# PayPal leaves room for a higher offer after earnings beat and AI savings update > Source: > Published: 2026-07-29 11:52:18.530778+00:00 # PayPal leaves room for a higher offer after earnings beat and AI savings update - Stripe and Advent International reportedly offered $60.50 a share, valuing PayPal at more than $53 billion. PayPal has not confirmed the proposal, while Reuters reported that its board considers the price inadequate. [[1]](https://ca.investing.com/news/stock-market-news/paypal-presses-on-with-turnaround-in-pivotal-quarter-as-sale-questions-linger-4756317) - CEO Enrique Lores said the board and management remain “open and objective” and would consider an opportunity that creates more value than PayPal’s standalone strategy. [[2]](https://ng.investing.com/news/transcripts/earnings-call-transcript-paypal-beats-q2-2026-estimates-as-growth-plans-take-shape-93CH-2620979) - PayPal reported $8.68 billion in quarterly revenue and adjusted earnings of $1.38 a share, both above consensus estimates, and raised full-year adjusted EPS guidance to about $5.38. [[3]](https://s205.q4cdn.com/875401827/files/doc_financials/2026/q2/PYPL-2Q-26-Earnings-Presentation.pdf) - PayPal attributed roughly 40% of its targeted $1.5 billion in gross run-rate savings to accelerated AI adoption and said AI-assisted coding has reduced implementation time by 25%. Those are company-reported measures, not independently validated results. [[3]](https://s205.q4cdn.com/875401827/files/doc_financials/2026/q2/PYPL-2Q-26-Earnings-Presentation.pdf) PayPal left room for a higher takeover offer Tuesday after reporting better-than-expected second-quarter results and providing new detail on the role of artificial intelligence in its cost-cutting program. CEO Enrique Lores declined to discuss a reported bid from Stripe and Advent International, citing PayPal’s policy against commenting on market speculation or potential merger talks. He nevertheless said the board and management remain “open and objective in evaluating opportunities.”[[2]](https://ng.investing.com/news/transcripts/earnings-call-transcript-paypal-beats-q2-2026-estimates-as-growth-plans-take-shape-93CH-2620979) “If we see levers or a path that we believe would create superior value for our shareholders than executing our current strategy, we would, of course, carefully consider them,” Lores told investors.[[2]](https://ng.investing.com/news/transcripts/earnings-call-transcript-paypal-beats-q2-2026-estimates-as-growth-plans-take-shape-93CH-2620979) The language did not amount to confirmation that PayPal is negotiating a sale. It did establish the board’s stated standard: compare any proposal presented to the company with the value management expects from its multiyear turnaround. ## The reported bid still sits above PayPal’s share price Reuters reported on July 15 that Stripe and Advent jointly offered $60.50 for each PayPal share, valuing the company at more than $53 billion. The offer was backed by about $50 billion in committed bank financing and contemplated equal ownership by the two bidders rather than a breakup of PayPal, according to the report.[[1]](https://ca.investing.com/news/stock-market-news/paypal-presses-on-with-turnaround-in-pivotal-quarter-as-sale-questions-linger-4756317) PayPal has not publicly confirmed the bidders, price, financing or status of any discussions. Reuters reported separately that the board considers the offer inadequate. Bloomberg reported that PayPal has been working with Goldman Sachs and Evercore to review strategic alternatives, including a possible sale or breakup.[[1]](https://ca.investing.com/news/stock-market-news/paypal-presses-on-with-turnaround-in-pivotal-quarter-as-sale-questions-linger-4756317)[[4]](https://news.bloomberglaw.com/business-and-practice/stripe-advent-offer-to-buy-paypal-for-53-billion-reuters-says) PayPal shares closed Tuesday at $58.32, up 4.01%, leaving the stock about 3.7% below the reported offer price. [5] The market reaction reflected both the earnings beat and Lores’ refusal to rule out a transaction. The shares had already posted their largest move of the year when the bid was reported earlier in July. [[1]](https://ca.investing.com/news/stock-market-news/paypal-presses-on-with-turnaround-in-pivotal-quarter-as-sale-questions-linger-4756317)Lores gave more explicit language during the question-and-answer session. He said the board and management have a responsibility to “objectively evaluate every opportunity that is presented to us, compare it with our own plan, and choose the option that creates more value.” For now, he added, PayPal’s focus remains its standalone plan.[[2]](https://ng.investing.com/news/transcripts/earnings-call-transcript-paypal-beats-q2-2026-estimates-as-growth-plans-take-shape-93CH-2620979) ## Earnings strengthened the standalone case, but margins remain under pressure PayPal reported second-quarter revenue of $8.68 billion, up 5% year over year and 3% on a currency-neutral basis. Adjusted earnings were $1.38 a share, compared with the $1.28 consensus estimate. Total payment volume increased 10% to $486.4 billion, or 9% excluding currency movements.[[3]](https://s205.q4cdn.com/875401827/files/doc_financials/2026/q2/PYPL-2Q-26-Earnings-Presentation.pdf)[[6]](https://www.investing.com/news/company-news/paypal-q2-2026-slides-detail-threephase-turnaround-strategy-93CH-4816986) Management raised full-year adjusted earnings guidance to approximately $5.38 a share and now expects transaction-margin dollars of about $15.6 billion, or $14.5 billion excluding interest on customer balances. It also raised its full-year forecast for online branded-checkout volume to low-single-digit currency-neutral growth.