What changed in this filing

/stocks — the workspaceLOADING

Item 9A. Controls and Procedures

2026-02-03 compared with 2025-02-04 · 599 added, 525 removed, 1852 unchanged (38% of the section changed)

12 unchanged sentences

An equity trading plan is a written document that preestablishes the amounts, prices, and dates (or formula for determining the amounts, prices, and dates) of future purchases or sales of the Company’s stock, including sales of shares acquired under the Company’s employee and director equity plans.

On December 10, 2024 , Frank Keller , Executive Vice President, General Manager – Large Enterprise and Merchant Platform Group , entered into an equity trading plan that is intended to satisfy the affirmative defense conditions of Rule 10b5-1(c) under the Exchange Act.

The trading plan has a duration of March 11, 2025 to December 5, 2025 with approximately 27,700 shares (vested and net shares expected to vest over the duration of the trading plan) subject to sale under the plan.

During the quarter ended December 31, 2025, each of the following Section 16 officers adopted an equity trading plan that is intended to satisfy the affirmative defense conditions of Rule 10b-1(c) under the Exchange Act:

• Frank Keller , Executive Vice President, General Manager – Large Enterprise and Merchant Platform Group , adopted a trading plan on October 30, 2025 .

The trading plan is scheduled to expire no later than December 15, 2026 with approximately 62,100 shares (vested and net shares expected to vest over the duration of the trading plan) subject to sale under the plan.

• Suzan Kereere , President, Global Markets , adopted a trading plan on November 14, 2025 .

The trading plan is scheduled to expire no later than March 10, 2027 with approximately 82,100 shares (vested and net shares expected to vest over the duration of the trading plan) subject to sale under the plan.

• Christopher Natali , Senior Vice President, Chief Accounting Officer , adopted a trading plan on November 18, 2025 .

The trading plan is scheduled to expire no later than December 5, 2026 with approximately 8,000 shares (vested and net shares expected to vest over the duration of the trading plan) subject to sale under the plan.

DISCLOSURE REGARDING FOREIGN JURISDICTIONS THAT PREVENT INSPECTIONS

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Incorporated by reference from our Proxy Statement for our 2026 Annual Meeting of Stockholders to be filed with the SEC within 120 days after December 31, 2025.

FY 2025 FORM 10-K

Insider Trading Policies and Procedures

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Incorporated by reference from our Proxy Statement for our 2026 Annual Meeting of Stockholders to be filed with the SEC within 120 days after December 31, 2025.

FY 2025 FORM 10-K

EXHIBITS, FINANCIAL STATEMENT SCHEDULES

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The information required by this Item is set forth in the Index of Exhibits that precedes the signature page of this Annual Report.

FY 2025 FORM 10-K

Report of Independent Registered Public Accounting Firm

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We have audited the accompanying consolidated balance sheets of PayPal Holdings, Inc.

and its subsidiaries (the “Company”) as of December 31, 2024 and 2023, and the related consolidated statements of income (loss), of comprehensive income (loss), of stockholders’ equity and of cash flows for each of the three years in the period ended December 31, 2024, including the related notes and schedule of valuation and qualifying accounts for each of the three years in the period ended December 31, 2024, listed in the index appearing under Item 15(a)(2) (collectively referred to as the “consolidated financial statements”).

and its subsidiaries (the “Company”) as of December 31, 2025 and 2024, and the related consolidated statements of income (loss), of comprehensive income (loss), of stockholders’ equity and of cash flows for each of the three years in the period ended December 31, 2025, including the related notes and schedule of valuation and qualifying accounts for each of the three years in the period ended December 31, 2025 appearing under Item 15(a)(2) (collectively referred to as the “consolidated financial statements”).

We also have audited the Company’s internal control over financial reporting as of December 31, 2025, based on criteria established in Internal Control - Integrated Framework (2013) issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO).

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and (iii) provide reasonable assurance regarding prevention or timely detection of unauthorized acquisition, use, or disposition of the company’s assets that could have a material effect on the financial statements.

FY 2025 FORM 10-K

Because of its inherent limitations, internal control over financial reporting may not prevent or detect misstatements.

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The communication of critical audit matters does not alter in any way our opinion on the consolidated financial statements, taken as a whole, and we are not, by communicating the critical audit matter below, providing a separate opinion on the critical audit matter or on the accounts or disclosures to which it relates.

Allowance for Consumer Loans Receivable

As described in Notes 1 and 11 to the consolidated financial statements, the total allowance for loans and interest receivable was $461 million as of December 31, 2024, of which $341 million relates to consumer loans receivable.

