PayPal Holdings, Inc. (PYPL) raised its full-year non-GAAP earnings outlook after non-GAAP results reversed a second-quarter decline, even as reported revenue growth slowed for a third straight quarter.

The digital payments company said it is raising full-year non-GAAP transaction margin dollars and EPS guidance and reaffirming GAAP EPS guidance. Full-year 2026 non-GAAP EPS guidance moved to about $5.60 from about $5.38 in July. Fourth-quarter non-GAAP EPS guidance was about $1.43.

President and CEO Enrique Lores said the company is beginning to see its strategy translate into financial results, with strong contributions from key growth areas and increasing diversification.

Net revenues increased 2% to $8.6 billion, or 1% currency-neutral, after 5% growth in the second quarter and 7% in the first. Transaction margin dollars increased 2% to $4.0 billion. Transaction margin dollars excluding interest on customer balances increased 3% to $3.7 billion.

GAAP operating income decreased 8% to $1.4 billion, and GAAP operating margin contracted 173 basis points to 16.3%. GAAP earnings were $1.25 a share, down 4%. Non-GAAP operating income increased 3% to $1.6 billion, and non-GAAP operating margin expanded 16 basis points to 18.8%, reversing a 248 basis-point contraction in the second quarter. Non-GAAP EPS increased 8% to $1.45, reversing a 1% non-GAAP decline in the prior quarter.

Total payment volume increased 6% to $487.1 billion, or 7% currency-neutral, after 10% growth in the second quarter and 11% in the first. Payment transactions increased 7% to 6.8 billion, including 7% growth excluding payment service provider transactions.

Payment transactions per active account on a trailing 12-month basis increased 6% to 60.8, accelerating from 3% in the second quarter and a 1% decline in the first. Active accounts increased 0.6% to 440 million, or 1.6 million sequentially, after a 0.04% sequential decline in the second quarter.

Transaction revenues were $7.711 billion, up 3% from a year earlier. Revenues from other value added services were $873 million, down 2% year over year. U.S. net revenues were $5.002 billion, up 5%. International net revenues were $3.582 billion, down 2%, or down 4% currency-neutral. Transaction margin was 46.0%, up from 44.9% in the second quarter.

Cash flow from operations was $1.6 billion and free cash flow $1.4 billion. Adjusted free cash flow was $2.0 billion. Cash, cash equivalents, and investments totaled $15.1 billion as of September 30, 2026. Debt totaled $13.5 billion.

PayPal returned $1.5 billion to stockholders by repurchasing approximately 28 million shares in the third quarter. On a trailing 12-month basis, it returned $6.0 billion by repurchasing approximately 117 million shares. The board declared a cash dividend of $0.14 a share, payable December 24, 2026.