[[3]](https://s205.q4cdn.com/875401827/files/doc_financials/2026/q2/PYPL-2Q-26-Earnings-Presentation.pdf) The operating results were uneven. Online branded-checkout volume grew 2% on a currency-neutral basis for a second consecutive quarter. Venmo payment volume grew 14%, while Braintree continued to expand in the mid-teens. Venmo debit-card monthly active accounts increased more than 50%, and Pay with Venmo monthly active accounts grew approximately 30%.[[2]](https://ng.investing.com/news/transcripts/earnings-call-transcript-paypal-beats-q2-2026-estimates-as-growth-plans-take-shape-93CH-2620979)[[3]](https://s205.q4cdn.com/875401827/files/doc_financials/2026/q2/PYPL-2Q-26-Earnings-Presentation.pdf) Customers using both Venmo Debit and Pay with Venmo generated more than nine times the average revenue per account of peer-to-peer-only users, management said. That cohort roughly doubled over the past year, although PayPal did not disclose its size or its contribution to total revenue.[[2]](https://ng.investing.com/news/transcripts/earnings-call-transcript-paypal-beats-q2-2026-estimates-as-growth-plans-take-shape-93CH-2620979) Profitability absorbed the cost of the restructuring and growth investments. Non-GAAP operating income fell 8% to about $1.5 billion, while adjusted operating margin contracted 248 basis points to 17.4%. Adjusted free cash flow was $1.83 billion, and PayPal repurchased $1.5 billion of stock during the quarter.[[3]](https://s205.q4cdn.com/875401827/files/doc_financials/2026/q2/PYPL-2Q-26-Earnings-Presentation.pdf)[[6]](https://www.investing.com/news/company-news/paypal-q2-2026-slides-detail-threephase-turnaround-strategy-93CH-4816986) ## PayPal put numbers around the AI portion of its turnaround The original draft understated the AI disclosures. PayPal is targeting at least $1.5 billion in gross run-rate savings over the next two to three years and expects approximately $400 million of run-rate savings by the end of 2026.[[3]](https://s205.q4cdn.com/875401827/files/doc_financials/2026/q2/PYPL-2Q-26-Earnings-Presentation.pdf)[[6]](https://www.investing.com/news/company-news/paypal-q2-2026-slides-detail-threephase-turnaround-strategy-93CH-4816986) Management attributed roughly 40% of the total savings target to accelerated AI adoption. The remaining savings are expected to come from organizational simplification, workforce-location changes, portfolio optimization and lower spending on marketing, vendors and outside services.[[3]](https://s205.q4cdn.com/875401827/files/doc_financials/2026/q2/PYPL-2Q-26-Earnings-Presentation.pdf) PayPal also said AI-assisted coding has reduced implementation time by 25%. It plans to expand AI and automation across technology development, risk, operations, fraud prevention, customer support and workforce planning.[[3]](https://s205.q4cdn.com/875401827/files/doc_financials/2026/q2/PYPL-2Q-26-Earnings-Presentation.pdf) Those figures provide a clearer operating benchmark, but they remain management estimates and internal performance measures. PayPal did not disclose the baseline period, sample of projects or methodology behind the 25% implementation-time improvement, and it has not separately reported realized profit attributable to AI. The company’s broader restructuring includes removing organizational layers, migrating from owned data centers to the cloud and consolidating technology onto a more modular platform. Management expects agentic payments and digital identity to become more meaningful contributors beginning in 2028, making them longer-term elements of the investment case rather than drivers of the current earnings beat.[[2]](https://ng.investing.com/news/transcripts/earnings-call-transcript-paypal-beats-q2-2026-estimates-as-growth-plans-take-shape-93CH-2620979)[[3]](https://s205.q4cdn.com/875401827/files/doc_financials/2026/q2/PYPL-2Q-26-Earnings-Presentation.pdf) ## Companies mentioned ## Further sources [[1] Reuters, “Stripe, Advent offer to buy PayPal for more than $53 billion, sources… ↗](https://ca.investing.com/news/stock-market-news/paypal-presses-on-with-turnaround-in-pivotal-quarter-as-sale-questions-linger-4756317) [[2] PayPal second-quarter 2026 earnings-call transcript, July 28, 2026. ↗](https://ng.investing.com/news/transcripts/earnings-call-transcript-paypal-beats-q2-2026-estimates-as-growth-plans-take-shape-93CH-2620979) [[3] PayPal second-quarter 2026 earnings presentation, July 28, 2026. ↗](https://s205.q4cdn.com/875401827/files/doc_financials/2026/q2/PYPL-2Q-26-Earnings-Presentation.pdf) [[4] Bloomberg Law, “PayPal Is Said to Work With Goldman, Evercore as Suitors Circle… ↗](https://news.bloomberglaw.com/business-and-practice/stripe-advent-offer-to-buy-paypal-for-53-billion-reuters-says) [[5] MarketScreener market data for PayPal’s July 28, 2026 regular session close. ↗](https://ca.marketscreener.com/news/transcript-paypal-holdings-inc-q2-2026-earnings-call-jul-28-2026-ce7f51ddde8bf223) [[6] Reuters and PayPal earnings materials covering second-quarter results and 2026 … ↗](https://www.investing.com/news/company-news/paypal-q2-2026-slides-detail-threephase-turnaround-strategy-93CH-4816986) The stories that matter, in one email. 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