PayPal finally addressed the $53bn offer sitting on its table. Its answer was: not at that price.

The company gave its first public response on Tuesday’s Q2 earnings call, alongside a beat. Chief executive Enrique Lores would not comment on Stripe and Advent’s bid directly. He said only that PayPal would “carefully consider” any path that created “superior value for our shareholders than executing our current strategy,” he told investors. Then he made clear he did not think Stripe’s offer cleared that bar.

Open, but not at $60.50

PayPal has already rebuffed the bid as too low, and the results gave it cover to hold that line. Stripe and Advent are offering $60.50 a share. On his own LinkedIn, Lores said he was “encouraged by the progress” and had “strong conviction in our direction.”

He has a number to point to. Cantor values PayPal closer to $70 a share, well above the offer, with the stock trading around $58. So even a friendly read says $60.50 undersells the company, if the turnaround lands.

A quarter to back it up

The results helped. Revenue rose 5% to $8.68bn, beating estimates, and adjusted earnings of $1.38 a share came in ahead of the $1.28 analysts expected. Net income slipped to $1.1bn, but PayPal raised its full-year guidance and now expects a key profit measure to grow this year rather than shrink, the Wall Street Journal reported.

There is a caveat. Transaction-margin dollars rose just 1%, dragged by falling interest on customer balances as rates eased. Strip that out and the underlying figure grew about 3%. The payments business did a little better than the headline showed, and shares rose around 4%.

The plan shareholders must trust

All of this rests on a turnaround still in progress. Lores has split PayPal into three units, is chasing $1.5bn in run-rate savings over two to three years, and is cutting roughly a fifth of staff while pushing AI into coding, support and risk. He calls it “improving execution.”

The trouble is the ask. PayPal has not opened a public auction, the usual way to find the real price. It is asking holders to trust the plan instead. As The Information’s Martin Peers noted, that is a lot to ask from a board that owns about 0.6% of the company, with a stock down roughly 80% since 2021 and a chief executive who took over in March and has never run a payments firm.

The Stripe irony

The bidder is the rival that helped make PayPal a laggard. Stripe is flush with cash and shopping, part of a wider wave of payments consolidation. For a company trying to reshape how money moves online, buying the incumbent would be a shortcut. PayPal, for now, would rather bet on itself, and dare Stripe to pay up.

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