PayPal at Citi's FinTech Conference: Strategic Shifts and Challenges

On Wednesday, 19 November 2025, PayPal Holdings Inc. (NASDAQ:PYPL) participated in Citi's 14th Annual FinTech Conference, where CEO Alex Chriss highlighted the company's strategic progress and challenges. While PayPal is stronger than two years ago with improvements in transaction margins and the processing business, the growth in branded checkout has been slower than anticipated. Chriss addressed the economic slowdown impacting consumer spending and outlined plans to capitalize on Buy Now, Pay Later (BNPL) and agentic commerce.

Key Takeaways

• PayPal anticipates a 6% to 7% growth in transaction margins this year.
• BNPL volume is projected to reach $40 billion in 2025.
• Venmo's revenue is set to surpass $2 billion soon.
• The economic slowdown is expected to affect Q4 branded checkout growth.
• Strategic investments in agentic commerce and BNPL are prioritized.

Financial Results

• Transaction margins are on track for 6% to 7% growth in 2025.
• The processing business has turned positive after previous losses.
• Venmo revenue is expected to eclipse $2 billion shortly.
• BNPL volume is forecasted to hit $40 billion this year.
• Venmo debit card volume grew by 65%, and "Pay with Venmo" volume increased by 40%.

Operational Updates

• Venmo has focused on partnerships with brands like Taco Bell and Sephora, enhancing its role as a digital wallet.
• Branded checkout has been optimized, but legacy integrations have slowed progress.
• PayPal's PSP business has improved margins through value-added services and contract renegotiations.
• BNPL is moving upstream to product pages, with an expected 10% lift in conversion.

Future Outlook

• PayPal plans to invest in agentic commerce and BNPL, which may affect transaction margin growth in 2026.
• The company aims to accelerate the rollout of the new checkout experience by 2026.
• Interoperability between Venmo and PayPal is set to enhance user experience.

Q&A Highlights

• Chriss emphasized the importance of meeting customers across various payment methods, including online and in-store.
• PayPal is committed to leveraging its trusted network for agentic commerce opportunities.
• Strategic investments are seen as crucial to capturing generational shifts in commerce.

For more detailed insights, readers are encouraged to refer to the full transcript.

Full transcript - Citi's 14th Annual FinTech Conference:

Brian Keene, Head of U.S. Research Practice, Citi: Thanks for coming to this session with PayPal. My name's Brian Keene. I head up the U.S. research practice here at Citi, and we're really excited to have Alex Chriss here, who's the CEO of PayPal. So we will do a fireside chat here, but Alex, thanks for coming.

Alex Chriss, CEO, PayPal: Oh, it's great to be here. Really good to see everyone and appreciate you having me.

Brian Keene, Head of U.S. Research Practice, Citi: Sure. I was thinking maybe we'd start with a little state of the union, Alex. It's been a little over two years that you've been at PayPal as president and CEO, and what kind of progress report would you give the company over the past two years?

Alex Chriss, CEO, PayPal: Yeah, well, it has been two years. I think we're still early in our transformation, but I would say today we are a fundamentally stronger company than we were two years ago. If you think about something like transaction margin, we've inflected that from negative to we're on pace for 6% to 7% transaction margin growth this year. We've turned around almost every part of the business. So our processing business was negative. We've now turned that positive. Went through some really good discussions with our merchants to turn that business around. Our Venmo business, which had been stagnant but just so incredible as an asset, is now growing and delivering really exciting results. And branded checkout, we've invested in the experience and very excited about where the experience is going.

But to be transparent, that's probably the piece I underestimated the most in terms of just how long it would take to get that experience out to customers. So if I were to be constructively dissatisfied, I think getting the experience out to customers has gone slower than I expected. So good first couple of years, but again, this is going to be a good transformation for us to get through, but again, stronger today than we were a couple of years ago.

