PayPal expects mobile payments to more than double

July 19, 2012

PayPal parent eBay released some healhty Q2 numbers this week, and the company sounded positively giddy about the future of mobile payments. The company reported revenue for Q2 of $3.4 billion, with $1.4 billion of that coming from PayPal, which achieved a 26 percent increase over the prior year.

Along with reporting earnings, eBay CEO John Donahoe spent considerable time on the call discussing eBay's mobile strategies, highlighting the company's focus on mobile payments and commerce. 

"As we consistently execute against our three-year growth plans," Donanoe said, "there is no question that an inflection point is occurring in retail. Mobile is revolutionizing how people shop and pay, becoming the digital nexus of consumers' lives. They want what they want, when they want it, anywhere, any time."

Donahoe said the company's PayPal division expects to handle $10 billion in transacted mobile payment volume in 2012. That's an increase of 150 percent over last year's figure.

Along with online mobile payments, 15 retailers were added to PayPal's offline, point-of-sale product in Q2, Donahoe said. Two retailers, Abercrombie & Fitch and Jos. A. Bank Clothiers, began rolling out PayPal acceptance nationwide. Abercrombie will feature PayPal as a payment method at the point of sale in more than 900 stores. Jos. A. Bank is looking to put PayPal in 550 of its U.S. stores. Four retailers in the U.K. are also accepting PayPal in-store. 

As for PayPal Here — the new mobile point-of-sale program the company introduced to compete with solutions from Square and VeriFone — the device and accompanying app were released in four markets during the second quarter. One of those markets is Japan, where PayPal announced a partnership with Softbank back in May. So far, 300,000 merchants have signed up for the device and are on the company's waiting list, Donahoe said. (The readers are due to ship this month.)

"Online and offline commerce is becoming seamless and global and retailers of all sizes need a partner who will help them navigate in this new world, compete effectively and deeply engage their consumers," Donahoe said. "And this is our focus: enabling commerce, helping consumers shop anytime, anywhere and helping retailers of all sizes compete and win in this new commerce environment."

Along with PayPal's focus on mobile products, eBay's Marketplace is seeing the effects of the mobile revolution. Donahoe said eBay's mobile apps have been downloaded nearly 90 million times.

"(S)ellers are listing almost two million items on mobile devices each week," Donahoe said. Popular items purchased over mobile devices include ladies handbags, of which one is purchased on eBay Mobile every 30 seconds. More than 8,000 cars and 340,000 car parts are sold each week through eBay mobile apps, Donahoe said.

"And mobile continues to attract new customers. In Q2, 600,000 new customers made their first purchase on eBay through our mobile apps," Donahoe said.

For more stories like this, visit the mobile/virtual wallet research center.

Topics: Mobile/Digital Wallet

Companies: PayPal , eBay

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