PayPal Holdings, Inc.

I'm joined by CEO Alex Criss and CFO Jamie Miller. Our remarks today include forward-looking statements that involve risks and uncertainties. Actual results may differ materially from these statements. Our commentary is based on our best view of the world and our businesses as we see them today. As described in our earnings press release, SEC filings, and on our website, those elements may change as the world changes. Now over to you, Alex.

Thanks, Steve. And thank you to everyone for joining us this morning. PayPal had a successful 2024, delivering strong operating and financial results. The improvements we've made to branded checkout, P2P, and Venmo, plus the progress we've made on our price-to-value strategy are beginning to show up in our results. We set out at the beginning of 2024 to make it a transition year, to narrow our focus and to make sure we are executing the initiatives that matter the most to the growth of our business. One year later, I'm proud that we've laid a strong foundation for durable growth. We drove branded checkout transaction margin dollar growth in each quarter. U.S. branded checkout growth accelerated in the fourth quarter to exit the year at a high point as our new checkout innovations are scaling to customers. Driven by a renewed focus on pricing to value, Braintree has meaningfully contributed to our transaction margin dollar growth over the last three quarters. Venmo monetization is making great strides with over 20% growth in Venmo debit card and pay with Venmo monthly active accounts. Put simply, the PayPal team executed well during our transition year and made strong progress on our transformation. The investments we made throughout 2024 allowed us to perform well during the holiday shopping season and finish the year strongly. Total active accounts returned to growth in 24 as we enhanced our value proposition and brought innovation to market. Total payment volume grew 10% to nearly $1.7 trillion. We delivered $32 billion in revenue, up 7%. We reached an inflection point for transaction margin dollar growth, which increased 5%, excluding the benefit of interest on customer balances. Our non-GAAP earnings per share increased 21% year over year. We generated $6.8 billion in free cash flow and completed $6 billion in share buybacks. For 2025, we expect another solid year of transaction margin dollar growth and strong free cash flow, which Jamie will discuss. As we look ahead to 2025, I want to share the areas we're most focused on. First is innovation. With the leadership team in place and the velocity with which we're executing, We've proven we can bring innovations to market. In 2024, we rolled out new branded checkout experiences, launched PayPal Everywhere, introduced Fastlane, and expanded PayPal Complete Payments. We are not stopping there and will continue to innovate to solve our customers' biggest challenges. The second is product adoption. 2025 will be focused on scaling adoption of our innovations. We have world-class products and solutions and will continue educating customers about all we have to offer. In 24, we completely revamped our marketing and go-to-market playbook. We're just scratching the surface, so you can expect more ahead. Third is partnerships. Last year, we formed significant partnerships to drive fast lane adoption and bring more value to customers. We are building on our leadership position in payments and commerce and establishing ourselves as the platform that leading brands want to work with. We will strike even more partnerships throughout 2025. Fourth is efficiency and effectiveness. In 2024, we reduced headcount by 10%. We made deliberate investments in AI and automation, which are critical to our future. This year, we are prioritizing the use of AI to improve the customer experience and drive efficiency and effectiveness within PayPal. We expect to make meaningful progress on all four of these areas in 25. Let me walk you through how this focus will drive our results this year and beyond. In 25, our key strategic initiatives will be to win checkout, scale Omni, grow Venmo, and accelerate SMB. Our teams are organized around these priorities and tracking progress daily. Starting with wind checkout, our number one priority. With our upgraded experiences, we now have the leading checkout solution on desktop and mobile. When fully implemented, the upgraded experiences reduce latency by more than 40% and drive more than 100 basis points of conversion list on average. consistent with the early results we've shared. These upgrades are now live for more than 25% of U.S. checkout traffic, which is up from 5% last quarter. We have a lot of room to grow here as adoption increases in the U.S. and then expands globally. On top of the benefit of higher conversion, these new experiences improve the presentment of our branded marks and solutions, like Buy Now, Pay Later, which can help to expand our share of wallets. BNPL customers spend 30% more on average, and merchants see higher sales after adding BNPL messaging to their sites, which is critical when one more sale can make all the difference. In 2024, we drove approximately $33 billion in BNPL total payment volume, growing 21% from the prior year. Consumers and merchants trust the PayPal brand and experience. We have a lot more we can do with BNPL in the next year. Merchants continue to show strong interest in Fastlane. In the fourth quarter, we focused on selling Fastlane to large brands that can drive future volume. I'm excited to share that we have signed NBCUniversal, Roku, and StockX and are working on implementation. We now have nearly 2,000 merchants up and running with Fastlane. We expect an inflection point in adoption when we expand our go-to-market efforts and bring Fastlane to even more merchants through Audion, Global Payments, and Pfizer this year. From early data, what's exciting is that 25% of Fastlane users