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Are we witnessing an unexpected role reversal? Since the split, EBay has topped earnings estimates and raised its outlook while PayPal has missed Wall Street projections for the third quarter. Investors are most concerned with PayPal's deteriorating take-rate (how much the company keeps from each payment made on its network), which has dropped to 3.2% from 3.4% a year earlier. PayPal has defended its strategy of attracting more customers and larger merchants and offering them a wider array of services as the digital payment race with Square, Stripe, Google, and Apple intensifies.
“If we’re successful in our strategy, our take rate comes down,” Schulman said. “That’s how the payments business works.” PayPal reported third-quarter profit, excluding items, of 31 cents a share on revenue of $2.26 billion, compared with analysts’ average projections of 29 cents and $2.28 billion, according to data compiled by Bloomberg. Sales were $1.98 billion a year earlier. The company’s operating margin was 14.6 percent in the quarter compared with 13.8 percent a year earlier.
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