rumors resurface
Whispers of a PayPal-Stripe deal have been around for years. This week, the rumor mill kicked into high gear with talk of a $53 billion price tag. Stripe is a direct competitor in online payments, and a merger would create a payments behemoth. Neither company has commented. But the timing is interesting — PayPal just showed it can generate strong cash flow, and Stripe has been eyeing an IPO. A buyout would change the landscape.
PayPal's next earnings call will likely feature questions about the crypto loss and the Stripe rumor. The company hasn't confirmed any acquisition talks. For now, the Stripe rumor remains just that — a rumor. But with PayPal's payments business firing on all cylinders, the company has the financial firepower to make a move if it chooses.