have never had a PayPal account before, and more than half have a PayPal account but haven't been active in the last 12 months. To say that simply, 75% of Fastlane consumers are new or dormant PayPal users. This means that Fastlane not only improves conversion for our merchants, but also introduces more shoppers to PayPal and enables us to reengage in active users. We share that one of our strategies is to build deeper relationships with our largest merchants as we renegotiate deals to reflect the value we provide. A key part of that is adding value-added services that improve the experience for our mutual customers. We built a suite of world-class value-added services and continue to introduce new ones. In the fourth quarter, we launched FX as a service, which is automated currency conversion, and it's already live for Meta. We also actively scaled the use of network tokens for automated billing capabilities, which is live with merchants, including Instacart, Mint Mobile, and Poshmark. The expansion of our value-added services is a key driver of the transaction margin dollar growth we are delivering. Next, let's talk about our initiative to expand beyond e-commerce to become truly omnichannel. We launched PayPal Everywhere in September, which is driving significant increases in debit card adoption and opening new categories of spend. We added more than 1.5 million first-time PayPal debit card users in the fourth quarter, and debit card TPV was up nearly 100% in Q4. Our most active reward categories are gas, groceries, and restaurants. These new capabilities are driving deeper relationships with our users and more PayPal volume overall, offline and online. The average debit card actives generate five times the transaction activity and two times the average revenue per account compared to users who only use branded checkout. This is leading to habituation. Power users, which are PayPal consumer accounts transacting more than 100 times per year, grew more than 9% year over year in the fourth quarter. So we are seeing strong momentum today with our omnichannel push but we're just getting started. We plan to expand our PayPal Everywhere value proposition to several European markets this year, including launching NFC capabilities in Germany. Moving to our progress to grow Venmo. Our task is twofold. First, continue to improve the social P2P payment experience that made Venmo averse, increasing engagement and bringing on more users. Second, drive adoption of our monetized products, including the Venmo debit card and pay with Venmo. In the fourth quarter, we continued improving the Venmo experience by giving our users more of the capabilities they've been asking for, like scheduled sends and improved search. With these steady improvements to the experience, we see engagement increasing. Our engaged Venmo user base grew 4% in the quarter, reaching more than 64 million monthly active accounts. On monetization, we increased the average revenue per active Venmo account in 2024, and we plan to build on that growth in 2025. Monetized Venmo monthly active accounts beyond P2P and instant transfers grew more than 20% in the fourth quarter, driven by the adoption of Venmo Debit Card and Pay with Venmo. Venmo Debit Card monthly actives grew more than 30%, and Pay with Venmo monthly actives grew more than 20%. We continue to expand Venmo's acceptance with major brands like Instacart and Moonpay, adding Venmo in the fourth quarter. And as we recently announced, JetBlue became the first airline to accept Venmo for flight bookings. So while we are still early in monetizing Venmo, we have a proven playbook that is resonating with customers. This gives us confidence as we move to 2025 and beyond. Finally, I'd like to cover our efforts to accelerate growth for SMBs. We are moving from a disparate set of payment products to building an end-to-end suite of solutions that solves more small business needs. PayPal Complete Payments was the first step towards an integrated suite of solutions, and we continue to make progress driving adoption with 45% of SMB processing and checkout volume now on this platform. Merchants on PPCP benefit from our upgraded branded checkout experiences. Key to our success in growing with small businesses on our platform is our expanding set of connected and value-added services, which move us beyond a payment provider to a growth partner and help us retain customers throughout their business lifecycle. Take, for example, our merchant financing solutions. Entrepreneurs come to us for payment services as they start their business. As their business grows, they need access to capital to buy inventory, invest in marketing, and hire. PayPal Working Capital is a financing solution purpose-built for early-stage companies. As the business matures, PayPal Business Loan offers more traditional merchant financing to match the increasing complexity and multi-channel nature of larger businesses. Our business financing solutions increase loyalty and engagement, driving the PayPal flywheel. Merchants typically increase their PayPal volume by 36% after adopting PayPal working capital and 16% after taking a PayPal business loan. Our merchant lending originations were $3 billion in 24, demonstrating our leadership and that there's plenty of room to grow to support our customers. This is just one example of the services we offer that help SMBs change the trajectory of their businesses. Expanding this ecosystem of value-added services is a focus in 2025 and beyond. To close out, I wanna thank the PayPal team for their focus on delivering for customers every day. I am proud of how far we have come in the last year. It was an important transition year for PayPal. We created strong momentum that sets up well for 2025 and beyond. We are now executing a game plan that we have confidence in, and I'm excited to share more at our investor day later this month. With that, over to Jamie.

