PayPal CEO Wanted: Must Be Able To Reverse $293 Billion Stock Price Plunge

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Wanted: A CEO to manage one of the world’s best-known digital payment platforms. Crucial Attributes: Must enjoy a challenge. Previous experience reversing a $293 billion stock price crash is a plus.

The company in question is PayPal The US has been looking for a new boss since February, when current Dan Schulman announced he would step down at the end of this year.

The vacancy at the top comes at a delicate time. Like Netflix and Peloton, the company was a winner from the coronavirus pandemic that has suffered a huge and painful setback in its fortunes. At its peak in 2021, it boasted a market capitalization of $362 billion and was larger than Goldman Sachs and Morgan Stanley combined. These days it’s worth less than a fifth of that.

Whoever succeeds Schulman will have the unenviable task of injecting new impetus into a business that once dominated the pay on line landscape.

PayPal’s growth has slowed dramatically. Total active accounts decreased by 2 million to 433 million during the first quarter compared to the previous quarter. The company abandoned the goal of reaching 750 million users by 2025 earlier this year.

Payment volumes and revenue were higher compared to last year. But the gains were driven by its Braintree unit, which provides unbranded payments technology to merchants. The division’s payment volume increased 30 percent compared to 6.5 percent at its branded legacy payment business and 9 percent at Venmo.

The bad news is that the unbranded business is much less lucrative than the branded business. The latter faces stiff competition from companies like Apple, Google, Affirm and Afterpay. Operating margin fell quarter over quarter to 14.2%.

The cost cutting and higher fees that helped PayPal grow bottom line cannot be repeated indefinitely. The shares are trading at just 13 times future earnings, compared with 31 times for Block, owner of Square, and its own three-year average of about 36 times. That tells potential CEOs how tough the job is going to be.