Net Profit Margin
since 2015
Calculation
PayPal Holdings Inc., net profit margin, long-term trends, calculation
| Net profit margin | = | 100 | × | Net income1 | ÷ | Net revenues1 | |
|---|---|---|---|---|---|---|---|
| Dec 31, 2022 | 8.79% | = | 100 | × | 2,419) | ÷ | 27,518) |
| Dec 31, 2021 | 16.43% | = | 100 | × | 4,169) | ÷ | 25,371) |
| Dec 31, 2020 | 19.59% | = | 100 | × | 4,202) | ÷ | 21,454) |
| Dec 31, 2019 | 13.84% | = | 100 | × | 2,459) | ÷ | 17,772) |
| Dec 31, 2018 | 13.31% | = | 100 | × | 2,057) | ÷ | 15,451) |
| Dec 31, 2017 | 13.71% | = | 100 | × | 1,795) | ÷ | 13,094) |
| Dec 31, 2016 | 12.92% | = | 100 | × | 1,401) | ÷ | 10,842) |
| Dec 31, 2015 | 13.28% | = | 100 | × | 1,228) | ÷ | 9,248) |
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), 10-K (reporting date: 2017-12-31), 10-K (reporting date: 2016-12-31), 10-K (reporting date: 2015-12-31).
1 US$ in millions
Between 2015 and 2022, net revenues exhibited a consistent and uninterrupted upward trajectory, increasing from US$ 9,248 million to US$ 27,518 million. In contrast, net income and the corresponding net profit margin showed greater volatility, characterized by a phase of stability, a significant peak, and a subsequent sharp contraction.
- Revenue and Net Income Correlation
- Net revenues grew steadily each year throughout the analyzed period. Net income generally tracked this growth from 2015 through 2020, reaching a peak of US$ 4,202 million. However, a divergence emerged after 2020; while revenues continued to rise, net income declined to US$ 2,419 million by 2022, indicating a decoupling of top-line growth from bottom-line profitability.
- Net Profit Margin Stability and Peak
- From 2015 to 2019, the net profit margin remained relatively stagnant, fluctuating within a narrow range between 12.92% and 13.84%. A substantial expansion occurred in 2020, where the margin spiked to 19.59%, the highest point in the recorded period, reflecting a temporary increase in operational efficiency or a shift in revenue composition.
- Analysis of Margin Erosion
- Following the 2020 peak, a pronounced downward trend is observed. The net profit margin fell to 16.43% in 2021 and further collapsed to 8.79% by December 31, 2022. This final value represents the lowest margin in the eight-year sequence, suggesting that operating expenses or other costs escalated significantly relative to revenue growth during the most recent fiscal year.
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Comparison to Competitors
PayPal Holdings Inc., net profit margin, long-term trends, comparison to competitors
| PayPal Holdings Inc. | Accenture PLC | Adobe Inc. | AppLovin Corp. | Cadence Design Systems Inc. | Datadog Inc. | International Business Machines Corp. | Intuit Inc. | Microsoft Corp. | Oracle Corp. | Palantir Technologies Inc. | Palo Alto Networks Inc. | Salesforce Inc. | ServiceNow Inc. | Synopsys Inc. | Workday Inc. | |
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Dec 31, 2022 | 8.79% | 11.17% | 27.01% | -6.84% | 23.84% | -2.99% | 2.71% | 16.23% | 36.69% | 15.83% | -19.61% | -4.85% | 5.45% | 4.49% | 19.38% | 0.57% |
| Dec 31, 2021 | 16.43% | 11.69% | 30.55% | 1.27% | 23.29% | -2.02% | 10.01% | 21.41% | 36.45% | 33.96% | -33.75% | -11.72% | 19.16% | 3.90% | 18.02% | -6.54% |
| Dec 31, 2020 | 19.59% | 11.52% | 40.88% | — | 22.02% | -4.07% | 7.59% | 23.78% | 30.96% | 25.94% | -106.75% | -7.83% | 0.74% | 2.62% | 18.03% | -13.25% |
| Dec 31, 2019 | 13.84% | 11.06% | 26.42% | — | 42.33% | -4.61% | 12.22% | 22.95% | 31.18% | 28.05% | — | -2.82% | 8.36% | 18.11% | 15.84% | -14.82% |
| Dec 31, 2018 | 13.31% | 9.76% | 28.69% | — | 16.17% | — | 10.97% | 20.31% | 15.02% | 9.60% | — | -6.51% | 1.22% | -1.02% | 13.86% | -14.99% |
| Dec 31, 2017 | 13.71% | 9.37% | 23.20% | — | 10.50% | — | 7.27% | 18.76% | 23.57% | 24.74% | — | -12.30% | 2.14% | -7.71% | 5.01% | -26.01% |
| Dec 31, 2016 | 12.92% | 11.82% | 19.96% | — | 11.18% | — | 14.86% | 20.86% | 19.69% | 24.03% | — | -16.39% | -0.71% | -32.49% | 11.01% | -24.94% |
| Dec 31, 2015 | 13.28% | 9.28% | 13.13% | — | 14.83% | — | 16.14% | 8.71% | 13.03% | 26.00% | — | -17.78% | -4.89% | -19.73% | 10.08% | -31.48% |
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), 10-K (reporting date: 2017-12-31), 10-K (reporting date: 2016-12-31), 10-K (reporting date: 2015-12-31).
Comparison to Sector (Software & Services)
PayPal Holdings Inc., net profit margin, long-term trends, comparison to sector (software & services)
| PayPal Holdings Inc. | Software & Services | |
|---|---|---|
| Dec 31, 2022 | 8.79% | 21.55% |
| Dec 31, 2021 | 16.43% | 25.12% |
| Dec 31, 2020 | 19.59% | 20.08% |
| Dec 31, 2019 | 13.84% | 21.61% |
| Dec 31, 2018 | 13.31% | 12.10% |
| Dec 31, 2017 | 13.71% | 15.36% |
| Dec 31, 2016 | 12.92% | 16.49% |
| Dec 31, 2015 | 13.28% | 14.57% |
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), 10-K (reporting date: 2017-12-31), 10-K (reporting date: 2016-12-31), 10-K (reporting date: 2015-12-31).
Comparison to Industry (Information Technology)
PayPal Holdings Inc., net profit margin, long-term trends, comparison to industry (information technology)
| PayPal Holdings Inc. | Information Technology | |
|---|---|---|
| Dec 31, 2022 | 8.79% | 22.27% |
| Dec 31, 2021 | 16.43% | 23.48% |
| Dec 31, 2020 | 19.59% | 19.76% |
| Dec 31, 2019 | 13.84% | 19.73% |
| Dec 31, 2018 | 13.31% | 18.59% |
| Dec 31, 2017 | 13.71% | 17.77% |
| Dec 31, 2016 | 12.92% | 17.58% |
| Dec 31, 2015 | 13.28% | 18.32% |
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), 10-K (reporting date: 2017-12-31), 10-K (reporting date: 2016-12-31), 10-K (reporting date: 2015-12-31).