11:10 AM EDT, 10/29/2024 (MT Newswires) -- PayPal's ( PYPL ) third-quarter revenue grew less than expected while earnings growth outpaced analysts' views as the digital payments company improved its full-year bottom-line expectations.

Revenue rose to $7.85 billion for the three-month period ended Sept. 30 from $7.42 billion the year earlier but was shy of the $7.89 billion average analyst estimate on Capital IQ. Adjusted earnings per share advanced to $1.20 from $0.98 and beat the $1.07 consensus.

Shares of PayPal ( PYPL ) fell 6% in Tuesday trade.

"We're early in our transformation journey, and we have a lot of work ahead to get to where we want to be," Chief Executive Alex Chriss told analysts on a conference call, according to a Capital IQ transcript. "However, I'm proud of what we've been able to achieve in the last year, and it gives me conviction that we're taking the necessary steps to unlock the full potential of PayPal ( PYPL ) and Venmo over time."

Venmo is a payment app.

Total payment volume climbed 9% to $422.64 billion but decelerated from a 15% pace reported for the September 2023 quarter. Transaction margin dollars increased 8% to $3.65 billion.

For the fourth quarter, the payments processor is forecasting a low- to mid-single-digit decrease in adjusted EPS from the $1.14 PayPal ( PYPL ) reported in the same quarter of 2023. The guidance reflects increased marketing investments to support certain initiatives and new products, it said. Analysts are modeling for normalized EPS of $1.11 in the current quarter.

PayPal ( PYPL ) is guiding for low single-digit revenue growth in the fourth quarter from $8.03 billion the year earlier. Analysts are expecting revenue of $8.39 billion.

For the full year, the company now expects adjusted EPS growth in the high teens percentage range from 2023's $3.83 tally. That's compared with PayPal's ( PYPL ) July guidance for low- to mid-teens growth. The Street is forecasting normalized EPS of $4.44 this year.

The company raised its guidance for full-year transaction margin dollars, which is now expected to increase by a mid-single-digit percentage, Chief Financial Officer Jamie Miller told analysts on the call.

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