Thanks, Alex. Moving to slide seven, PayPal delivered another solid quarter of results to end the year. While there's still more work to be done, the team is making progress building on the firm foundation that we have established. As we enter the second year of the company's transformation, our teams are energized and moving quickly. We remain focused on better serving our customers as we seek to drive durable, profitable growth. Looking at the high-level financial results in the fourth quarter, revenue grew 4% on both a spot and currency-neutral basis. For the full year, revenue grew 7% on both a spot and currency neutral basis. Transaction margin dollars grew 7% in the fourth quarter, or 6% excluding the benefit of interest on customer balances. Outperformance compared to our guidance was driven by higher contribution from branded checkout and Venmo, credit performance, and interest earned on customer balances. For the full year, transaction margin dollars grew 7% or 5%, excluding the benefit of interest on customer balances. Non-GAAP earnings per share were $1.19 in the quarter, up 5%. We ended the full year with $4.65 of non-GAAP earnings per share, up 21%. These full year results benefited from a return to transaction margin dollar growth fueled by our transformation efforts, expense discipline, the higher interest rate environment, and a strong capital return program. Turning to slide eight, our operating metrics reflect another quarter of steady progress. Total active accounts increased by nearly $3 million from the third quarter and nearly $9 million from last year to $434 million. Monthly active accounts also continued to show steady progress. up 2% year-over-year to $229 million with contributions from PayPal consumer accounts and Venmo. Transactions per active account excluding PSP processing grew 4%. Moving to slide 9, total payment volume grew 7% on a spot and currency neutral basis to $438 billion. For the full year, TPV grew to nearly $1.7 trillion, up 10% on a spot and currency neutral basis. Looking at the TPV breakdown by product, we see strength starting to build in some key areas. PayPal P2P accelerated for the sixth consecutive quarter to 6% growth. Venmo also accelerated by two points to 10% growth. Steady incremental product improvements combined with reinvigorated marketing campaigns are starting to make an impact. Global branded checkout volumes increased 6% on a currency neutral basis in the fourth quarter. This was about a 50 basis point acceleration from the prior quarter. Underlying this growth, we were encouraged to see U.S. branded checkout volume improve in the fourth quarter. Part of this increase can be attributed to a healthy spending environment and specific vertical exposure. In the US, we are focused on scaling our modern, best-in-class experiences. From a merchant perspective, we continue to see the greatest strength across large enterprises, platforms, and marketplaces. Winning checkout remains our most critical priority. Our goal is to drive more consumer engagement and a higher PayPal selection rate, which should accelerate TPV over time. Turning to PSP, As discussed throughout the past year, we moved rapidly within our Braintree business to prioritize healthy, profitable growth and intentionally let go of unprofitable volume. In line with this strategy, PSP processing volume grew 2% in the fourth quarter compared to 11% in the third quarter. Our conversations with merchants have become more holistic, moving beyond price and share of card processing to a deeper appreciation of our customers' needs and how we can add value through our full suite of solutions. We expect a handful of large Braintree merchant renegotiations to result in a headwind to revenue growth of about five points in 2025. Shifting away from this volume pressures gross revenue but is accretive to transaction margin dollars and will result in more than one point benefit this year. We expect this benefit to build over time as we drive more value-added services. Over the next few quarters, we will continue to work through renegotiations, at which point we should reach a new baseline to drive faster volume and revenue growth. Moving to more financial detail on slide 10, transaction revenue grew 4% on a spot basis to $7.6 billion, driven primarily by branded checkout and Venmo. Other value-added services revenue in the quarter grew 5% to $778 million. This acceleration was driven largely by a return to growth in credit revenue. We continue to see solid performance across our credit portfolio. As Alex shared, we have begun to modestly grow merchant originations and expect credit to be a positive revenue and profit driver in 2025. Transaction take rate declined by four basis points to 