PayPal's China, Europe transaction volumes hit by strong dollar
By Arathy S Nair
(Reuters) - Payment processor PayPal Holdings Inc (PYPL.O: Quote), spun off from eBay Inc (EBAY.O: Quote) reported quarterly revenue slightly below analysts' expectations as a strong dollar hurt its transaction volumes in China and Europe.
Shares of PayPal, which listed for the second time on the Nasdaq in July, fell 5.6 percent in extended trading on Wednesday.
PayPal's third-quarter revenue rose about 14 percent to $2.26 billion, nearly half of which came from markets outside the United States.
Excluding the impact of a strong dollar, revenue rose 19 percent, but missed the average analyst estimate of $2.27 billion, according to Thomson Reuters I/B/E/S.
"I think that the foreign exchange impact has been larger than expected," Susquehanna Financial Group analyst James Friedman said.
PayPal said it expected the dollar to have a bigger impact on its 2015 revenue than previously anticipated. The company forecast a growth of 15-18 percent in full-year revenue, excluding the impact of a strong dollar.
Wedbush Securities analyst Gil Luria also attributed the fall in PayPal's shares to likely high investor expectations after strong results from eBay.
PayPal said growth in its international total payment volumes was hurt somewhat because of weakness in China and Europe. Continued...