Brian Keene, Head of U.S. Research Practice, Citi: Yeah, yeah, we'll talk about some of those pieces of business. One of the things you talked about at the Analyst Day was the vision to enable commerce, connecting merchants and consumers. How's the progress, you think, on the big picture of PayPal becoming a commerce platform?

Alex Chriss, CEO, PayPal: Yeah, so one of the things that drew me to PayPal was we are really the only company that has two sides of the ecosystem, the consumer ecosystem and the merchant ecosystem at scale. And I think previously we'd done well to grow each of them, but not really connect the dots. And so part of the vision that we laid out at our Analyst Day was how do we leverage this ecosystem and build a network effect between our consumers and our merchants? And so we're still, again, early in that journey, but I'll give you a couple of examples. So we rolled out a partnership with the Big 12 and the Big 10 to actually distribute payments through payouts for NIL athletes to Venmo. That's something that was unique to us. The reason we got that deal was because there's so many Venmo users on college campuses.

We have an incredible payouts product through our processing business, but we won that deal because we could actually put money into a consumer wallet that now puts money into the consumer ecosystem. So we won the deal for a reason, because we had the consumer ecosystem, and then it just drew more money into the ecosystem for our users to be able to spend money on. So it's just an example. I'll give you another one. We have a number, we have a commerce API now that our merchants are using to be able to actually get access to consumer information at the very beginning of a commerce journey. So as soon as a consumer shows up on a site, they're able to ping our API and say, "Who is this user? What information do you have about them?

How do I now personalize my e-commerce experience?" Because PayPal has seen this user before and knows their purchase history. So we're working with merchants to not just enable a frictionless checkout experience, but really move upstream in terms of creating that full end-to-end commerce journey. And it's fundamentally changed the nature of the conversations we have with merchants because they're now looking to us as a partner that can really help them drive new customers and drive conversion beyond just the payment.

Brian Keene, Head of U.S. Research Practice, Citi: That's really helpful. I want to ask about the macro. I think PayPal called out a little bit of weakness in discretionary spend in the U.S. and Europe. There's also tougher comps, I know, from last year. Can you just talk a little bit about what you're seeing in the health of consumer spending?

Alex Chriss, CEO, PayPal: Yeah, so obviously, as a business, we are going to control what we can control and continue to execute on our strategy. But we called out sort of mid Q3 that we started to see a slowdown on consumers, particularly around discretionary spending, retail, and really in middle to low-income brackets, which we play a significant role in PayPal. That slowdown has persisted into Q4. There's a lot of holiday shopping to still come in Q4, so we'll see what happens. But what we've seen so far is that there's a lot of pressure on consumer right now. This is across U.S. and Europe, and it has persisted into Q4, and we expect that to have an impact on branded checkout. So we said this, and I still expect branded checkout in Q4 to grow, but grow slower than Q3 if this persists.

Brian Keene, Head of U.S. Research Practice, Citi: And is that the change in the consumer, has that just been sudden, or have you seen it throughout this year that they've become a little more stretched?

Alex Chriss, CEO, PayPal: You know, it really became more pronounced mid-September. And we've been watching this very closely. Obviously, there's a lot going on in the macro right now that's been tightening for consumers. And again, it is differentiated. If we look at some of our cohorts of higher-income spenders, they're still spending, but we are seeing pressure for middle to lower-income, and we're also seeing a shift to buy now, pay later, which for us is an opportunity to take share. We have a tremendous buy now, pay later product and one that, with the data that we have, we think we can really put in front of consumers at the right time to help them make the purchases they need and spread those payments over a couple of paychecks if they need to. But it really started mid-September and has persisted.

Brian Keene, Head of U.S. Research Practice, Citi: Yeah, you started out talking about some of the things going well and then the challenge of maybe branded checkout, which we'll go to. But I wanted to start with some of the things that are really going well right now for PayPal, and one of them is BNPL that you just called out. So I think BNPL, both volume and MAA, grew 20%. I think it's expected to be about a $40 billion volume business this year. What have you seen for overall kind of differentiation that PayPal can provide, and how can you push BNPL to be even a bigger piece of the PayPal pie?