The allowance for consumer loans receivable is primarily based on expectations of credit losses based on historical lifetime loss data and incorporates macroeconomic forecasts applied to the portfolio.

The consumer loss models incorporate various portfolio attributes including geographic region, loan term, delinquency, credit rating, vintage, and for the revolving credit portfolio, macroeconomic factors such as forecasted trends in household disposable income and retail e-commerce sales.

The forecasted macroeconomic factors are sourced externally, using a single scenario to reflect the economic conditions applicable to a particular period.

The principal considerations for our determination that performing procedures relating to the allowance for consumer loans receivable is a critical audit matter are (i) a high degree of auditor subjectivity and effort in performing procedures and evaluating audit evidence relating to certain consumer loss models, and for the revolving credit portfolio, forecasted macroeconomic factors related to household disposable income and retail e-commerce sales used to estimate expected credit losses;

and (ii) the audit effort involved the use of professionals with specialized skill and knowledge.

Allowance for Certain Consumer Loans Receivable

As described in Notes 1 and 11 to the consolidated financial statements, the total allowance for consumer loans receivable was $369 million as of December 31, 2025.

The allowance for consumer loans receivable is primarily based on expectations of credit losses using historical lifetime loss data and incorporates macroeconomic forecasts applied to the portfolio.

For certain consumer loans, the forecasted macroeconomic factors are sourced externally, using probability weighted multiple economic scenarios considering the economic conditions applicable to a particular period.

The principal considerations for our determination that performing procedures relating to the allowance for certain consumer loans receivable is a critical audit matter are (i) a high degree of auditor subjectivity and effort in performing procedures and evaluating audit evidence related to certain consumer loss models, and for the revolving credit portfolio, the macroeconomic factors related to the forecasted trends in average weekly earnings, and (ii) the audit effort involved the use of professionals with specialized skill and knowledge.

Addressing the matter involved performing procedures and evaluating audit evidence in connection with forming our overall opinion on the consolidated financial statements.

These procedures included testing the effectiveness of controls relating to the allowance for consumer loans receivable, including controls over certain consumer loss models, and for the revolving credit portfolio, forecasted macroeconomic factors related to household disposable income and retail e-commerce sales used to estimate expected credit losses.

These procedures also included, among others (i) testing management’s process for determining the allowance for consumer loans receivable;

(ii) testing the completeness and accuracy of certain data used in the estimate;

and (iii) the involvement of professionals with specialized skill and knowledge to assist in evaluating (a) the appropriateness of certain methodologies and consumer loss models used by management and (b) for the revolving credit portfolio, the reasonableness of forecasted macroeconomic factors related to household disposable income and retail e-commerce sales.

These procedures included testing the effectiveness of controls relating to the allowance for certain consumer loans receivable, including controls over certain consumer loss models, and for the revolving credit portfolio, the macroeconomic factors related to the forecasted trends in average weekly earnings.

These procedures also included, among others (i) testing management’s process for developing the allowance for certain consumer loans receivable;

(ii) testing the completeness and accuracy of certain data used in certain consumer loss models;

and (iii) the involvement of professionals with specialized skill and knowledge to assist in evaluating (a) the appropriateness of certain consumer loss models used by management and (b) for the revolving credit portfolio, the reasonableness of macroeconomic factors related to the forecasted trends in average weekly earnings.

/s/ PricewaterhouseCoopers LLP

2 unchanged sentences

We have served as the Company’s auditor since 2000.

FY 2025 FORM 10-K

PayPal Holdings, Inc.

CONSOLIDATED BALANCE SHEETS

As of December 31,

2025 December 31,

(In millions, except par value)

37 unchanged sentences

The accompanying notes are an integral part of these consolidated financial statements.

FY 2025 FORM 10-K

PayPal Holdings, Inc.

25 unchanged sentences

The accompanying notes are an integral part of these consolidated financial statements.

FY 2025 FORM 10-K

PayPal Holdings, Inc.

