Jim Cramer set out to find out what is happening in a recent interview of Dan Schulman, president and CEO of PayPal on the "Mad Money" TV show.
PayPal has seen its shares plunge from highs near $310 a share in August to lows below $190 recently.
Schulman first gave Cramer an update on the start of the holiday shopping season. He said digital sales were flat this year, after rising by 50% last year. Retail sales, however, have fallen 26% from their pre-pandemic levels in 2019. These trends indicate that online shopping is here to stay.
PayPal was among the companies identified by Real Money's Eric Jhonsa recently as retaining good prospects in spite of tech weakness. "Growth drivers, such as e-commerce/digital payments adoption, remote learning adoption and the migration of video ad dollars to online channels, leave these companies well-positioned to continue posting healthy double-digit growth over the next several years," Jhonsa wrote.
PayPal forecast 55 million net-new active users this year and Schulman said it remains on target to deliver that number. The company also is expected to meet the target of 750 million total users by 2025.
When asked about involvement in the popular buy-now, pay-later space, Schulman said that while PayPal doesn't get a lot of the hype, it is one of the top four players in the world. Buy-now, pay-later sales were up 400% year-over-year on Black Friday.
Schulman also commented on speculation that PayPal was in talks to acquire Pinterest (PINS) - Get Pinterest, Inc. Class A Report. He said that PayPal looks at hundreds of potential acquisitions every year and has spoken to many many companies. PayPal doesn't need an acquisition to meet guidance, he added.
Finally, when asked about competition like Shopify (SHOP) - Get Shopify, Inc. Class A Report and Square (SQ) - Get Square, Inc. Class A Report, Schulman noted that one out of every four transactions on Shopify is powered by PayPal, so as e-commerce grows, so too does PayPal. There have been a large number of startups in the Fintech sector over the past year. The worldwide drop in stock prices of Fintech companies over the past month has been reported in various financial media.