Alex Chriss, CEO, PayPal: Yeah, so we're really excited about BNPL. We see this as actually a generational shift. We're seeing a younger cohort, a younger demographic really leaning towards debit and buy now, pay later as their preferred methods and moving away from credit card as a way to fund their purchases. So we think that's an exciting sort of generational tailwind that'll happen. And then, as you said, we're on track to do $40 billion or so in buy now, pay later. Much of that has happened actually post-button click. So what that means is you're on a checkout page, you see PayPal, you click on PayPal, and we give you a pay sheet of which one of those options is buy now, pay later. So almost all of our volume has been post that selection.

What we're hearing from consumers and from merchants is we actually want to see what our buy now, pay later option is up on the checkout page, on the product page before the checkout page. And we see a significant increase when we're on that product page. So we're going to move upstream from a presentment perspective. We're going to move PayPal as a pay later option onto the product page so that consumers can actually see what that pay in for, as an example, price would look like for the good that they're looking at. And we see, I think right now we're seeing a 10% lift in conversion when we are up on that product page. And so that's going to be a strategic shift for us, which we think will actually accelerate.

As you said, we're seeing significant growth right now in buy now, pay later because of the brand that we have, because of the trust that we have, because of the data and loyalty that we have from our customers. We think once we actually move upstream, we're going to see accelerated growth from buy now, pay later. So we're going to lean in there.

Brian Keene, Head of U.S. Research Practice, Citi: We just had Klarna on the data presentation before you got here, and then, of course, Affirm. We're seeing huge growth in their cards. You guys obviously have great growth in your cards too. What do you think about the whole strategy of pushing more transactions so that the consumer can have the choice of a debit transaction versus a buy now, pay later transaction and growing that? Helps with PayPal anywhere, helps moving you into getting into offline as well?

Alex Chriss, CEO, PayPal: Yeah, I mean, if you just pull back and think about the strategic shift that we've made as PayPal over the last two years, two years ago, you really thought of PayPal as a pay now e-commerce option. And you fast forward two years, and we are meeting customers where they are. So we are now pay now, pay later. We're pay online, we're pay in store, and we're pay agentically. And so being able to meet customers wherever they are, we have launched our offline capabilities and seeing tremendous growth in our debit card, both for PayPal and for Venmo. We're seeing growth that we just talked about in buy now, pay later. And so for us, customers, they are making sure that they can pay however they want. There are some purchases where pay now in store makes perfect sense.

They can use our debit card and have that transaction happen. There's somewhere they want to be able to pay later and do that in store or online. We've got a great buy now, pay later option for them. So we've expanded buy now, pay later in store as well. So this is just part of our overall strategy, and we're leveraging the brand that we've built over 25 years with PayPal and the incredible brand of Venmo in the U.S. to, again, meet customers where they are, and we want to be the right purchase for them everywhere, every time.

Brian Keene, Head of U.S. Research Practice, Citi: One of the things that's definitely turned in the last couple of years since you've been there is Venmo in general. For 10 years, we've been talking, I feel like, that Venmo was going to finally scale and turn, and I feel like it's hit an inflection point. I guess the first question to me is, maybe you can help us understand what's been the difference. How did we finally maybe hit an inflection point in Venmo where we talked about it for years before you got here, and we never saw any really growth in pay with Venmo or growth in the debit card, which is now both of them are growing 40% in volume in pay with Venmo, and the debit card, I think, grew 65% in volume.

Alex Chriss, CEO, PayPal: Yeah, I mean, Venmo is just an absolutely incredible asset. It's rare that you get something that is a verb for one of the most attractive demographics of young, affluent spenders. The turnaround is exciting. It's about focused execution. We've gone out and really focused on verticals that matter to this demographic, so ensuring that partners like Taco Bell and Sephora are places where we can ensure that a demographic that wants to have their discretionary spend used through their Venmo ecosystem, they now have that opportunity. So we've invested in the debit card. We've invested in pay with Venmo. We've invested in partnerships. We just launched a partnership with Bilt so that our ecosystem can now start to split their rent and pay it with their friends through the Venmo app.