6 unchanged sentences

Foreign currency translation adjustments (“CTA”) 117 ( 218 ) ( 156 )

Net investment hedges CTA gains (losses), net

122 192 ( 25 )

Tax (expense) benefit on net investment hedges CTA gains (losses), net

( 29 ) ( 44 ) 6

Unrealized gains (losses) on cash flow hedges, net

203 ( 167 ) ( 88 )

Tax (expense) benefit on unrealized gains (losses) on cash flow hedges, net

Unrealized gains (losses) on available-for-sale debt securities, net

148 457 ( 504 )

Tax (expense) benefit on foreign CTA, net

Net investment hedges CTA gains, net — 122 192

Tax expense on net investment hedges CTA gains, net — ( 29 ) ( 44 )

Unrealized (losses) gains on cash flow hedges, net ( 257 ) 203 ( 167 )

Tax benefit (expense) on unrealized (losses) gains on cash flow hedges, net 36 ( 10 ) 8

Unrealized (losses) gains on available-for-sale debt securities, net ( 1 ) 148 457

Tax (expense) benefit on unrealized gains (losses) on available-for-sale debt securities, net

3 unchanged sentences

The accompanying notes are an integral part of these consolidated financial statements.

FY 2025 FORM 10-K

PayPal Holdings, Inc.

7 unchanged sentences

Foreign CTA — — — ( 156 ) — ( 156 )

Net investment hedge CTA losses, net

Net investment hedge CTA gains, net

— — — 192 — 192

Tax benefit on net investment hedges CTA losses, net

Tax expense on net investment hedges CTA gains, net

— — — ( 44 ) — ( 44 )

Unrealized losses on cash flow hedges, net

1 unchanged sentence

Tax benefit on unrealized losses on cash flow hedges, net

Unrealized losses on available-for-sale debt securities, net

Unrealized gains on available-for-sale debt securities, net

— — — 457 — 457

Tax benefit on unrealized losses on available-for-sale debt securities, net

Tax expense on unrealized gains on available-for-sale debt securities, net

— — — ( 108 ) — ( 108 )

2 unchanged sentences

Common stock repurchased ( 74 ) ( 5,046 ) — — — ( 5,046 )

Treasury stock reissuance 1 80 — — — 80

Stock-based compensation — — 1,445 — — 1,445

2 unchanged sentences

Foreign CTA — — — ( 218 ) — ( 218 )

Tax benefit on foreign CTA — — — 14 — 14

Net investment hedge CTA gains, net

2 unchanged sentences

— — — ( 29 ) — ( 29 )

Unrealized losses on cash flow hedges, net — — — ( 167 ) — ( 167 )

Tax benefit on unrealized losses on cash flow hedges, net — — — 8 — 8

Unrealized gains on cash flow hedges, net

— — — 203 — 203

Tax expense on unrealized gains on cash flow hedges, net

— — — ( 10 ) — ( 10 )

Unrealized gains on available-for-sale debt securities, net

8 unchanged sentences

Balances at December 31, 2024 993 $ ( 27,085 ) $ 20,705 $ ( 550 ) $ 27,347 $ 20,417

Adoption of crypto asset accounting standard

— — — — 20 20

Net income — — — — 5,233 5,233

Foreign CTA — — — 117 — 117

Net investment hedges CTA gains, net — — — 122 — 122

Tax expense on net investment hedges CTA gains, net

— — — ( 29 ) — ( 29 )

Unrealized gains on cash flow hedges, net

— — — 203 — 203

Tax expense on unrealized gains on cash flow hedges, net

Tax expense on foreign CTA — — — ( 3 ) — ( 3 )

Unrealized losses on cash flow hedges, net

— — — ( 257 ) — ( 257 )

Unrealized gains on available-for-sale debt securities, net

Tax benefit on unrealized losses on cash flow hedges, net

— — — 36 — 36

Tax expense on unrealized gains on available-for-sale debt securities, net

Unrealized losses on available-for-sale debt securities, net

— — — ( 1 ) — ( 1 )

1 unchanged sentence

Common stock repurchased ( 86 ) ( 6,053 ) — — — ( 6,053 )

Treasury stock reissuance

Cash dividends declared ($ 0.14 per share)

— — — — ( 130 ) ( 130 )

2 unchanged sentences

The accompanying notes are an integral part of these consolidated financial statements.

FY 2025 FORM 10-K

PayPal Holdings, Inc.

38 unchanged sentences

Other ( 21 ) 259 86

Net cash provided by (used in) investing activities 1,589 752 ( 3,328 )

Net cash provided by investing activities 797 1,689 752

Cash flows from financing activities:

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Collateral received related to derivative instruments and reverse repurchase agreements, net ( 160 ) 156 ( 197 )

Payments of dividends to stockholders ( 130 ) — —

Other ( 6 ) ( 60 ) —

Net cash used in financing activities ( 5,958 ) ( 8,276 ) ( 2,993 )

FY 2025 FORM 10-K

PayPal Holdings, Inc.

