PayPal Stock Soars After OpenAI Partnership, Dividend Debut & Strong Forecast

PayPal Holdings Inc. is truly making headlines and the truth is that it is deserved! The stock jumped 14% premarket after revealing a strategic partnership with OpenAI, declaring its first-ever dividend, increasing its full-year forecast, and furnishing investors with insight into Venmo's growth.

PayPal Marries Big with OpenAI

The two big players combined in the AI-commerce space — PayPal and OpenAI are going to power payments directly within ChatGPT. Soon, a user can choose PayPal as the payment option during checkout, and PayPal will process payments for vendors using OpenAI's Instant Checkout means.

"By partnering with OpenAI and adopting the Agentic Commerce Protocol, we're enabling seamless payments — helping people go from chat to checkout in just a few taps," said Alex Chriss, PayPal's CEO.

The partnership aligns PayPal with other e-commerce leaders like Shopify and Etsy, who have integrated OpenAI-powered checkout systems.

PayPal Announces First Dividend

For the maiden time in its history, the company will pay shareholders a quarterly dividend of $0.14 per share, which is 10% of adjusted net income. It should be payable on December 10, 2025, to shareholders of record at the close of trading on November 19, and this will represent about 0.8% annual return.

This particular topic underlines that PayPal is embracing shareholder value, alongside the ongoing stock buyback scheme worth $6 billion.

Stronger Financial Outlook

PayPal lifted its full-year outlook to transaction margin dollars between $15.45 billion and $15.55 billion, an upward revision from its previous target range. Adjusted EPS are expected to range from $5.35 to $5.39, again, above earlier guidance of $5.15 to $5.30.

In Q3 2025, the company reported transaction margin dollars of $3.9 billion and adjusted EPS of $1.34, up 12% YoY, beating analyst expectations of $1.20.

Venmo Revenue Shines

After years of unanswered questions about revenue by industry analysts, PayPal finally came out with the news and shared that in the year 2023, Venmo as a peer-to-peer payment app is expected to make a record revenue of $1.7 billion, almost twice the $900 million it made in 2021.

The agency's growing revenue share reflects PayPal's success in monetizing user transactions via in-store and online payments, debit cards, and instant transfers-from being just an app that leveraged simple payments of 'friend-to-friend' into a key revenue driver.

CEO's Vision

"This is a stronger company today than we were two years ago," said Chriss. "With clear strategic direction and building momentum, we are exceptionally well-placed to win into the future."

With AI integration, enhanced shareholder returns, and robust financials, PayPal’s comeback is a renewed interpretation on the investor side and an apt stride forward in the marriage of AI and digital payments.