And really, if you think about the transformation we've gone through, we were seeing $18 billion of funds coming into the Venmo ecosystem every month through peer-to-peer transactions. Almost all of that would then exit the ecosystem. That was just an incredible sign that we weren't giving our consumers the opportunity to make the spend that they needed within the app. They were using us for peer-to-peer. It was the best way for them to share money with their friends and family, but they weren't seeing the opportunities to spend once it was in their wallet. That has now turned around.

We're actually seeing a significant increase in consumers that are bringing new funds into the ecosystem outside of peer-to-peer, so their direct deposit or other bank transfers into Venmo because they now see Venmo as that wallet for them to do all of their spending, again, online, in store with their debit card, pay with Venmo. So we think we're just scratching the surface there. If you really look at the ARPA that we have with Venmo, it is increasing while our consumer base continues to increase, but we're still just scratching the surface of what we think it could be. So very, very exciting. We're on track to eclipse $2 billion in revenue from Venmo in the near term, and we think we're maybe a quarter to a fifth of the ARPA potential that Venmo has. So focused execution, we're going to continue to lean in there.

Brian Keene, Head of U.S. Research Practice, Citi: Yeah, I think pay with Venmo is now $10 billion in volume or will be thereabouts in fiscal year '25. What's the key now to hit the next level of growth? Is it more merchant acceptance, getting the consumer comfortable with using their card? And is this going to look like PayPal maybe 20, 30 years ago?

Alex Chriss, CEO, PayPal: Yeah, so there's a couple of things. One, we want to make sure we've got focused execution on verticals that matter to this cohort. So we will have very specific merchants that are coming in that are offering cashback offers. Remember, this demographic is incredibly valuable to merchants. And so what we're seeing is merchants leaning in and wanting to create offers inside of the Venmo application. This goes back to that commerce platform that we talked about earlier, wanting to give cashback or discounts to this population to drive purchasing, and now they can do it online or in store. The second big unlock is going to be what we've rolled out with PayPal World, which is connecting PayPal, Venmo, UPI, WeChat, Mercado Pago, and a number of other wallets around the world into an interoperable ecosystem. So what does that actually mean?

Well, for the first time, a Venmo user and a PayPal user can actually move money with each other. For the first time, a Venmo user will now be able to click on any PayPal button on any merchant and make a purchase. So we will instantly open up the world of the entire PayPal merchant ecosystem to every Venmo user. So we don't have to go one by one and unlock every single merchant to now add a pay with Venmo button. We can leverage the entire ecosystem that PayPal has. So we think this is now we've created the ecosystem. We have an incredible, valuable base that is bringing money into their wallets, and now we've given them millions and millions of merchants to be able to go spend on. So we think we're going to see a significant unlock there with pay with Venmo.

Brian Keene, Head of U.S. Research Practice, Citi: And when is that PayPal World and the volume and the transactions? When will we see that interoperability?

Alex Chriss, CEO, PayPal: Yeah, it's starting now. It'll come over the next couple of quarters when we really roll it out. We started to do some early peer-to-peer testing of PayPal and Venmo money, but this is all within the next couple of quarters.

Brian Keene, Head of U.S. Research Practice, Citi: Awesome. I wanted to turn to the PSP business, the old we think about it as the brain tree. It grew 6% FX neutral. Obviously, that was a business when you came and inherited. It was losing money on a transaction margin dollar basis, and you've been able to turn that business. Can you talk a little bit about how you were able to fix the pricing issue there and how can that business maybe gain share versus competition?