1.73%, driven largely by mix. Venmo monetization was a slight benefit, offset by merchant mix within branded checkout and Braintree, faster growth in payouts and foreign exchange. Turning to transaction margin dollars, the largest contributors were branded checkout, Venmo, interest on customer balances, a return to growth in credit, and Braintree. Transaction margin percent increased by more than 100 basis points for the second consecutive quarter, reflecting our focus on price-to-value and profitable growth. As planned, we increased our level of strategic investment in the quarter, growing non-transaction operating expense by 10%. This growth included marketing spend deferred from the first half of the year and efforts to support the rollout of new products and initiatives. Non-GAAP operating income grew 2% in the quarter to $1.5 billion. Non-GAAP operating margin declined 34 basis points to 18%. PayPal generated $2.2 billion of free cash flow in the quarter, bringing full-year free cash flow to $6.8 billion. This is meaningfully ahead of the $5 billion we planned for at the start of the year and includes some benefit from lower cash taxes, which we expect to be a headwind in 2025. In the quarter, we completed $1.2 billion in share repurchases, bringing full-year share repurchases to $6 billion. Finally, we ended the quarter with $15.4 billion in cash, cash equivalents and investments, and $11.1 billion in debt. Moving to guidance on slide 11 for the first quarter and full-year 2025, For the first quarter, we expect flat to low single-digit revenue growth on a currency-neutral basis, which is heavily impacted by the Braintree renegotiation efforts I discussed earlier. This also includes about a one-point headwind from lapping last year's leap day. We expect transaction margin dollars to be between $3.6 and $3.65 billion, which represents 5% growth at the midpoint. We are planning for low single-digit non-transaction OPEX growth in the quarter. And we expect to deliver non-GAAP EPS in the range of $1.15 to $1.17 or approximately 7% growth at the midpoint. Moving to the full year, we plan to continue guiding revenue one quarter at a time We believe this approach has served the company well during our transformation, enabling healthy, long-term decision-making that prioritizes driving faster transaction margin dollar growth. Over time, we are focused on accelerating both revenue and profitability. For the full year, we expect transaction margin dollars of approximately $15.2 to $15.4 billion, representing approximately 4.5% growth at the midpoint. In 2024, we had a two-point benefit from interest on customer balances. For 2025, our guidance includes about a $150 million or about a one-point headwind due to interest rate cuts. Excluding interest on customer balances, we expect transaction margin dollars to grow by at least 5% compared to 4.6% growth in 2024. In the first quarter, we expect minimal benefit from growth of interest on customer balances and then a headwind for the remainder of the year. One other factor to keep in mind is that in 2024, we saw a one-point benefit from transaction loss improvements. We are planning for some normalization in transaction loss during 2025 as we roll out new products. Our focus in 2025 is to strike the right balance between investment and productivity seeking to fund long-term investments largely through savings generated from better tech and automation deployment. We expect full-year non-transaction operating expenses to increase in the low single-digit range. There will likely be some unevenness quarter to quarter due to the timing of initiatives, marketing spend, and comparisons to the prior year. As a result, we expect second quarter OPEX growth to be higher than in other periods. We expect to deliver full-year non-GAAP EPS in the range of $4.95 to $5.10, representing about 8% growth at the midpoint. This includes negative impact from lower interest rates and just over a two-point increase in our expected non-GAAP effective tax rate. Our guidance also includes approximately $6 billion in share buyback. and we expect full year free cash flow of approximately $6 to $7 billion. I'd like to wrap up by thanking the PayPal team for their continued focus and dedication. The progress we made in 2024 gives us a strong foundation to build on as we move into the second year of PayPal's transformation. One of our primary focuses this year will be driving adoption of recent innovation and scaling better customer experiences. It will take time for some of our efforts to build and drive financial impact, but we are confident in our roadmap and in our execution plans. And we're excited to share more with you at our Investor Day on February 25th. With that, back to you, Alex.