PayPal is planning a major change to improve its business, especially after its stock price dropped and layoffs are expected. During its latest earnings call, CEO Enrique Lores said the company wants to “become a technology company again.” This mainly means focusing more on artificial intelligence (AI).
The company made it clear that AI will play a big role in its future. PayPal plans to upgrade its technology systems, move faster to cloud-based platforms, and use AI more in software development. This will help developers work faster and release products more quickly.
Compared to other tech companies, PayPal is a bit late in adopting AI. Many companies already use AI tools for coding and improving productivity. Now, PayPal is trying to catch up.
To support this shift, the company has created a new team focused on “AI transformation.” At the same time, PayPal plans to reduce its workforce by about 20% over the next two to three years, which could mean more than 4,500 job cuts. These changes, along with AI adoption, are expected to save the company around $1.5 billion.
PayPal is also reorganizing its business into three main parts:
- Checkout and PayPal services
- Consumer financial services (including Venmo)
- Payment services and crypto
AI will not only be used in coding but also in customer service, support, and risk management. The CEO said AI will help redesign how the company works and improve efficiency.
Even though PayPal reported revenue of $8.4 billion (a 7% increase), its future outlook is weak, which caused its stock to fall. The company’s stock has already dropped more than 80% since its peak in 2021.
When asked about selling Venmo, the CEO said there are no immediate plans, but he is open to future decisions that increase company value.
Overall, PayPal’s move shows how companies are using AI to cut costs and improve performance, but it also raises concerns about job losses.