Alex Chriss, CEO, PayPal: Yeah. So as a reminder, and you touched on it, when I got here, the processing business was growing customers, but growing customers at negative margin. And we were providing some value-added services, but really giving them away in order to drive incremental processing revenue, but again, at low to negative margins. That's just not a healthy business, and we called early on that we were going to turn that around. So I'm very proud of the execution of the team. We've done a couple of things. One, we've invested in value-added services, things like risk as a service, FX as a service, payouts that I mentioned earlier. These are now best-in-class value-added services. We've gone back and renegotiated our contracts with our largest merchants. Those were difficult conversations, renegotiating and pricing to value, but I'm very proud we didn't lose any merchants.

They saw the value in our processing, and they saw the value in the value-added services that we have. And having done that, we actually reduced the total processing that we were demanding from them, but have made it much healthier margins as we move forward. So now we feel like we've inflected on revenue. We see that continuing to grow, and we think transaction margin will continue to grow as well. So very, very excited. Difficult couple of years to go through that process, but it was the right thing for the long term of the company. And if you just step back, what I'm excited about is this really changes the profile of PayPal. We now have multiple levers for growth across transaction margin. It's not just branded checkout. Now we are growing transaction margin through our processing business, through Venmo, through buy now, pay later.

So we now have multiple levers for us to be able to grow, and it just creates a healthier profile for us for the future.

Brian Keene, Head of U.S. Research Practice, Citi: In that PSP business, can the transaction margin dollar grow equal to the volume growth, or will there always be a little bit of a lag there?

Alex Chriss, CEO, PayPal: We think volume will grow. Our focus is to grow at or above e-commerce trends. And I would go back and look at what we said in our investor day. We're on track for that kind of profile for '27 in the PSP business.

Brian Keene, Head of U.S. Research Practice, Citi: Yeah, I think it was the goal of doing 2X the amount of transaction margin dollars by fiscal year '27.

Alex Chriss, CEO, PayPal: That's right.

Brian Keene, Head of U.S. Research Practice, Citi: Let's get to branded checkout. So I think you called fixing checkout as one of the top priorities on your list. You mentioned to begin with, maybe that was one area that you underestimated to turn that business. So as you know, the street's hypersensitive on this number. Online branded growth has been 5% in the third quarter, and you talked a little bit about due to economic considerations, that's going to probably be a little bit lower here in the fourth quarter. The current initiatives are to drive checkout scaling, redesign the pay sheet from 20% global branded traffic to 80% by '27. I guess help us understand why the progress has been maybe slower than expected, and is that enough? If you can upgrade online checkout, will you see an inflection point when you get towards that 80% target?

Alex Chriss, CEO, PayPal: Yeah. So I will answer that question. First, I know everyone is hyper-focused on branded checkout. I would love for folks to understand strategically that what we talked about earlier, we are playing a bigger game than just online. We are now meeting customers where they are. And if you look at the metrics that we're putting out on branded online experiences, this is really an omnichannel play. So we have to solve branded checkout from an online perspective, but I would encourage you all to look at what we're driving from an offline experience as well, because that's driving buy now, pay later. It's driving branded experiences. We drew branded experiences 10% of the U.S. last quarter, which was double the year before. So we're really starting to see penetration of offline checkout. Now, to your question on branded online, there's three components to branded online.

Two we've already talked about: pay with Venmo, which we've talked about the growth there. Buy now, pay later, we've talked about the growth there. Then you come down to the core of the PayPal button. And I've been transparent when I got here, that experience, particularly on mobile, was below my expectation and really below competition. It was full of friction. It was using really almost a decade-old experience for consumers, where it would be you'd be on a mobile device, you'd click to checkout with PayPal, and we would ask you for your username or email, your password, would do two-factor authentication. I mean, just full of friction in an experience where customers are looking for one-click checkout. So what I'm very proud of is we have gone through and rebuilt that experience.