16 unchanged sentences

The accompanying notes are an integral part of these consolidated financial statements.

FY 2025 FORM 10-K

PayPal Holdings, Inc.

5 unchanged sentences

At PayPal, our mission is to revolutionize commerce globally.

Our products are designed to enable digital payments and simplify commerce experiences for consumers and merchants to make selling, shopping, and sending and receiving money simple, personalized, secure, online or offline, including mobile.

Our two-sided platform serves millions of consumers and merchants worldwide.

We operate globally and in a rapidly evolving regulatory environment characterized by a heightened focus by regulators globally on all aspects of the payments industry, including anti-money laundering, countering terrorist financing, privacy, cybersecurity, and consumer protection.

The laws and regulations applicable to us, including those enacted prior to the advent of digital payments, continue to evolve through legislative and regulatory action and judicial interpretation.

New or changing laws and regulations, including changes to their interpretation and implementation, as well as increased penalties and enforcement actions related to non-compliance, could have a material adverse impact on our business, results of operations, and financial condition.

We monitor these areas closely and are focused on designing compliant solutions for our customers.

SIGNIFICANT ACCOUNTING POLICIES

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If we determine an investment is in a VIE, we then assess if we are the primary beneficiary, which would require consolidation.

As of December 31, 2024 and December 31, 2023, no VIEs qualified for consolidation as the structures of these entities do not provide us with the ability to direct activities that would significantly impact their economic performance.

As of December 31, 2024 and December 31, 2023, the carrying value of our investments in nonconsolidated VIEs was $ 187 million and $ 175 million, respectively, and is included as non-marketable equity securities applying the equity method of accounting in long-term investments on our consolidated balance sheets.

The investments in nonconsolidated VIEs are primarily investments in funds that are limited partnerships or similar structures which are focused on increasing access to capital for underserved communities.

Our maximum exposure to loss related to our nonconsolidated VIEs, which represents funded commitments and any future funding commitments, was $ 246 million as of both December 31, 2024 and 2023.

As of December 31, 2025 and December 31, 2024, no VIEs qualified for consolidation as the structures of these entities do not provide us with both the ability to direct activities that would significantly impact their economic performance and the obligation to absorb losses or the right to receive benefits of the VIE that could potentially be significant to the VIE.

As of December 31, 2025 and December 31, 2024, the carrying value of our investments in nonconsolidated VIEs that are primarily investments in funds that are limited partnerships or similar structures which are focused on increasing access to capital for underserved communities was $ 202 million and $ 187 million, respectively, and is included as non-marketable equity securities applying the equity method of accounting in long-term investments on our consolidated balance sheets.

Our maximum exposure to loss related to these nonconsolidated VIEs, which represents funded commitments and any future funding commitments, was $ 246 million as of both December 31, 2025 and 2024.

Certain amounts for prior years have been reclassified to conform to the financial statement presentation as of and for the year ended December 31, 2025.

PayPal Holdings, Inc.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS—(Continued)

Use of estimates

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Actual results could materially differ from these estimates.

FY 2025 FORM 10-K

PayPal Holdings, Inc.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS—(Continued)

Cash and cash equivalents

Cash and cash equivalents are short-term, highly liquid investments with original maturities of three months or less when purchased and are comprised of primarily bank deposits, government and agency securities, and commercial paper.

Cash and cash equivalents are short-term, highly liquid investments and are primarily comprised of bank deposits, PayPal USD stablecoin (“PYUSD”), money market funds and debt securities with original maturities of three months or less when purchased.

PYUSD is a stablecoin pegged to the U.S.

dollar and fully backed by U.S.

dollar deposits, U.S.

Treasuries, and similar cash equivalents.

Each token of PYUSD held by PayPal represents a contractual right to redeem with the third-party issuer of PYUSD for one U.S.

Short-term investments include time deposits and available-for-sale debt securities with original maturities of greater than three months but less than one year when purchased or maturities of one year or less on the reporting date.

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Unrealized gains and losses are reported as a component of other comprehensive income (loss), net of related estimated tax provisions or benefits.

We elect to account for available-for-sale debt securities denominated in currencies other than the functional currency of our subsidiaries, underlying funds receivable and customer accounts, short-term investments, and long-term investments, under the fair value option as further discussed in “Note 9—Fair Value Measurement of Assets and Liabilities.” The changes in fair value related to initial measurement and subsequent changes in fair value are included as a component of other income (expense), net on our consolidated statements of income (loss).

