EBay to ditch PayPal as main payment processor starting in 2020
- Author: David Armstrong Feb 02, 2018,
Feb 02, 2018, 21:16
The Stock has YTD (year to date) performance of 15.89 percent. PayPal was originally bought by eBay in 2003 and soon after became the platform's default payment option. The average volume was noted at 8554.67K shares while its relative volume was seen at 1.5. PayPal Holdings Inc would still remain a payment option as eBay expects the "transition to full payments intermediation will be a multi-year journey".
PayPal's success spawned competition, which included Adyen, Skrill, Payza, Google Wallet, Amazon Payments, Apple Pay and Samsung Pay. The company's business is exclusively focused on providing back-end payments services like credit card processing to businesses, which means unlike PayPal, users won't see any Adyen payment buttons pop up on eBay.
Shares of the San Jose, California-based e-commerce company climbed almost 9 percent to a record high in after-hours trading on Wednesday. As a matter of fact, eBay purchased the online payment company for $1.5 billion United States dollars in 2002. Shorter moving average timeframes are more sensitive to price fluctuations and can pick up on trend changes more quickly than longer-term moving averages.
EBay now represents 13 per cent of transactions processed by Paypal.
eBay has confirmed it will not be renewing its contract with the online payments system PayPal.
PayPal's new strategic direction has led to partnerships with numerous large financial institutions and big technology companies including Alphabet Inc's (GOOG.O) Google, Apple Inc (AAPL.O), Mastercard Inc (MA.N), Visa Inc (V.N) and JPMorgan Chase & Co (JPM.N).
Though they were part of the same company for 13 years, eBay and PayPal were split into independent standalone businesses in 2015.
Analysts on average were expecting earnings of 52 cents per share, according to Thomson Reuters I/B/E/S. Fourth-quarter revenue rose 9.1 percent to $2.61 billion. By doing this, eBay says it will be able to "further innovate on behalf of its customers".
"EBay was restricted for a period of time from having another payment service", Rainey said.
So this breakup has got to sting a little, even if PayPal has long since moved on to sowing its wild oats across the rest of the e-commerce industry. The separation included an agreement that eBay would continue to use PayPal to process payments on the site. In mid-2014, around the time PayPal was beginning to eclipse eBay in value, the latter company provided more than 30 per cent of PayPal's profits and 50 per cent of its revenue, per Recode.