We're now leveraging what sounds obvious, but important technology like passkeys to ensure that you're now using Face ID, you're able to actually just checkout with one click. So for that experience, where we have rolled that out and optimized it, we are seeing the lift that we expect. We're talking about over a point of conversion improvement, and where passkeys are really there, it can be as much as two to five points of improvement. So we know that this new experience works. The challenge is we have 15-plus years of really bespoke integrations across our merchant base. And this was something I personally didn't appreciate when I got here, of just how many different integration patterns there have been and how hard this was going to be. So we have started the process. We are 20-plus percent of the way through.

We've optimized about half of that, call it mid-teens of the total transaction volume. It's now being rolled out in the U.S. and across Europe. It's just slower than I want. So good news is it works. Bad news is it's taking some time. My expectation is we will continue to accelerate this through '26, and there will be a point where we actually go from the carrot moment with our merchants where, hey, this is an improved experience into the stick moment of we're deprecating our old integrations. I just don't want to live in an environment anymore where we have 15 years of legacy integrations. It's expensive for us to maintain, and it's a terrible experience for customers. And so we will march through this. I wish it were a quick fix. I wish I could flip a switch.

We'll never go through this again because we now have a single common integration pattern, but we're just going to have to go through the hard work over the next few quarters and maybe even a couple of years to get through our backlog of merchants.

Brian Keene, Head of U.S. Research Practice, Citi: When you start to roll this out in Europe, what are some of the challenges? Is it by country, and it just makes it more difficult to roll out the new checkout?

Alex Chriss, CEO, PayPal: No, it's not really a geography issue. It's a merchant integration issue. We did not have discipline over the last 15 years of having and demanding consistent integration patterns. We let every merchant choose their own. So now as we go through and ask them to make a change, there's not just one set of instructions to go do it. We've got to go through their code and help them go through the upgrade. And again, it's not that that work is excruciatingly hard. It's just that it's not consistent. So we can't just put a single set of instructions out and just run through the entire merchant base. We have to go through different patterns. So we've started with some of the largest merchants. Those are going incredibly well. And again, when we've done the upgrade, the conversion rate improves.

We've gone through some of our platform partners that then can roll it out to millions of their businesses. That's going really well, but we've just got to get through the backlog.

Brian Keene, Head of U.S. Research Practice, Citi: So you talked about doing a carrot for another year or so, and then you're going to have to come with the stick. How would you do that? Would you just say, hey, you have to upgrade? There's no longer you can be on the old system?

Alex Chriss, CEO, PayPal: Yeah, I mean, I've done this before in my career. At some point, you deprecate the old integration patterns, and you no longer support it. And so the only way you can do that is if you have confidence that the improvement is better for customers and for merchants. We know and we have the data that shows that this is an improved experience, and it will improve conversion. So I feel very confident about deprecating an old experience when I can tell a merchant, this is going to improve your conversion rate. This is going to put more money in your pocket, and it's going to improve your consumer experience. So I will feel very good about that. But these merchants all have lots of priorities, and this may not be their top priority.

When we help them see that the improvement is there and we're deprecating the old experience, we'll move through the backlog.

Brian Keene, Head of U.S. Research Practice, Citi: And how would you do that? Would you put a date out like, hey, June of '27?

Alex Chriss, CEO, PayPal: Yeah, give people time and work through it.

Brian Keene, Head of U.S. Research Practice, Citi: Got it. One of the things I'm always thinking about is driving the online branded checkout experience through more loyalty program or merchant incentives. Or if I gave you all the marketing dollars possible, can you do those things within a budget that makes sense to help drive even faster online branded checkout?

Alex Chriss, CEO, PayPal: Yeah. I mean, look, we are at a point now where we're really excited about the experience that we've put out. We've invested in ensuring that things like buy now, pay later are best in class. Our NPS for our buy now, pay later product is 80-plus. I mean, it's one of the highest NPSs I've ever seen. And so now we have confidence that we can spend. And as I talked about earlier, when we want to have either cashback or presentment upstream for our consumers to be able to choose and habituate with PayPal, we may need to spend into that. And we're doing it now with 5% back on buy now, pay later purchases through the holidays. Those are things that we want to continue to invest in because it drives consumer habituation, and it drives significant ROI for the long term.

