PayPal Unveils AI-Based Products to Boost Share Price
PayPal unveils new AI-driven products and a one-click checkout feature. CEO Alex Chriss aims to revive PayPal's declining share price. AI presents a significant opportunity for PayPal to leverage data insights.
PayPal, the global payments giant, has announced the launch of new artificial intelligence-driven products, along with a one-click checkout feature, in an effort to revive its share price. This marks the first major announcement under the leadership of CEO Alex Chriss, who joined the company in September. The move comes as companies across industries are capitalizing on investor enthusiasm for AI, which has propelled US stock markets to record highs.
Investors are hopeful that Chriss, a former senior executive at software company Intuit, will be able to turn around PayPal's stock, which has declined by over 22% since January 2023 due to underwhelming margins. Chriss has referred to 2024 as a "transition year" for PayPal and has pledged to drive revenue growth beyond transaction-related volume.
In an interview with Reuters, Chriss highlighted the potential of AI for PayPal, stating, "The data that we have and our ability to actually see what people have bought and know what merchants are trying to target, that's where I think AI is the huge opportunity for us."
Upon the announcement, PayPal's shares experienced a 4.6% decline as investors digested the news. However, analysts remain optimistic about the potential impact of these new products. Andrew Harte, an analyst at BTIG, stated in a research note, "The outcomes of the innovations... are promising and should improve consumer and merchant experiences."
One of the key offerings from PayPal is a platform that utilises AI to help merchants reach new customers based on their previous shopping history. This platform will leverage data from the vast amount of merchant transactions, totaling approximately half a trillion dollars, that PayPal has processed globally.
Additionally, PayPal will introduce a separate AI-based tool called "smart receipts," which will enable merchants to recommend personalised items to shoppers through email receipts. This feature will also include a cashback reward to enhance the shopping experience.
To streamline the checkout process, PayPal is introducing a "one-click" checkout feature called Fastlane. Early testing has shown that this feature can accelerate checkout speeds by nearly 40%. Furthermore, PayPal will introduce new features for Venmo business profiles.
The announcement from PayPal comes at a time when technology stocks are experiencing a rally, contributing to the S&P 500 index reaching its fourth consecutive record high close. PayPal is set to report its fourth-quarter earnings on February 7.
PayPal unveils new AI-driven products and a one-click checkout feature
CEO Alex Chriss aims to revive PayPal's declining share price
AI presents a significant opportunity for PayPal to leverage data insights
Source: REUTERS