PYPL · Forward model · Revenues from other value added services · Bull case
What has to happen in Revenues from other value added services
Model as of
This page changes Revenues from other value added services inside the complete PYPL model. Every other vertical, corporate programme and valuation assumption stays in the selected portfolio case.
Shares this vertical and portfolio case. Slider and horizon edits stay in your browser.
Revenues from other value added services
The other ten per cent, and the part that is not a payments business: partnership and referral fees, subscription and gateway fees, interest and fees on the loan book, and interest earned on the assets underlying customer balances. That last component alone was $281M of the $850M basis quarter and carries essentially no volume cost, which is why PayPal now reports transaction margin dollars both with and without it. It has turned from tailwind to headwind - the line grew 15-17% year over year through 2025 and grew 0.4% in the basis quarter, entirely because interest on balances fell from $318M to $281M while the rest grew about 8%. No operational unit exists to drive it, so it runs on a sequential growth rate.
Latest: $1.06B (2031Q2E)
| Period | Value |
|---|---|
| 2021Q2 | $441M |
| 2021Q3 | $575M |
| 2021Q4 | $541M |
| 2022Q1 | $485M |
| 2022Q2 | $534M |
| 2022Q3 | $612M |
| 2022Q4 | $681M |
| 2023Q1 | $676M |
| 2023Q2 | $731M |
| 2023Q3 | $764M |
| 2023Q4 | $743M |
| 2024Q1 | $665M |
| 2024Q2 | $732M |
| 2024Q3 | $780M |
| 2024Q4 | $778M |
| 2025Q1 | $775M |
| 2025Q2 | $847M |
| 2025Q3 | $895M |
| 2025Q4 | $857M |
| 2026Q1 | $852M |
| 2026Q2 | $850M |
| 2026Q3E | $858M |
| 2026Q4E | $866M |
| 2027Q1E | $875M |
| 2027Q2E | $884M |
| 2027Q3E | $893M |
| 2027Q4E | $903M |
| 2028Q1E | $912M |
| 2028Q2E | $922M |
| 2028Q3E | $933M |
| 2028Q4E | $943M |
| 2029Q1E | $954M |
| 2029Q2E | $965M |
| 2029Q3E | $976M |
| 2029Q4E | $987M |
| 2030Q1E | $999M |
| 2030Q2E | $1.01B |
| 2030Q3E | $1.02B |
| 2030Q4E | $1.04B |
| 2031Q1E | $1.05B |
| 2031Q2E | $1.06B |
Assumptions & reasoning
- This line is left ASEASONAL on evidence, not for want of looking. The same centred-moving-average method run over the same 21 quarters gives factors whose within-quarter spread reaches 0.073 against a largest mean deviation of 0.061, and the two windows disagree by 0.015 in Q4 - ten times the disagreement on the transaction line. A shape fitted across a period when the interest component swung from tailwind to headwind is fitting a rate cycle and calling it a season.
- Interest on customer balances was $281M of the $850M basis quarter, derived as transaction margin dollars $3,900M less the $3,619M reported ex-interest. It is a rates position with no operational driver in PayPal's disclosure, so it is left inside this line's growth rate rather than modelled as a separate rate path.
- The 91.3% margin is $850M less the $74M credit loss the deck reports separately, and is ASSUMED. Interest on balances carries no volume cost at all, which is what puts the margin this high; the terminal 88% assumes credit and BNPL grow faster than the fee lines and pull allocated credit loss up.
- $589M of basis-quarter revenue sits outside ASC 606 - interest and fees on loans, hedging gains and losses, and interest and gains on assets underlying customer balances - and most of it is in this line. PayPal also originated $12.5B of loans receivable held for sale in the quarter and sells them on, which is what adjusted free cash flow exists to strip out.