Analysis of Debt
Total Debt (Carrying Amount)
PayPal Holdings Inc., balance sheet: debt
US$ in millions
Based on: 10-K (reporting date: 2022-12-31), 10-K (reporting date: 2021-12-31), 10-K (reporting date: 2020-12-31), 10-K (reporting date: 2019-12-31), 10-K (reporting date: 2018-12-31).
The total debt (carrying amount) exhibits a consistent and significant upward trajectory from 2018 through 2022, indicating a substantial expansion of the organization's leveraged position over the five-year period.
- Total Debt Trajectory
- Total debt increased from 1,998 million USD in 2018 to 10,835 million USD by December 31, 2022. The most aggressive growth occurred between 2019 and 2020, where the total carrying amount rose from 4,965 million USD to 8,939 million USD, representing an increase of approximately 80% within a single fiscal year.
- Debt Composition and Shift
- A fundamental shift in the debt structure is evident. In 2018, the debt profile consisted entirely of short-term debt totaling 1,998 million USD. From 2019 onward, the composition shifted almost exclusively to long-term obligations. Long-term debt, excluding the current portion, grew from 4,965 million USD in 2019 to a peak of 10,417 million USD in 2022.
- Current Obligations and Maturity Patterns
- The introduction of a current portion of long-term debt in 2021 at 999 million USD, followed by a decrease to 418 million USD in 2022, indicates the commencement of repayment cycles for previously issued long-term instruments. Despite a period of relative stability in 2021, where total debt only marginally increased to 9,048 million USD, a renewed upward trend emerged in 2022, driven by the increase in long-term debt.
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Total Debt (Fair Value)
| Dec 31, 2022 | |
|---|---|
| Selected Financial Data (US$ in millions) | |
| Short-term debt | —) |
| Fixed-rate notes | 9,500) |
| Credit facilities | 491) |
| Total debt (fair value) | 9,991) |
| Financial Ratio | |
| Debt, fair value to carrying amount ratio | 0.92 |
Based on: 10-K (reporting date: 2022-12-31).
Weighted-average Interest Rate on Debt
Weighted-average effective interest rate on fixed-rate notes: 3.22%
| Interest rate | Debt amount1 | Interest rate × Debt amount | Weighted-average interest rate2 |
|---|---|---|---|
| 2.52% | 1,250) | 32) | |
| 2.78% | 1,250) | 35) | |
| 2.96% | 1,500) | 44) | |
| 1.55% | 418) | 6) | |
| 1.78% | 1,000) | 18) | |
| 2.39% | 1,000) | 24) | |
| 3.33% | 1,000) | 33) | |
| 4.06% | 500) | 20) | |
| 4.53% | 1,000) | 45) | |
| 5.14% | 1,000) | 51) | |
| 5.34% | 500) | 27) | |
| Total | 10,418) | 336) | |
| 3.22% | |||
Based on: 10-K (reporting date: 2022-12-31).
1 US$ in millions
2 Weighted-average interest rate = 100 × 336 ÷ 10,418 = 3.22%