PayPal Holdings (PYPL 0.60%) reported its third-quarter results after the market close on Monday, and it soared past already bullish estimates on Wall Street. This marks the second consecutive quarter of record-setting results for the company.
The digital payment processor reported record revenue of $5.46 billion, up 25% year over year, easily topping management's guidance for 23% growth. Profits were even more robust, with earnings per share of $0.86, soaring 121%, while adjusted EPS climbed 41%. Operating cash flow grew to $4.61 billion, up 40% year over year. Free cash flow also moved higher, climbing 43% to $3.97 billion.
Other metrics were in record territory for PayPal. Total payment volume (TPV) of $247 billion grew 38% year over year, its strongest growth in the company's history and accelerating for the second consecutive quarter, up from 29% growth in Q2 and 18% in Q1.
PayPal reported 15.2 million net new active accounts, the second-strongest quarterly growth in the company's history, bringing the total to 361 million, up 22%. To give that context, PayPal has added nearly as many new accounts over the past two quarters as it did for all of 2019. Customer engagement remained strong as well, with 40.1 payment transactions per account on a trailing-12-month basis, up 5%.
Venmo, PayPal's peer-to-peer payment system, continued to notch blockbuster growth. The service processed roughly $44 billion in TPV, and increase of 61% year over year.
PayPal kept on leaning into this unprecedented moment in history to expand its digital payments empire. The company increased its Buy Now, Pay Later suite of products, adding short-term installment loans in the U.S. and U.K. The fintech leader also added a new service during the quarter that allows users to buy and sell cryptocurrency, as well as use the digital assets as a payment method across its network.