PayPal's 2026 Outlook Falls Dramatically Short of Prior Expectations; Investigation Examines Gap Between Company Statements and Results

NASDAQ: PYPL

NEW YORK, Feb. 4, 2026 /PRNewswire/ -- Levi & Korsinsky, LLP is investigating PayPal Holdings, Inc. (NASDAQ: PYPL) concerning potential securities claims related to the significant gap between the company's prior outlook and its actual fourth quarter 2025 results. Those who purchased shares and incurred losses may click here to obtain additional information.

The timeline of analyst expectations and company communications reveals a notable trajectory. On January 28, 2026, Rothschild & Co Redburn issued a downgrade, cutting PayPal's price target to $50 from $70. The following day, Morgan Stanley also reduced its target to $50, citing slower checkout growth. On February 2, just one day before earnings, analysts published expectations for mid-single-digit revenue growth and higher earnings per share.

The actual results disclosed on February 3 represented a meaningful miss versus these expectations. Revenue of $8.68 billion fell $120 million short of the $8.80 billion estimate, a gap of approximately 1.4%. Adjusted earnings of $1.23 per share missed the consensus range of $1.30 to $1.33 by 5.4% to 7.5%. Perhaps more significantly, the company's forward guidance projected 2026 transaction margin dollars to decline alongside an adjusted earnings per share range of a low single digit decline to a slightly positive gain, figures that were substantially below what the investment community had been modeling.

During the company's third quarter 2025 earnings call on October 28, 2025, approximately 98 days before the latest disclosure, management had not indicated that such a dramatic revision to the company's outlook would be forthcoming. The investigation will examine what information was available to management during this period and when the factors necessitating the lowered guidance became apparent internally.

PayPal shares dropped 19-20% on February 3, falling to approximately $42 and establishing a new 52-week low. Short interest reportedly increased sharply as traders anticipated further declines.

Investors who lost money on PayPal securities are encouraged to contact the firm to discuss their legal options.

Levi & Korsinsky, LLP is a nationally recognized firm with offices in New York, California, Connecticut, and Washington, D.C. that prosecutes securities, consumer, and shareholder class actions on behalf of investors (www.zlk.com).

CONTACT:
Joseph E. Levi, Esq.
Levi & Korsinsky, LLP
33 Whitehall Street, 27th Floor
New York, NY 10004
Tel: (212) 363-7500
Fax: (212) 363-7171
Email: [email protected]
www.zlk.com

SOURCE Levi & Korsinsky, LLP