We elect to account for available-for-sale debt securities denominated in currencies other than the functional currency of our subsidiaries, underlying funds receivable and customer accounts, short-term and long-term investments, under the fair value option as further discussed in “Note 9—Fair Value Measurement of Assets and Liabilities.” The changes in fair value related to initial measurement and subsequent changes in fair value are included as a component of other income (expense), net on our consolidated statements of income (loss).

Our strategic investments consist of marketable equity securities, which are publicly traded, and non-marketable equity securities, which are primarily investments in privately held companies.

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If any impairment is identified for non-marketable equity securities or impairment is considered other-than-temporary for our equity method investments, we write down the investment to its fair value and record the corresponding charge through other income (expense), net on our consolidated statements of income (loss).

PayPal Holdings, Inc.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS—(Continued)

Our available-for-sale debt securities in an unrealized loss position are written down to fair value through a charge to other income (expense), net on our consolidated statements of income (loss) if we intend to sell the security or it is more likely than not we will be required to sell the security before recovery of its amortized cost basis.

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Any portion of impairment not related to credit losses is recognized in other comprehensive income (loss).

FY 2025 FORM 10-K

PayPal Holdings, Inc.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS—(Continued)

Accounts receivable, net

Accounts receivable is primarily related to revenue earned from customers and is reduced by an allowance for credit losses.

In estimating expected credit losses on accounts receivable, we assume that current conditions at the balance sheet date remain unchanged over the life of these short-term assets.

For the years ended December 31, 2025 and 2024, the allowance for credit losses was not significant.

1 unchanged sentence

Loans and interest receivable, held for sale

In June 2023, we entered into a multi-year agreement with a global investment firm to sell United Kingdom (“U.K.”) and other European buy now, pay later loan receivables, consisting of eligible loans and interest receivable and a forward-flow arrangement for the sale of future originations of eligible loans over a 24 -month commitment period (together, “eligible consumer installment receivables”).

In December 2024, this agreement was amended and restated to extend the commitment period to December 2026 and to increase the maximum balance of loans that can be sold at a time.

Following the sale, the global investment firm becomes the owner of the eligible consumer installment receivables sold and we no longer hold an ownership interest in these receivables.

These sales of eligible consumer installment receivables to the global investment firm are accounted for as a true sale based on our determination that these receivables met all the necessary criteria for such accounting including legal isolation for transferred assets, ability of the transferee to pledge or exchange the transferred assets without constraint, and the transfer of control, and thus, we no longer record these receivables on our consolidated financial statements.

We also concluded that our continuing involvement in the arrangement does not invalidate this determination.

We maintain the servicing rights for the entire pool of the consumer installment receivables sold and receive a market-based service fee for servicing the assets sold.

Prior to the decision to sell, this portfolio was reported at outstanding principal balances, including unamortized deferred origination costs and estimated collectible interest and fees, net of allowances for credit losses.

At the time of reclassification of eligible consumer installment receivables to loans and interest receivable, held for sale in May 2023, any previously recorded allowance for credit losses for loans and interest receivable outstanding was reversed, resulting in a decrease in transaction and credit losses on our consolidated statements of income (loss) for the year ended December 31, 2023.

Loans and interest receivable, held for sale as of December 31, 2024 and 2023 represents installment consumer receivables that we originated and intend to sell to the global investment firm.

Loans and interest receivable, held for sale are recorded at the lower of cost or fair value, determined on an aggregate basis, with valuation changes and any associated charge-offs recorded in restructuring and other on our consolidated statements of income (loss).

When PayPal has the intent to sell loans to third-party investors they are classified as loans and interest receivable, held for sale on our consolidated balance sheets and reported at the lower of cost or fair value, determined on an aggregate basis, with valuation changes and any associated charge-offs recorded in restructuring and other on our consolidated statements of income (loss).

Interest income on interest bearing held-for-sale loans is accrued and recognized based on the contractual rate of interest.

If PayPal no longer intends to sell loans and interest receivable, held for sale, such loans would be reclassified to loans and interest receivable, held for investment.

When a loan is reclassified to held for investment, any amounts previously recorded in order to measure the loan at the lower of cost or fair value are reversed on our consolidated statements of income (loss) (recognized within restructuring and other) and the loan is recorded consistent with loans held for investment.

Once PayPal makes the decision to sell loans classified as held for investment, they are reclassified from loans and interest receivable, net to loans and interest receivable, held for sale.

