PayPal’s PYPL stock has fallen nearly 6% to around $45 after reports confirmed the company is not in active talks with Stripe. Investors had speculated about a possible strategic deal that could strengthen PayPal’s competitive position in digital payments. The report cooled those expectations and shifted focus back to the company’s fundamentals and forward guidance. At the same time, PayPal’s cautious 2026 outlook and slowing branded checkout growth added pressure to the stock. The combination of fading takeover optimism and softer growth projections weighed on investor sentiment during the session. Stripe Report Ends Speculation Recent reporting indicated that PayPal is not actively seeking a buyer and is not negotiating with Stripe or other companies. While earlier speculation suggested Stripe had explored a potential acquisition, no formal discussions are currently underway. According to Semafor, PayPal has instead been preparing defensive measures against potential activist investors or hostile takeover attempts. This move followed a sharp decline in its stock price, which increased concerns about vulnerability. Investors had viewed a possible Stripe partnership or acquisition as a way to unlock growth and strengthen PayPal’s infrastructure. However, large transactions between private buyers and public companies are complex, especially since Stripe would need significant debt financing to complete a deal. Q4 Results Show Steady but Modest Growth Concurrently, PayPal has recently reported fourth-quarter revenue of $8.68 billion, representing a 3.7% increase year over year. Per the report, adjusted earnings per share reached $1.23, reflecting a 3.4% annual increase, while non-GAAP operating income rose 3%. Total payment volume climbed 8.8% to $475.14 billion, and transaction margin dollars increased 2.5% to $4.03 billion. In addition the active accounts grew 1.2% to 439 million, showing continued expansion of the user base. Despite these gains, management issued cautious guidance for 2026. The company expects transaction margin dollars to decline slightly and adjusted earnings per share to range from a low single-digit decline to a slight increase. Although PayPal projects over $6 billion in adjusted free cash flow and plans $6 billion in share repurchases, investors questioned whether growth drivers remain strong enough. Slower Checkout Growth Raises Concerns Branded checkout total payment volume grew just 1% on a currency-neutral basis, down from 5% in the prior quarter. Management cited U.S. retail weakness, macro softness in Germany, and slower activity in travel, crypto, and gaming sectors. Payment transactions per active account declined 4.8% on a trailing 12 month basis, signaling softer engagement levels. However, the management acknowledged that execution speed and operational focus did not meet internal expectations. PayPal operates in a highly competitive global payments market and faces pressure from both established players and emerging fintech firms. Currency fluctuations and shifting consumer spending patterns also add complexity to its performance outlook. The drop in PYPL stock reflects fading acquisition speculation and investor concerns about growth momentum heading into 2026. Moreover, as we reported , heading into March, PayPal will see a leadership transition with Enrique Lores assuming the role of president and chief executive on March 1, replacing Alex Chriss.