Brian Keene, Head of U.S. Research Practice, Citi: Yeah, I was going to ask about the spending, and you talked about it on the quarterly call that there will be more investments in the fourth quarter with some of the rewards and cashback, better placement, presentment. Can you talk about how you see the return on the investment there? And could '26 be a year of more investment where you keep margins maybe flat? I have no idea what the thought is, but use as much of those investments as possible to help spur the other top-line growth.

Alex Chriss, CEO, PayPal: Yeah. So what I'm excited about is over the last two years, we've repositioned the company to be able to have this kind of optionality. As we talked about at the beginning, we went from negative margins to now being able to drive and have confidence that we're on a great path this year, 6% to 7% transaction margin growth. And we know we could continue to invest in driving a very healthy profile. We also know that there are some big shifts in the market that we want to take advantage of, whether it's buy now, pay later, whether it's agentic. There are some elements where we want to lean in and make sure that we are in a winning position going forward. And that will likely come with some investment. Now, those investments, if it's incentives for consumers to make purchases, come at a headwind to transaction margin.

And so we will make those investments in the short term to be able to drive long-term habituation and win the market going forward. Where we think we've got a best-in-class product and can take share, if we have to invest now to drive ROI for the next 3, 5, 10 years and set PayPal up for the future, those are the investments we'll make through '26.

Brian Keene, Head of U.S. Research Practice, Citi: Yeah, because I was trying to figure out from the analyst day what you put out in terms of disclosures for EPS growth and margin growth and transaction margin dollars. Does it make sense maybe to, given the opportunity and given where you are, maybe to change that model and invest for the growth instead of trying to drive more dollars to the bottom line?

Alex Chriss, CEO, PayPal: Yeah, I think if I think about the profile of what we talked about at analyst day, macro aside, just the profile of what we talked about, we still have confidence that it is the right profile for the long term of the company. But a lot has changed, and this is never going to be a linear path. If I even think back to February when we did analyst day, I didn't get a single question about agentic. And now in most of my conversations with everyone, it's half the conversation. And so that is an opportunity for us to lean in and win in agentic, to win in buy now, pay later, and invest to be able to then set us up for the long term.

So again, the timing may shift, but the overall how we're building the ecosystem of PayPal, being able to have multiple levers of growth for overall transaction margin and EPS growth over time, I think that's consistent. I think the timing and how we invest to win in the short term will be impacted.

Brian Keene, Head of U.S. Research Practice, Citi: So you're going to be surprised, but agentic's the next question.

Alex Chriss, CEO, PayPal: Shocking.

Brian Keene, Head of U.S. Research Practice, Citi: Can you talk a little bit about what you guys are doing at agentic? And you're obviously excited about it. Why is PayPal different versus the other competitors? And I think it has to do with being a two-sided network. But maybe you can help folks understand as agentic takes off in '26, '27, and beyond, why is PayPal better off maybe than some other competitors?

Alex Chriss, CEO, PayPal: Consumers will have a tolerance for hallucinations when they get to commentary back from their LLM. They will have zero tolerance for hallucinations when it comes to their money and when it comes to purchases. And the reason PayPal is perfectly set up is because we are built on trust across both consumers and merchants to provide that agentic commerce experience that you can believe in and that will be consistent and trustworthy. So what does that look like? So we bring a merchant ecosystem that we have already onboarded, that we've KYBed, that we now have released a commerce protocol to allow them to bring their catalog and actually connect to our orchestration layer that connects to every LLM that's out there.