When loans are reclassified to held for sale, any previously recorded allowance for credit losses is reversed, resulting in a decrease in transaction and credit losses on our consolidated statements of income (loss).

The loan is then recorded consistent with loans held for sale.

Sales of loan receivables to third-party investors are accounted for as a true sale based on our determination that these receivables met all the necessary criteria for such accounting including legal isolation for transferred assets, ability of the transferee to pledge or exchange the transferred assets without constraint, and the transfer of control, and thus, we no longer record these receivables on our consolidated financial statements.

We also conclude that our continuing involvement in the arrangement does not invalidate this determination.

We retain the servicing rights on loans that are sold to third-party investors and we receive a market-based servicing fee for servicing the sold loans.

Loans and interest receivable, net

Loans and interest receivable, net represents consumer loans originated under our revolving credit products (PayPal Credit) and installment credit products and merchant receivables originated under our PayPal Working Capital (“PPWC”) product and PayPal Business Loan (“PPBL”) product.

PayPal Holdings, Inc.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS—(Continued)

In the U.S., consumer interest-bearing installment products, PPWC, and PPBL are provided under a program agreement we have with an independent chartered financial institution (“partner institution”).

When PayPal has the intent and ability to hold loans for the foreseeable future or until maturity or payoff they are classified as loans and interest receivable, net on our consolidated balance sheets and are reported at their outstanding balances, net of any participation interests sold, unamortized deferred origination fees and costs, and allowance for expected credit losses.

Loans and interest receivable, net represents consumer loans originated under our revolving credit products (PayPal Credit) and our installment credit products (which we also refer to as our buy now, pay later (“BNPL”) products), and merchant receivables originated under our PayPal Working Capital (“PPWC”) product and PayPal Business Loan (“PPBL”) product.

In the U.S., our consumer interest-bearing installment products, PPWC, and PPBL are provided under a program agreement we have with an independent chartered financial institution (“partner institution”).

The partner institution extends credit to consumers for interest-bearing installment products and to merchants for the PPWC and PPBL products, and we purchase the related receivables originated by the partner institution.

11 unchanged sentences

For this arrangement, gains or losses on the sale of the participation interests are not material as the carrying amount of the participation interest sold approximates the fair value at time of transfer.

Loans, advances, and interest and fees receivable are reported at their outstanding balances, net of any participation interests sold and unamortized deferred origination costs.

We maintain the servicing rights for the entire pool of consumer and merchant receivables outstanding and receive a market-based service fee for servicing the assets underlying the participation interest sold.

We offer both revolving and installment credit products to our consumers.

We retain the servicing rights for the entire pool of consumer receivables outstanding and receive a market-based service fee for servicing the assets underlying the participation interest sold.

FY 2025 FORM 10-K

PayPal Holdings, Inc.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS—(Continued)

The terms of our consumer relationships require us to submit monthly bills to the consumer detailing loan repayment requirements.

1 unchanged sentence

Due to the relatively small dollar amount of individual loans and interest receivable, we do not require collateral on these balances.

In certain instances where a merchant is able to demonstrate that it is experiencing financial difficulty, there may be a modification of the loan or advance and the related interest or fee receivable for which it is probable that, without modification, we would be unable to collect all amounts due.

Another partner institution is the exclusive issuer of the PayPal Credit consumer financing program in the U.S.

In certain instances where a merchant is able to demonstrate that it is experiencing financial difficulty, there may be a modification of the loan or advance and the related fee receivable for which it is probable that, without modification, we would be unable to collect all amounts due.

Another partner institution is the exclusive issuer of the PayPal Credit consumer financing program in the U.S., which also includes PayPal and Venmo branded credit cards.

We do not hold an ownership interest in the receivables generated through the program and therefore, do not record these receivables on our consolidated financial statements.

PayPal earns a revenue share on the portfolio of consumer receivables owned by the partner institution, which is recorded in revenues from other value added services on our consolidated statements of income (loss).

If PayPal no longer intends to sell loans and interest receivable, held for sale, such loans would be reclassified to loans and interest receivable, net.

When a loan is reclassified as held for investment, any amounts previously recorded in order to measure the loan at the lower of cost or fair value are reversed within restructuring and other on our consolidated statements of income (loss) and the loan is recorded consistent with loans held for investment.

Allowance for loans and interest receivable

3 unchanged sentences

The evaluation process to assess the adequacy of allowances is subject to numerous estimates and judgments.

