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NEW YORK (
TheStreet) -- If there was any doubt about the burgeoning growth that the mobile payments business is seeing,
PayPal proved the doubters wrong.
EBay's(EBAY - Get Report)third-quarter earnings were largely aided by explosive growth at PayPal, where revenue increased 23% year over year. Total payment volume rose 20% over the same period to reach $35.2 billion.
It's abundantly clear that mobile payments are seeing explosive growth, and PayPal is at the forefront.
The Digital Wallet's Future Is Now
Barclays Capital analyst Anthony DiClemente noted that eBay (partly through PayPal) continues to see strong growth in mobile and point-of-sale systems, as it approaches $10 billion in mobile payment volume this year. DiClemente rated eBay shares equal-weight but raised his price target from $44 to $49 following the results.
recently signed a deal with
Discover Financial Services(DFS - Get Report) to bring PayPal access to the 7 million merchants across the country which take Discover, starting in the second quarter of 2013. PayPal already has a deal with
Home Depot(HD - Get Report).
For the entire third quarter, eBay earned 55 cents a share on a non-GAAP basis on $3.4 billion in revenue. Analysts polled by
Thomson Reuters expected the online auction services company to generate 54 cents a share on $3.4 billion in revenue.
The online auction services company also provided a fourth-quarter outlook and guidance for the rest of 2012. The company expects non-GAAP earnings between 66 and 69 cents a share on $3.85 billion to $4 billion in sales. GAAP earnings are expected to be between 55 cents and 58 cents a share. Analysts expect earnings of 68 cents a share on $3.94 billion in revenue.
For the full year, eBay expects full-year revenue between $13.95 billion and $14.1 billion, with non-GAAP earnings between $2.32 and $2.35 a share. Analysts forecast earnings of $2.34 a share on $14.02 billion in revenue.