So we already have announced deals with Google, with OpenAI, and with Perplexity as examples where our merchant ecosystem can actually connect to PayPal once and have their catalog available in a KYB-trusted environment across all of those LLMs for discovery. On the consumer side, we bring not only hundreds of millions of consumers that we've KYC'd through PayPal and Venmo, but also our PayPal World ecosystem. So we now bring 2 billion-plus consumers across PayPal World into this consumer ecosystem where we're able to provide, because we have both sides of the ecosystem, we're able to provide buyer protection for those consumers. When we talk to these LLMs, again, they are incredibly excited about what the future of agentic commerce can be. But we also know fraud is going to be so easy to be able to have fake catalogs and fake merchants just proliferate through these LLMs.

That doesn't happen with PayPal. So one of the reasons you've seen us as first to market with wallets and integrations with Google and OpenAI and Perplexity is because they know that PayPal brings a trusted two-sided ecosystem to bear and enables the confidence of a consumer and a merchant to actually move into this next wave. So I really look at this as in the dawn of e-commerce, PayPal was at the forefront and built a trusted relationship. This is the dawn of agentic commerce, and we're going to leverage the 25 years of brand equity and the millions of consumers and merchants that we can bring to the table and lead agentic commerce going forward. So we're incredibly excited about this shift, and it's a big opportunity for us to win this market.

Brian Keene, Head of U.S. Research Practice, Citi: And how do you see the volume of agentic commerce? Is there an inflection point that you see on the horizon? And then maybe a little bit about the revenue model, any changes that you guys would see in how you guys generate the revenue?

Alex Chriss, CEO, PayPal: So on the revenue model, these are branded checkout transactions for us. So we have relationships with the merchants. A consumer makes a purchase, a PayPal purchase, and vaults PayPal as their agentic commerce wallet, where we're providing them buyer protection and everything else that we do, that's a branded checkout transaction. So no change to the revenue, just upside opportunity for us to take share. In terms of scale, I have no idea. I wish I could look into a crystal ball and tell you how fast commerce is going to move into agentic. But we're going to follow where consumers are. For me, I think the experience for many purchases is superior. When you actually use an agentic experience, you get right to the right product at the right time, and it can create a really personalized experience. But it's all going to come down to trust.

People aren't going to make purchases until they feel like they know and they can trust that when they're allowing their agent to make a purchase on their behalf, that the purchase is actually going to show up and that it's going to be the right product, and that if they have a challenge, they can do a dispute resolution or they can do a return. And all of that, they can track through their PayPal app. And so we think we actually have the opportunity to lean in, be that first wallet to be vaulted in their experience, and create that trusted relationship.

Brian Keene, Head of U.S. Research Practice, Citi: Okay, we're almost out of time. So just to wrap, thinking about the analyst day, and obviously, there's a lot of changes here. So I think you talked about transaction margin dollar acceleration in fiscal year '26, and then you talked about a low teens EPS growth in '27 and high single-digit growth in transaction margin dollars. And then long term, we're talking about transaction margin dollar growth of 10% and long term of 20% EPS growth. Do all those things still hold in everything we talked about today, and how do we think about the medium to long term for PayPal?

Alex Chriss, CEO, PayPal: Yeah. So if I go back and reiterate what I said earlier, what I'm proud of is we now have the levers to control what we want to control. So if we wanted to lean in in '26 and deliver what we talked about, that's our choice. I would not expect that. I would expect that as we've talked about, we're going to lean in and invest our dollars to win what we see to be very critical generational shifts right now. Agentic commerce, buy now, pay later. We think we've got best-in-class products, and we want to be the winner in these spaces as they grow. So expect us to actually invest. And that comes at a headwind of transaction margin dollar growth in '26, but we will invest in order to win these markets over the next year. So that's a choice that we have.

It sets us up for the long term. And again, we're building this company for the next 3, 5, 10 years, and we'll make the right choices as these shifts come upon us to be able to set the company up.

Brian Keene, Head of U.S. Research Practice, Citi: Well, I think personally, I think that's the right thing to do. So excited to see that. Alex, thanks so much for doing this.

Alex Chriss, CEO, PayPal: Great to be here.

Thanks so much. Appreciate it.

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