PayPal draws takeover interest after shares fall 50%

PayPal Holdings Inc., a digital payments company based in San Jose, California, has reportedly attracted preliminary takeover interest following a significant drop in its stock value, which has fallen nearly 50% over the past year.

According to sources, the company has held meetings with banks amid unsolicited interest from potential buyers, with at least one large rival examining the possibility of acquiring the entire firm.

Other suitors are said to be interested in specific assets rather than the whole company.

The interest remains at an early stage and may not result in a transaction.

PayPal’s shares rose about 6.6% on the news, trading at around $44.38, with a market value of around US$41 billion.

🔗 Source: Bloomberg

🧠 Food for thought

Implications, context, and why it matters.

PayPal’s weak stock price sits alongside improving results

PayPal fell short of expectations in a recent quarter. In Q3 2025, it beat analyst forecasts on revenue and profit, lifted full-year guidance, and started a dividend 1.
Branded experiences TPV (total payment volume) rose 8% on a currency-neutral basis. Venmo revenue is tracking for more than 20% growth in 2025, excluding interest income 1.
Management raised its full-year non-GAAP (generally accepted accounting principles) EPS (earnings per share) growth outlook to 15% to 16%, pointing to free cash flow and a solid balance sheet 1.

A low valuation opens options for competitors and dealmakers

PayPal’s market value sits around $41 billion. The company projected $6 billion to $7 billion in adjusted free cash flow for 2025 1.
That gap could attract a private equity firm (an investment firm that buys and restructures companies), which could use cash flow to help pay acquisition debt.
A strategic rival could buy assets such as PayPal’s BNPL (buy now, pay later) business. Management said BNPL TPV may reach close to $40 billion in 2025 1.
Public markets often mark down mature tech firms that spend for long-term growth, which can leave openings for buyers willing to wait 1.