PayPal Holdings, Inc.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS—(Continued)

The allowance for consumer loans and interest receivable not classified as held for sale is primarily based on expectations of credit losses based on historical lifetime loss data and incorporates macroeconomic forecasts applied to the portfolio.

The forecasted macroeconomic factors are sourced externally, using a single scenario that we believe is most appropriate to the economic conditions applicable to a particular period.

The allowance for consumer loans and interest receivable is primarily based on expectations of credit losses using historical lifetime loss data and incorporates macroeconomic forecasts applied to the portfolio.

The consumer loss models incorporate various portfolio attributes including geographic region, loan term, delinquency, credit rating, vintage, and for the revolving credit portfolio, macroeconomic factors such as forecasted trends in average weekly earnings starting in the second quarter of 2025 and utilizing household disposable income and retail e-commerce sales through the first quarter of 2025.

The forecasted macroeconomic factors are sourced externally, using probability weighted multiple economic scenarios for most consumer loan portfolios starting in the second quarter of 2025 (and through the first quarter of 2025 a single scenario), that we believe are most appropriate to the economic conditions applicable to a particular period.

The change to multiple macroeconomic scenarios did not have a material impact on the provision for the year ended December 31, 2025.

For both 2025 and 2024, the reasonable and supportable forecast period for revolving products and installment products (not classified as held for sale) that we have included in our projected loss rates, which approximates the estimated life of the loans, was approximately 5 years and 7 months to 3.5 years, respectively.

Projected loss rates (inclusive of historical loss data and for the revolving credit portfolio, macroeconomic factors) are derived based on and applied to the principal amount of our consumer receivables.

We also include qualitative adjustments that incorporate incremental information not captured in the quantitative estimates of our current expected credit losses, such as expectations of macroeconomic conditions not captured in the loss models for our installment products (not classified as held for sale).

Projected loss rates (inclusive of historical loss data and for the revolving credit portfolio, macroeconomic factors) are applied to the principal amount of our consumer receivables.

The allowance for current expected credit losses on interest and fees receivable is determined primarily by applying loss curves to each portfolio by geography, delinquency, and period of origination, among other factors.

3 unchanged sentences

Loans receivable continue to accrue interest until they are charged off.

In connection with the sale of our eligible consumer installment receivables and the reclassification of that portfolio as held for sale in 2023, we reversed the previously recorded allowances for credit losses associated with those loans and interest receivable balances.

Charge-offs and any adjustments to the fair value of loans and interest receivable, held for sale, are recorded in restructuring and other on our consolidated statement of income (loss).

The allowance for merchant loans, advances, and interest and fees receivable is primarily based on expectations of credit losses based on historical lifetime loss data as well as macroeconomic forecasts applied to the portfolio.

In the third quarter of 2024, we updated our expected credit loss model for our PPWC portfolio to reflect its current risk characteristics.

These changes did not have a material impact on our provision recorded in the year ended December 31, 2024.

FY 2025 FORM 10-K

PayPal Holdings, Inc.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS—(Continued)

The allowance for merchant loans, advances, and fees receivable is primarily based on expectations of credit losses using historical lifetime loss data as well as macroeconomic forecasts applied to the portfolio.

The merchant loss models incorporate various portfolio attributes including geographic region, first borrowing versus repeat borrowing, delinquency, internally developed risk ratings, and vintage, as well as macroeconomic factors such as forecasted trends in unemployment rates and retail e-commerce sales.

The forecasted macroeconomic factors are sourced externally, using a single scenario that we believe is most appropriate to the economic conditions applicable to a particular period.

The forecasted macroeconomic factors are sourced externally, using probability weighted multiple economic scenarios starting in the second quarter of 2025 (and through the first quarter of 2025, a single scenario) that we believe are most appropriate to the economic conditions applicable to a particular period.

The change to multiple macroeconomic scenarios did not have a material impact on the provision for the year ended December 31, 2025.

The reasonable and supportable forecast period for merchant products that we have included in our projected loss rates for 2025 and 2024, which approximates the estimated life of the loans, was approximately 2.5 to 3.5 years.

Projected loss rates, inclusive of historical loss data and macroeconomic factors, are derived based on and applied to the principal amount of our merchant receivables.

Projected loss rates, inclusive of historical loss data and macroeconomic factors, are applied to the principal amount of our merchant receivables.

We also include qualitative adjustments that incorporate incremental information not captured in the quantitative estimates of our current expected credit losses.

