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Venmo, long a centerpiece of PaypalThe history of growth growth but often criticized for its lack of monetization becomes a greater contributor to the company.
PayPal said in its press release on Tuesday first quarter that the revenues in Venmo increased by 20% in annual shift in the first quarter, although the company did not provide figure in dollars. Paypal acquired Venmo in 2013 thanks to the acquisition of the parent company Braintree.
Although it has long been a popular consumption service to send money to friends, Vendo's ability to generate significant income has been a major questioning point for investors, in particular as rivals like Zelle and Square The species has intensified.
The total VenMo payment volume increased by 10% compared to the previous year, but income increased twice as quickly, reflecting the business opportunity. Venmo only draws income from specific products like Pay with Venmo during the online cash register, Vendo flow cards and instant transfers, but not from peer-to-peer payments.
Before the report on gains, Jefferies analysts noted that Veno's growth in income seemed to “speed up strongly” and reported its growing contribution to the brand fund as a key area to look at. Compass Point analysts have also said that if Zelle and Square Cash competition remains fierce, Vendo's traction with debit cards and online payment could “open new monetization avenues” if adoption trends continue.
The company has added nearly 2 million Paypal and VEVMO debit card users for the first time during the quarter, and the total payment by debit card on Paypal and VenMo climbed more than 60%. Meanwhile, Pay with the Venmo transaction volume jumped 50% from one year to the next, and monthly VenMo debit card users increased by around 40%.
Paypal declared a better than expected profit for the quarter but missed income. The company has reaffirmed its directives in the full year, citing macroeconomic uncertainty.
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