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PayPal Holdings, Inc. (PYPL - Free Report) is scheduled to report first-quarter 2023 results on May 8.

The company projects year-over-year revenues growth of 7.5% on a spot rate basis and 9% on a currency-neutral basis. The Zacks Consensus Estimate for revenues is pegged at $6.98 billion, indicating an improvement of 7.7% from the prior-year quarter’s reported figure.

Non-GAAP earnings are expected to be $1.08-$1.10 per share, suggesting growth of 23-25% on a year-over-year basis. The Zacks Consensus Estimate for earnings is pegged at $1.09 per share, suggesting an increase of 23.9% from the year-ago reported figure. Further, the figure has moved 0.9% upward over the past 30 days.

Notably, the company surpassed the Zacks Consensus Estimate in three of the trailing four quarters while matching the same once, delivering an earnings surprise of 6.6%, on average.

PayPal Holdings, Inc. Price and EPS Surprise

PayPal Holdings, Inc. price-eps-surprise | PayPal Holdings, Inc. Quote

Factors at Play

PayPal’s persistent efforts toward strengthening the product portfolio are likely to have aided the company in gaining traction among customers in the first quarter.

The company’s upcoming results are likely to have benefited from Venmo’s product line strength, which is expected to have continued to aid customer engagement on PayPal’s platform. This is expected to have boosted growth in total active accounts in the quarter under review.

Venmo’s strong monetization efforts are likely to have aided its adoption rate in the to-be-reported quarter.

Robust PayPal Checkout experiences are expected to have sustained the company’s momentum in the quarter under review.

PayPal is expected to have gained from the growing proliferation of buy now pay later (BNPL) solution on the back of its strong offerings.

Further, strengthening offerings for small businesses is likely to have boosted growth in the company’s payments volume in the yet-to-be-reported quarter.

Key Metrics to Consider

Total payment volume (TPV), active customer accounts, payment transactions per active account and the total number of payment transactions are considered to be the key metrics for analyzing PayPal’s business growth.

For the first quarter, the Zacks Consensus Estimate for active customer accounts is pegged at 438 million, up 2.1% from the year-ago quarter’s reported figure.

The consensus mark for payment transactions per active user is pegged at 52 million, suggesting growth of 10.6% from the year-ago quarter’s reported number.

The consensus estimate for the total number of payment transactions is pinned at 5.8 billion, indicating an improvement of 12.6% from the prior-year quarter’s reported figure.

The Zacks Consensus Estimate for TPV is pegged at $348.26 billion, suggesting growth of 7.8% on a year-over-year basis.

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