How PayPal Makes Money—Financial & Key Business Statistics

A breakdown of PayPal's products, business model, and key business metrics.

Updated quarterly. Last updated: August 20, 2021.

PayPal Overview

Ticker PYPL
Industry Financial Services
CEO Dan Schulman
Year Founded 1998
IPO Date February 15, 2002
TTM Revenue $22.8 billion
TTM EBITDA $4.9 billion
TTM FCF $4.7 billion

What PayPal Does

PayPal is a digital payments company that serves both consumers and businesses.

Consumer products:

  • PayPal-Its first product. The OG!
  • Venmo-Lets you send money to people and merchants via a mobile app.
  • Xoom-Lets you send money abroad.
  • Honey-Helps you find coupon codes on 30,000+ sites. (PayPal acquired Honey for $4 billion in January 2020)
  • PayPal Credit-Its version of buy now, pay later (BNPL).

B2B products:

  • Braintree-Helps online businesses accept payments through software.
  • Zettle-A point of sale solution for merchants.
  • Hyperwallet-Helps businesses send payments to contractors, freelancers, and sellers around the world.

PayPal's Revenue, Gross Profit, EBITDA, and FCF

How PayPal Makes Money—Its Business Model

PayPal makes money two ways:

  • Transaction fees-Fees charged to merchants and consumers for transacting on its platform.
  • Fees from value-added services-Earned from partnerships, subscription fees, gateway fees, and other services. They also earn interest on merchant and consumer loans.

Revenue breakdown

PayPal's Key Business Metrics

PayPal tracks four metrics to measure the health of its business.

  • Active accounts
  • Total payment volume
  • Payment transactions
  • Payment transaction per active account

Active accounts

  • Active accounts are accounts registered with PayPal or one of its platform partners that has completed a transaction in the past twelve months. (This includes the Honey platform)

Total payment volume (TPV)

  • Total payment volume is the total value of payments, net of reversals, processed on its platform.

Number of payment transactions

  • Number of payment transactions is the total number of payments, net of reversals.

Number of payment transactions per active account

  • Number of payment transactions per active account is the total number of payment transactions during the previous twelve-month period, divided by active accounts at the end of the period.  

PayPal's Competitors

On the consumer side:

  • Apple and Google pay
  • Cash App from Square
  • Zelle (The old school banks attempt to copy Venmo)
  • Skrill

On the B2B side: