PayPal Core Checkout Loses Steam And The Market Notices - PayPal Holdings (NASDAQ:PYPL)

Core Insights - PayPal Holdings, Inc. is experiencing ongoing softness in consumer spending, raising concerns about its turnaround pace [1][4] - Bank of America Securities analyst Mihir Bhatia downgraded PayPal from Buy to Neutral, reducing the price target from $93 to $68 due to slower progress in revitalizing branded checkout growth [1][2] Company Performance - Product upgrades and a refreshed checkout experience have not yet led to the anticipated increase in button usage [2] - The fourth quarter is expected to show a significant slowdown in branded checkout growth, marking the weakest expansion in several years [3][5] - PayPal has flagged continued softness in consumer spending into November, which contrasts with generally positive retail updates [4][6] Market Position - Concerns are growing that PayPal may be losing market share to rival digital wallets and alternatives, as its branded checkout volumes have lagged behind broader e-commerce benchmarks [5] - The risk-reward profile appears balanced until clearer evidence of a turnaround is observed [3] Financial Outlook - Earnings forecasts for 2026 and 2027 have been lowered to reflect slower growth and increased investment spending, with potential downside risk if 2027 remains investment-heavy [6] - PayPal's customer base is primarily middle- and lower-income households, which are more exposed to retail and discretionary spending [6]