Electronic payments giant PayPal (PYPL) reported better-than-expected third-quarter earnings late Thursday, debunking claims it can't keep up with the competition.

Sure, there's Apple (AAPL) and Square (SQ)  making inroads into the payments space, but PayPal's revenue and profit margin continue to climb. The company even raised its three-year revenue growth forecast to a range of 16% to 17%, from its previous guidance of 15%.

For the quarter that ended September, PayPal reported adjusted earnings per share of 35 cents on an 18% jump in revenue of $2.67 billion, which topped Wall Street's estimates of $2.65 billion, according to Thomson Reuters. Notably, PayPal's active customer accounts grew 11% year to year to 192 million, while the number of processed transactions jumped 24% to 1.5 billion.

There had been concerns PayPal's profit margin would be under pressure from higher expenses, driven by the partnerships the company signed earlier in the year with Visa (V) and MasterCard (MA) . The deals that allowed PayPal to transact in-store payments was expected to result in higher transaction expenses for the company.

On Thursday, however, PayPal said it expects adjusted operating margin to be stable or higher in the next three years. PYPL trades around $40, up 10.8% year to date, outperforming the 4.8% rise in the S&P 500 (SPX) .

After being spun off last year from eBay (EBAY) , PayPal is growing rapidly thanks to such payment assets as person-to-person payment app Venmo, whose third quarter revenue surged 131% following a 141% rise is the second quarter.

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