PayPal Jumps 9% on ChatGPT Payments Deal and Raised Outlook

Core Insights - PayPal's shares increased over 9% intra-day following the announcement of a partnership with OpenAI to integrate PayPal's wallet into ChatGPT and an upward revision of its full-year guidance [1][2] Group 1: Partnership with OpenAI - PayPal finalized an agreement with OpenAI to allow users to make payments for items found within ChatGPT using PayPal [2] - Merchants will be able to sell on the ChatGPT platform starting next year, with PayPal managing merchant routing, payment validation, and back-end orchestration [2] - The company plans to enhance its AI strategy by providing access to ChatGPT's enterprise offerings for its over 24,000 employees [2] Group 2: Financial Performance - For Q3, PayPal reported adjusted EPS of $1.34, exceeding Bloomberg consensus estimates, and net revenue of $8.42 billion, also above forecasts due to stronger-than-expected total payment volume [3] - Transaction margin dollars increased by 5.9% year-over-year to $3.87 billion, surpassing estimates of $3.78 billion [3] Group 3: Revised Guidance - PayPal raised its full-year adjusted EPS guidance to a range of $5.35–$5.39 from a previous range of $5.15–$5.30, which is above the Bloomberg consensus of $5.25 [4] - The outlook for full-year transaction margin dollars was lifted to a range of $15.45–$15.55 billion from $15.35–$15.50 billion [4]