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PayPal plans to eliminate about 20% of its workforce over the next two to three years, according to Bloomberg and The Wall Street Journal. With PayPal having reported 23,800 employees at the close of 2025, that figure translates to roughly 4,760 roles eliminated.
Management said the initiative is designed to deliver a minimum of $1.5 billion in gross run-rate savings across that same window. Lores, who took the helm in March, outlined a two-part approach: stripping out redundant structures and speeding up the integration of AI across the business. PayPal did not specify which business areas would be affected.
Profit for the quarter came in at $1.11 billion, equivalent to $1.21 per share, down from $1.29 billion, or $1.29 per share, in the same period a year ago. Revenue rose to $8.35 billion from $7.79 billion. After excluding one-time items, the company earned $1.34 per share on an adjusted basis, topping analyst expectations of $1.27 per share, with revenue also beating the $8.05 billion consensus, according to The Wall Street Journal.
The company's transaction margin dollars, which investors monitor as a key gauge of how much PayPal earns after processing costs, increased 3% to $3.81 billion. Payments processed across the platform totaled roughly $464 billion, an 11% increase. PayPal stock was down more than 8% in Tuesday trading.
In remarks to investors, Lores argued that the company has not put enough money into its technology infrastructure and has lost ground to rivals in financial services. "PayPal needs to focus," he said. "We need to recommit to the fundamentals." Among the areas he flagged for renewed investment are the core checkout experience, buy now pay later offerings, Venmo, financial services, and payment processing.
For the second quarter, PayPal expects adjusted earnings per share to be about 9% lower than last year. The company kept its full-year outlook the same, with adjusted earnings per share expected to be slightly down or up compared to the $5.31 reported in 2025.
The cost-cutting announcement came alongside PayPal's broader restructuring under Lores, brought in after the board determined that progress under his predecessor, Alex Chriss, had not moved quickly enough. PayPal also recently reorganized into three business units: Checkout Solutions and PayPal; Consumer Financial Services and Venmo; and Payment Services and Crypto. The company recorded $10 million in CEO exit costs related to Chriss's departure during the first quarter.
At HP, where Lores previously held the top job, he built a reputation for cutting complexity and steering the business toward AI and subscription-based models, according to The Wall Street Journal. During the first quarter, PayPal bought back about 34 million shares at a total cost of $1.5 billion and declared a quarterly cash dividend of $0.14 per share, payable June 25, 2026.