What happened

Shares of PayPal Holdings (NASDAQ:PYPL) jumped 13.3% in October, according to data from S&P Global Market Intelligence, after the payment-technology leader released strong third-quarter 2017 results and boosted its full-year guidance.

PayPal stock jumped more than 6% on Oct. 20 alone, when the company revealed that its quarterly revenue had climbed 21.3%, to $3.24 billion. That translated to 31% growth in adjusted net income to $560 million, or $0.46 per diluted share. Both figures comfortably topped Wall Street's consensus estimates. which called for adjusted earnings of $0.43 per share on revenue of $3.18 billion.

Hand holding a smartphone with the PayPal app open

IMAGE SOURCE: PAYPAL.

So what

The underlying drivers of PayPal's business were equally impressive. The company added 8.2 million active customer accounts, good for net new active account growth of 88%. That left it with 218 million active accounts at the end of the quarter, including over 17 million merchant accounts. The company also processed 1.9 billion payment transactions during the quarter, up 26% year over year, helped by 9% growth in payment transactions per active account to 32.8. All told, PayPal processed $114 billion in total payment volume, up 30% from the same year-ago period.

"Putting our customers first in everything we do, enhancing our suite of products and services, and partnering with some of the world's most popular brands are delivering tangible results," added PayPal CEO Dan Schulman. "As the world rapidly accelerates to digital payments, we have a tremendous opportunity in front of us."

Now what

If that wasn't enough, PayPal also boosted its full-year guidance to call for revenue growth of 19% to 20%, up from 18% to 19% previously, including 20% to 22% growth in the fourth quarter. On the bottom line, PayPal says, that should result in full-year adjusted earnings per diluted share of $1.86 to $1.88, up from its previous EPS guidance range of $1.80 to $1.84.

It should come as no surprise, then, that PayPal stock has continued to drift higher since its report, setting a fresh 52-week high last week as Wall Street adjusts its models to account for the company's relative outperformance. Shares are up nearly 90% so far in 2017, and I suspect the stock will only continue to rise as the digital-payment industry becomes more widespread. 

Steve Symington has no position in any of the stocks mentioned. The Motley Fool owns shares of and recommends PayPal Holdings. The Motley Fool has a disclosure policy.