PayPal is charting a bold course for its popular payment app, Venmo, with an ambitious strategy to boost revenue to $2 billion by 2027. With a strong foothold of 90 million users in the United States, Venmo has evolved into a cultural phenomenon, often used as a verb synonymous with transferring money to friends and family. Now, PayPal aims to deepen user engagement, positioning Venmo as the default choice for peer-to-peer transactions while expanding its role in spending, saving, and business transactions.
To achieve these goals, Venmo is expanding its partnerships with major companies, including DoorDash, Starbucks, and Ticketmaster. These collaborations are designed to push Venmo beyond the consumer market and integrate it further into business transactions. Notably, Venmo’s monetized monthly active users saw a significant 24% increase in 2024, showcasing its growing influence in the digital payment sphere.
Forecasted Growth and Projections for Venmo
Venmo’s user base is forecasted to experience mid-single-digit annual growth through 2027. In tandem, the Venmo debit card’s total payment volume is expected to rise at a more than 20% compounded annual growth rate over the same period. Furthermore, the “Pay With Venmo” feature is projected to expand at a double-digit rate through 2027. The number of merchants utilizing this feature increased by 50% from the previous year, indicating strong adoption among businesses.
PayPal’s last reported annual revenue figure for Venmo was approximately $900 million in 2021. The company’s new projections indicate a robust trajectory toward its $2 billion revenue target. Venmo is also anticipated to achieve high single-digit growth in transaction margin dollars and per-share earnings growth in the low teens by 2027.
In recent developments, PayPal has formed alliances with Instacart and MoonPay, further broadening Venmo’s reach. Additionally, JetBlue has become the first airline to allow customers to use Venmo for booking flights, marking a significant milestone in the app’s expansion into new sectors.
Despite these optimistic projections, PayPal faces challenges as it seeks to revitalize its growth strategy. While the company’s stock surged 40% in 2024, it has declined this year amid mounting pressure on its turnaround efforts. Nonetheless, PayPal remains committed to solidifying Venmo’s position as the “go-to money movement app” in the financial technology landscape.
What The Author Thinks
Venmo’s bold expansion strategy could position it as an even more dominant player in the financial services sector, but the road ahead is far from simple. While PayPal’s ambitious revenue targets are compelling, the pressure of revitalizing the growth strategy could overshadow these gains if market conditions or competition shift unfavorably.
