Stripe and Advent return for PayPal above $60.50 as AI shopping makes the account base the prize
The Wall Street Journal reports Stripe and Advent are back above the $60.50 a share PayPal's board rejected in August, days before PayPal's first earnings print since the walk-away. The prize is the 430-million-account consumer network that AI shopping is about to make decisive.
Richard Tang · 2 min read
Stripe and private equity firm Advent International are negotiating a renewed takeover of PayPal−3.33% — PayPal, down 3.33 percent today above the $60.50 a share, roughly $53 billion, that PayPal's board rejected in August, according to The Wall Street Journal, with about $50 billion of bank financing lined up and each side taking an equal stake 1. PayPal reports third-quarter results on October 27, the first numbers either side can argue with since the board said no 2. The timing is not an accident.
The price they came back with is the tell
The buyers walked away in August rather than sweeten the offer, and PayPal's stock fell 12.7% that morning 2. Returning with more money, after being refused once, means they want the one asset PayPal owns that money cannot rebuild quickly: a 430-million-account consumer network anchored by Venmo, paired with Stripe's merchant-side infrastructure, which processes around $1.9 trillion a year against PayPal's close to $1.8 trillion 1. A combined company would face Block and Adyen with volume neither can match at checkout 1.
What makes the network worth the bid is AI shopping
Checkout is moving. PayPal is now the only native in-app checkout partner on Glance, InMobi's AI shopping app, and already handles checkout inside ChatGPT 2. If AI agents do the buying, the agent needs somewhere trusted to hold the card number. That is the thing Stripe never built, and it is the link that turns a payments deal into a bet on agentic commerce.
The core business has to justify any of it
Q2 revenue rose to $8.68 billion while transaction margin dollars, PayPal's profit after processing costs, grew just 1%, and operating margin fell to 16.4% 2. Lores is betting a cut of about 20% of the workforce, worth at least $1.5 billion in savings, closes that gap 1. Wednesday's print tests it.
PayPal revenue keeps climbing while operating margin falls to a two-year low
- Revenue ($B)
- Operating margin (%)
Data
| Revenue ($B) | Operating margin (%) | |
|---|---|---|
| Q3 '24 | 7.85 | 17.7 |
| Q4 '24 | 8.37 | 17.2 |
| Q1 '25 | 7.79 | 19.6 |
| Q2 '25 | 8.29 | 18.1 |
| Q3 '25 | 8.42 | 18.1 |
| Q4 '25 | 8.68 | 17.4 |
| Q1 '26 | 8.35 | 17.8 |
| Q2 '26 | 8.68 | 16.4 |
If the deal signs, PayPal holders get the premium and the banks carry $50 billion of credit risk on a company trading at 10.3x forward earnings 12. If it does not, the turnaround has to work on its own. Either way, the consumer account base is the prize, and AI shopping is the battlefield that repriced it.
BofA's+0.65% — BofA, up 0.65 percent today sell rating with a $53 target, reported earlier this month, now sits below even the rejected bid; the renewed talks are what has changed since 1.
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