PayPal evolves cross-border payments offering with PayPal World and stablecoins
PayPal’s Q2 2025 earnings saw the company shift cross-border focus with the launch of PayPal World and expanded stablecoin offerings.
PayPal’s Q2 2025 earnings saw the company continue to frame itself as a brand at the forefront of change in payments. CEO Alex Chriss said that “the next five years are likely to see more change in how people shop than the last two decades combined”, with the company seeing AI in particular transforming the consumer experience dramatically.
This vision is central to much of how Chriss is changing PayPal, which he highlighted in detail at the company’s recent investor day, however this latest earnings call provided some key insights into how the company is approaching cross-border payments in particular as part of this transformation.
The company, which reported a 5% YoY increase in net revenue to $8.3bn in Q2 2025, had seen its focus on its cross-border payments units reduce in recent earnings calls, including via a change in some of its reporting. However, this latest release followed last week’s announcement of cross-border payments interoperability solution PayPal World and included key updates about the project, as well as wider updates on its cross-border payments initiatives – including its stablecoin PYUSD.
Topics covered:
- PayPal World sees PayPal enter Alipay+ territory
- PYUSD stablecoin as a cross-border payments instrument
- Cross-border payments volume growth continues
- Venmo leads TPV growth
PayPal World sees PayPal enter Alipay+ territory
The earnings call saw CEO Chriss provide greater information about PayPal World, a solution the company announced the previous week that he described as a “game changer for [PayPal’s] branded experiences”. Framed as an international digital wallet platform, it is designed to interconnect participating digital wallets, allowing users of those wallets to make cross-border payments online, in stores abroad and to other users using the company’s rails.
Users of participating brands will be able to make payments via PayPal’s existing branded checkout integration, as well as making P2P payments across different wallets. It is also set to support both stablecoins and agentic commerce, with the company expecting AI-based payment solutions to become increasingly popular.
Set for launch later this year, PayPal World will initially connect the company’s Venmo and PayPal digital wallets, as well as India’s UPI and the wallets of Brazil’s Mercado Pago and China’s Tencent-owned Tenpay Global. The company says this will see “more than two billion” users covered globally, around a quarter of which are set to be from UPI alone.
This represents a significant advancement for many of the participating wallets. UPI, for example, has seen dramatic growth over the past few years, but has so far remained largely domestic aside from some country-specific partnerships. The move also brings long-awaited cross-border capabilities to PayPal’s US-only wallet Venmo.
Chriss also said that the company has seen inquiries from “multiple” other wallet providers since it announced the launch.
The move puts PayPal directly in competition with Alipay+, Ant International’s cross-border mobile payment platform that already interconnects more than 30 digital wallets, including leading Chinese brand Alipay as well as Philippine-based GCash, Singapore’s GrabPay and South Korea’s Kakao Pay. Similar to PayPal World, wallets connected on Alipay+ can be used in-store and online to make payments at supporting merchants globally, although the platform does not also provide P2P payments. While largely concentrated in Asia, Alipay+ has been making moves to expand into Europe, and already has a significant merchant presence in the region.
PYUSD stablecoin as a cross-border payments instrument
Chriss also addressed the company’s stablecoin PayPal USD (PYUSD) during the Q2 2025 earnings call, saying that it will be a “major enabler” of the PayPal World platform when it launches.
He characterised the stablecoin as central to the company’s ongoing cross-border payments strategy, framing PYUSD as “a pivotal part of [PayPal’s] mission to advance global commerce”. He said that it would address customer pain points, “namely the burdens of high fees and the slow speed of cross-border money transfers”.
Although still significantly below the $64bn circulation of Circle’s USDC stablecoin, PYUSD has seen its use trend upwards since its launch two years ago and its circulation currently stands at $910m.
PYUSD is already supported as an option to fund P2P payments across Xoom and PayPal, and PayPal is working to “expand [its] prominence as a commerce-first stablecoin with a network of exchanges, custodians and other payments partners, including Coinbase”.
This follows the launch of Pay with Crypto the previous day, which sees PayPal build its presence in the rapidly growing stablecoin acceptance space. This enables merchants to accept payments from over 100 cryptocurrencies, including stablecoins, across a variety of leading wallets, with instant conversion into either stablecoin or fiat currency, depending on the merchant’s preference.
With a transaction fee of 0.99%, the move is designed to undercut cross-border card payments, with PayPal saying it decreases the cost of transactions by “up to 90% compared to international credit card processing”.
The company has also broadened the availability of PYUSD this quarter, as well as adding the ability to earn rewards for holding the stablecoin in Venmo.
Cross-border payments volume growth continues
In addition to an increase in net revenue, PayPal also reported a 7% YoY increase in transaction margin dollars to $3.8bn, or 8% excluding the interest it earned on customer balances, as well as a 14% rise in GAAP operating income to $1.5bn. The company also increased its earnings-per-share guidance for the year.
Meanwhile, total payment volume (TPV) grew 6% YoY to $443.5bn. Within this, international TPV climbed at a faster rate than the US, at 10% compared to the US’s 4%.
Notably, cross-border TPV, which covers all payment volume across two currencies, saw significantly higher growth than overall, increasing 10% YoY to $54bn.
Venmo leads TPV growth
PayPal used to break out its overall TPV to include a segment for P2P payments excluding Venmo, which covered PayPal P2P and remittances brand Xoom. This was the best measure of its cross-border P2P payments, however it has recently refined its main breakout of TPV to primarily report P2P and other consumer, which includes Venmo P2P & debit and PayPal debit alongside Xoom and PayPal P2P. This group saw the strongest YoY increase among its three main segments, climbing 10% YoY to around $120bn.
However, it appears that this segment is not being grown by its cross-border P2P offerings. P2P TPV, which excludes the debit elements of the P2P and other consumer category, saw an 8% YoY increase to $108bn, while domestic-only Venmo TPV grew 12% YoY to $82bn. This therefore suggests that P2P excluding Venmo – covering PayPal P2P and Xoom – saw around a -4% YoY decline.
However, the company’s payment services provider (PSP) segment appears to be a bigger drag for the company, seeing YoY growth of just 2%, something that the company attributed to headwinds from the US tariffs. It also drove a -5% YoY drop in the number of payment transactions PayPal processed this quarter; without the segment, transactions grew by 6% YoY.
This drop, as well as a lack of sharp improvement on other metrics, prompted a negative reaction from investors, with the company’s share price dropping following the earnings announcement.
