PayPal misses Q4 estimates and names HP’s Enrique Lores as CEO
PayPal reported weaker-than-expected Q4 results, issued a subdued profit outlook and named HP chief Enrique Lores as its next CEO, sending shares sharply lower.
Copy link
By Torontoer Staff
PayPal reported fourth-quarter results that fell short of Wall Street expectations and issued a muted profit outlook for 2026, while announcing Enrique Lores, the outgoing CEO of HP, will take over as president and CEO on March 1. The stock tumbled in early trading as investors absorbed the earnings miss and the leadership change.
The board said the pace of change and execution under current CEO Alex Chriss was not in line with its expectations. Chief financial officer Jamie Miller will serve as interim CEO until Lores assumes the role.
Key results
- Revenue for the quarter: US$8.68 billion, below the US$8.80 billion consensus.
- Total payment volumes: US$475.1 billion, up 6% on a foreign-exchange neutral basis.
- Adjusted earnings per share: US$1.23, versus analysts' estimate of US$1.28.
- Online branded checkout growth slowed to 1% year over year, down from 6% a year earlier.
- Company issued a subdued full-year adjusted profit outlook, below analysts' roughly 8% growth expectation.
Why results disappointed
PayPal attributed the shortfall mainly to weaker U.S. retail spending and slower growth in its higher-margin branded checkout business. Consumers have been prioritising essentials amid elevated interest rates and persistent living costs, and retailers reported softer seasonal demand during what is typically a stronger holiday quarter for payment processors.
Online branded checkout, a strategic focus intended to capture more of the merchant payment flow and raise margins, decelerated sharply. The company cited U.S. retail weakness, international headwinds and tougher year-over-year comparisons as drivers of the slowdown.
Leadership change
PayPal’s board said it has appointed Enrique Lores, who has led HP for more than six years, to succeed Alex Chriss. The board pointed to a need to accelerate execution and change the pace of the business. Jamie Miller will lead the company on an interim basis until Lores arrives on March 1.
The pace of change and execution under current CEO Alex Chriss was not in line with [the board's] expectations.
PayPal board
Lores joins from a large consumer technology company with experience managing hardware and services across global markets. The appointment signals the board’s desire for an executive who can focus on operational execution as competition intensifies in payments from both Big Tech firms and newer fintech entrants.
Market reaction and outlook
Shares fell sharply after the announcement and earnings release. Investors have been cautious about PayPal for several years as Apple, Google and other players push deeper into payments, and the branded checkout slowdown heightened those concerns.
PayPal said it will take near-term actions to restore momentum in online branded checkout, but provided limited detail on specific measures. The company faces the dual challenge of reinvigorating merchant adoption of its branded checkout while navigating a consumer spending environment that has softened in some categories.
What to watch next
- How Lores outlines his strategy when he takes the helm on March 1.
- Quarterly updates on branded checkout growth and merchant adoption.
- Any guidance changes or restructuring steps aimed at restoring higher-margin revenue.
PayPal’s next few quarters will be closely watched by investors and merchants. The company needs to show clearer signs of execution and a path to reaccelerate branded checkout if it is to regain confidence after a disappointing holiday quarter and a sudden leadership transition.
PayPalearningsbusinessleadershipfinance
