Earlier today, PayPal released the financial and operating results from our third quarter.
Five things to know about PayPal’s Q3 2018:
1. We set a record for net new actives added in a quarter
Perhaps the most exciting and noteworthy accomplishment this quarter is the fact that we added a record-setting 9.1 million net new active accounts to our platform. We have added 34 million net new accounts in the past 12 months - an average that is approaching 3 million net new customers per month - pushing our total active accounts past the quarter billion mark to 254 million.
2. We continue to deliver strong and consistent financial results, and are extending our leadership position in mobile
We drove strong financial results across the board in Q3, showing double-digit growth in key areas such as revenue ($3.68 billion, up 14% year over year), non-GAAP operating income ($787 million, up more than 21% year over year), and non-GAAP earnings per share (EPS) ($0.58, up 26% year over year). During the quarter we drove 2.5 billion transactions, an increase of 27%, while our engagement per active user increased 9.5% to 36.5 times per year.
A major driver of engagement is the use of mobile devices across our platform, predominantly driven by our market-leading checkout conversion rates with One Touch. One Touch continues to expand, with 112 million consumers and 10.4 million merchants using One Touch. In Q3, we saw mobile growth of 45%, and approximately $57 billion of mobile volume processed in the quarter. Mobile checkout now represents 40% of our total payment volume. For the third quarter in a row, Venmo posted record net new actives, and volume accelerated to $16.7B, with an annualized run rate approaching $70 billion.
3. Our platform is attracting some of the largest brands in the world including Walmart (#1 in Fortune 100) and Chevron (#13 in Fortune 100)
In the quarter, we announced that we are deepening our relationship with Walmart and will make PayPal Money Services available at all Walmart locations in the U.S. beginning in November. We also signed a comprehensive agreement with Chevron to launch a new mobile payment app in early 2019 that will reduce the amount of time that a customer spends at the pump. Both of these relationships demonstrate how we are using PayPal’s extensive platform capabilities to help our partners create differentiated customer experiences. We look forward to long, productive relationships with both companies.
4. Our strategic partnership with American Express will create new and unique commerce experiences for our mutual customers
Over the next several quarters, PayPal will have enhanced access to American Express as a payment option in our wallet. The agreement will allow PayPal to access American Express tokens and enables a deep integration of our Venmo and PayPal P2P capabilities within the Amex platform. Additionally, PayPal and American Express users will be able to use their American Express rewards points to pay for their purchases at millions of PayPal merchants around the world. Over the next year, we will roll out these capabilities to our mutual customers, and we are pleased to begin what will be an important relationship for both companies.
5. We continue to innovate, particularly in mobile, and are bringing new product experiences to our global customers, including:
An enhanced PayPal mobile app that makes it easier than ever to send or request money.
The launch of Funds Now, giving PayPal businesses in good standing access to their sales within minutes at no extra cost. By eliminating holds, delays and reserves, we are providing our merchants immediate access to the funds they need to invest back into their business, pay their bills and service their customers.
The global roll out of PayPal Checkout with Smart Payment Buttons, which improves the purchase experience by dynamically presenting the most relevant payment methods to each shopper, including PayPal, PayPal Credit, Venmo and a wide range of alternative payment methods.
We are also seeing accelerating momentum across all of Venmo’s monetization efforts. Since launch, more than 24% of all Venmo users have participated in a monetizable action, while Pay with Venmo monthly active users increased approximately 185% month-over-month in September versus August.
Taken together, it is clear that PayPal is firing on all cylinders. We are partnering with many of the biggest names in commerce, retail, technology, and finance. We are extending our leadership in mobile and furthering our mission to democratize financial services and commerce capabilities for merchants and consumers around the world. We are growing our active customer base at a record clip and benefitting from our global scale. And we are doing all of this while delivering on our financial commitments.
I am extremely proud of the PayPal team and the incredible work they are doing to provide ever-increasing value for our customers. Their efforts are clearly reflected in our results and in the work we are doing to seize our massive opportunity. As proof of that, Interbrand recently announced that PayPal had increased its brand value by 22% in the last year making us one of the six fastest growing brands in the world. The accomplishments of our team enable us to continue growing and create sustainable and long-term value for our shareholders.