PayPal outlook muted on mobile competition, currency trends
By Anna Irrera and Sruthi Shankar
(Reuters) - PayPal Holdings Inc PYPL.O offered a subdued outlook on Thursday, as it faced unpredictable currency fluctuations and an increasingly competitive digital payments market.
The payments processor predicted its first-quarter revenue would be roughly in line with analyst expectations, with flat to slightly better operating margins for the full year. PayPal gave the guidance in reporting a 17 percent rise in fourth-quarter revenue that mirrored Wall Street expectations.
Chief Financial Officer John Rainey said fourth-quarter results were hurt by currency movements, and he expected those pressures to continue throughout the year.
Paypal stock fell 2.4 percent in after hours trading to $40.49.
Chief Executive Dan Schulman said competition is heating up in mobile payments, and investing in PayPal's own offerings has become "increasingly important" to gain an advantage over rivals.
"Payments are rapidly digitizing," he said. "Mobile is redefining the face of retail."
The San Jose, California-based company's earnings report came on the same day Ant Financial Services, an affiliate of Chinese e-commerce company Alibaba Group Holding Ltd (BABA.N: Quote) said it would acquire U.S. money-transfer company MoneyGram, in a deal that is expected to shake up the international payments landscape.
Ant, the world's largest financial-technology company, has been expanding at home and overseas as it prepares for a planned initial public offering later this year. Continued...