PayPal saw Q4 2015 revenue jump 21 per cent to $2.6 billion boosted in part by the acquisition of remittance firm Xoom, as well as the take-up of other forms of mobile payments.
The US firm said the takeover of Xoom, which closed during Q4, added one percentage point to overall revenue growth, as well as 1.6 million active customer accounts to the PayPal platform.
Xoom enables users to send remittances internationally from an app on their smartphones rather than through the likes of Moneygram. In the full year, the remittance firm is expected to deliver an additional $200 million in revenue, said PayPal.
The overall volume of payments carried by PayPal increased dramatically by 29 per cent, year-on year, to $82 billion. Adoption of mobile payments has a significant role in this growth, now representing 25 per cent of total payment volume. A year ago, it was 21 per cent.
Other evidence of how PayPal is increasingly mobile oriented is the rapid growth of Venmo, which enables users to send P2P payments via its app. The service has traction among millennial users in the US. The volume of payments sent via the Venmo app grew by 174 per cent in Q4 to $2.5 billion.
In addition, PayPal has seen the volume of payments handled by Braintree quadruple since its acquisition two years ago. Braintree processes payments for leading apps, including Uber.
The major challenge for the payments firm now is gaining a greater presence in the point-of-sale market, where it is in competition with the likes of Apple Pay and Samsung Pay. Despite having been trying longer to establish itself than either rival, PayPal is struggling to make an impact in contactless payments.
Net income in the quarter grew to $367 million from $286 million a year ago.