PayPal makes Venmo a standalone business unit as potential buyers circle
Enrique Lores, then-CEO of Hewlett-Packard, speaks on CNBC outside the World Economic Forum in Davos, Switzerland, on January 22, 2025.
Gerry Miller | CNBC
PayPal CEO Enrique Lores told executives this week that the firm is reorganizing its reporting lines to separate the popular mobile payment app Venmo from the company’s other operations, CNBC has learned exclusively.
Venmo will soon become a standalone segment within PayPal, making it easier to track progress or sell the business to another company, people with knowledge of the changes said.
PayPal is looking to hire a digital banking executive to run its new Venmo segment, said the people, who asked not to be named because they were not authorized to speak publicly.
The other two divisions will be a PayPal-branded business and payment services unit for merchants and consumers. Brain Tree People said unit and crypto operations.
Lores, who previously served as CEO of computer manufacturer HP for six years. comes into play as PayPal CEO in March believes a sharper corporate structure could reignite growth at a declining company Apple, Google and Stripe in the battle over e-commerce transactions. Lores replaces Alex Chriss, a former Intuit executive who is trying to revive a stock that has fallen nearly 80% from its pandemic-era peak.
PayPal’s rapid share decline attracted attention interest from potential bidders, including competitors Stripfor some or all of the company, Bloomberg reported in February. of the company hired According to Semafor, bankers should protect themselves against takeover bids or activist campaigns.
PayPal declined to comment for this story.
Shares of PayPal rose nearly 3% following the release of CNBC’s report.
Layoffs in uncertainty
The structural changes come amid threats of large-scale layoffs similar to those seen at payments rivals To obstruct. Earlier this year, PayPal executives were tasked by former CEO Chriss with a 15% reduction in headcount, but that effort was left uncertain by Chriss’ replacement, one of the people said.
With nearly 100 million users, Venmo is arguably PayPal’s most valuable independent asset due to its growth prospects. Analysts said it is a key target for potential buyers and could attract premium valuations.
Amidst the changes, two key executives Diego Scotti, Who was running the consumer group that included Venmo and Michelle GillBay, who oversaw a disintegrating small business group, is leaving, the people said. Scotti and Gill did not immediately respond to requests for comment.
The company will also establish a new artificial intelligence transformation group under its leadership. Anshu Bhardwajan old one Walmart Technology manager according to people. A financial services unit that supports other core business segments will be led by Scott Young, a former executive. Goldman Sachs People said he was a consumer banking manager.
PayPal announces first quarter results next week.
