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PayPal shares fall as sales outlook misses Wall St expectations

PayPal shares fall as sales outlook misses Wall St expectations
FILE PHOTO: The PayPal app logo seen on a mobile phone in this illustration photo October 16, 2017. REUTERS/Thomas White/Illustration   -   Copyright  THOMAS WHITE(Reuters)
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By Anna Irrera

NEWYORK (Reuters) – PayPal Holdings Inc shares fell almost 4 percent in after-hours trading on Wednesday after the online payments company forecast revenue for the current quarter short of Wall Street’s expectations.

For the fourth quarter that ended in December, revenue rose to $4.23 billion (£3.24 billion) from $3.74 billion, just missing analysts’ average estimate of $4.24 billion, according to IBES data from Refinitiv.

For the first quarter, PayPal said it expects revenue between $4.08 billion and $4.13 billion, falling short of analysts’ average $4.16 billion estimate. The company reaffirmed its full year outlook.

Excluding one-time items, the digital payments company earned 69 cents per share, beating the average analyst estimate of 67 cents.

Net income fell to $584 million, or 49 cents per share, in the fourth quarter, from $620 million, or 50 cents per share, a year earlier.

Shares of the San Jose, California based company were down 3.85 percent at $88.86 after the bell on Wednesday.

PayPal separated from ecommerce platform eBay Inc in 2015 and has since focused on broadening the types of services it offers to consumers and merchants, making a slew of acquisitions and partnerships.

The company added a record 13.8 million new active accounts in the fourth quarter, compared to an increase of 8.7 million a year earlier. Around 2.9 million of those accounts were added through acquisitions.

PayPal processed $164 billion in payments over the period, up 23 percent from a year earlier.

Venmo, its peer-to-peer payment app popular with younger consumers, processed $19 billion of payments in the fourth quarter, up 80 percent from the same quarter a year ago.

(Reporting by Anna Irrera; Editing by David Gregorio)

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