PayPal Holdings, Inc. (PYPL) has reported a 6.27 percent rise in profit for the quarter ended Dec. 31, 2016. The company has earned $390 million, or $0.32 a share in the quarter, compared with $367 million, or $0.30 a share for the same period last year. On the other hand, adjusted net income for the quarter stood at $512 million, or $0.42 a share compared with $443 million or $0.36 a share, a year ago.
Revenue during the quarter grew 16.63 percent to $2,981 million from $2,556 million in the previous year period. Total expenses were 84.57 percent of quarterly revenues, up from 83.92 percent for the same period last year. That has resulted in a contraction of 65 basis points in operating margin to 15.43 percent.
Operating income for the quarter was $460 million, compared with $411 million in the previous year period.
However, the adjusted operating income for the quarter stood at $619 million compared to $532 million in the prior year period.
"I'm pleased to report that PayPal ended 2016 with another strong quarter of financial results. We extended our industry leadership by generating 18 million active customer accounts, with greater engagement than ever before. We innovated across our merchant and consumer value propositions and extended our lead in mobile payments," said Dan Schulman, president and chief executive officer of PayPal. "In the past year, we transformed our market opportunity with a series of strategic partnerships with networks, financial institutions, technology companies, and mobile carriers. We accomplished all of this by putting our customers first, in everything we do. At the end of a landmark year for PayPal, we feel well positioned to deliver sustainable and profitable growth in 2017 and beyond."
For financial year 2017, PayPal Holdings, Inc. projects revenue to be in the range of $12,450 million to $12,650 million. The company forecasts diluted earnings per share to be in the range of $1.26 to $1.31 and forecasts diluted earnings per share to be in the range of $1.69 to $1.74 on adjusted basis.
For the first-quarter 2017, PayPal Holdings, Inc. projects revenue to be in the range of $2,900 million to $2,950 million. The company forecasts diluted earnings per share to be in the range of $0.31 to $0.33. On an adjusted basis, the company forecasts diluted earnings per share to be in the range of $0.40 to $0.42.
Operating cash flow improves
PayPal Holdings, Inc. has generated cash of $3,158 million from operating activities during the year, up 24.04 percent or $612 million, when compared with the last year. The company has spent $4,999 million cash to meet investing activities during the year as against cash outgo of $8,038 million in the last year.
Cash flow from financing activities was $2,038 million for the year, down 56.90 percent or $2,690 million, when compared with the last year.
Cash and cash equivalents stood at $1,590 million as on Dec. 31, 2016, up 14.14 percent or $197 million from $1,393 million on Dec. 31, 2015.
Working capital increases sharply
PayPal Holdings, Inc. has recorded an increase in the working capital over the last year. It stood at $8,855 million as at Dec. 31, 2016, up 25.94 percent or $1,824 million from $7,031 million on Dec. 31, 2015. Current ratio was at 1.52 as on Dec. 31, 2016, up from 1.52 on Dec. 31, 2015.
Days sales outstanding went up to 307 days for the quarter compared with 298 days for the same period last year.
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