For merchant loans and advances, the determination of delinquency is based on the current expected or contractual repayment period of the loan or advance and fixed interest or fee payment as compared to the original expected or contractual repayment period.

The allowance for current expected credit losses on fees receivable is determined primarily by applying loss curves to each portfolio by geography, delinquency, and period of origination, among other factors.

For merchant loans and advances, the determination of delinquency is based on the current expected or contractual repayment period of the loan or advance and fixed fee payment as compared to the original expected or contractual repayment period.

We charge off the receivables outstanding under our PPBL product when the repayments are 180 days past the contractual repayment date.

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Charge-offs are recorded as a reduction to our allowance for loans and interest receivable and subsequent recoveries, if any, are recorded as an increase to the allowance for loans and interest receivable.

PayPal Holdings, Inc.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS—(Continued)

Customer accounts

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We classify the assets underlying the customer balances as current based on their purpose and availability to fulfill our direct obligation under amounts due to customers.

Customer funds for which PayPal is an agent and custodian on behalf of our customers are not reflected on our consolidated balance sheets.

Customer funds for which PayPal does not have a present right to obtain the related economic benefits or restrict others’ access to those benefits are not reflected on our consolidated balance sheets.

These funds include U.S.

dollar funds which are deposited at one or more third-party financial institutions insured by the Federal Deposit Insurance Corporation (“FDIC”) and are eligible for FDIC pass-through insurance (subject to applicable limits).

The Luxembourg Commission de Surveillance du Secteur Financier (the “CSSF”) has agreed that PayPal’s management may designate up to 50 % of European customer balances held in our Luxembourg banking subsidiary to fund European, U.K., and U.S.

credit activities.

As of December 31, 2024 and 2023, the cumulative amount approved by PayPal to be designated to fund credit activities was $ 2.0 billion and $ 3.0 billion, respectively, and represented approximately 26 % and 39 % of European customer balances made available for our corporate use as of those respective dates, as determined by applying financial regulations maintained by the CSSF.

As of December 31, 2025 and 2024, the cumulative amount approved by PayPal to be designated to fund credit activities was $ 2.0 billion as of those respective dates and represented approximately 26 % of European customer balances made available for our corporate use as of those respective dates, as determined by applying financial regulations maintained by the CSSF.

At the time PayPal’s management designates the European customer balances held in our Luxembourg banking subsidiary to be used to extend credit, the balances are classified as cash and cash equivalents and no longer classified as customer accounts on our consolidated balance sheets.

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See “Note 8—Cash and Cash Equivalents, Funds Receivable and Customer Accounts, and Investments” for additional information related to customer accounts.

Under applicable accounting standards, we are an agent when facilitating cryptocurrency transactions on behalf of our customers.

Cryptocurrencies held on behalf of our customers are not PayPal’s assets and therefore, are not reflected as cryptocurrency assets on our consolidated balance sheets;

however, we recognize a crypto asset safeguarding liability with a corresponding safeguarding asset to reflect our obligation to safeguard the cryptocurrencies held on behalf of our customers.

Customer-owned cryptocurrency assets are not recorded on our consolidated balance sheets because we do not have a present right to obtain the related economic benefits or restrict others' access to those benefits.

Accordingly, the assets remain the property of our customers.

FY 2025 FORM 10-K

PayPal Holdings, Inc.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS—(Continued)

Funds receivable and funds payable

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generally, one to five years for computer equipment and software, including capitalized software and website development costs, three years for furniture and fixtures, up to 30 years for buildings and building improvements, and the shorter of five years or the non-cancelable term of the lease for leasehold improvements.

PayPal Holdings, Inc.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS—(Continued)

Direct costs incurred to develop software for internal use and website development costs, including those costs incurred in expanding and enhancing our payments platform, are capitalized and amortized generally over an estimated useful life of three years and are recorded as amortization within the financial statement captions aligned with the internal organizations that are the primary beneficiaries of such assets.

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Lease expense for finance leases is amortized on a straight-line basis over the lease term, and interest expense for finance lease liabilities is recognized based on the implicit rate or the incremental borrowing rate.

FY 2025 FORM 10-K

PayPal Holdings, Inc.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS—(Continued)

We have lease agreements with lease and non-lease components.

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If the evaluation indicates that the carrying amount of the ROU assets may not be recoverable, any potential impairment is measured based upon the fair value of the related ROU asset or asset group as determined by appropriate valuation techniques.

PayPal Holdings, Inc.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS—(Continued)

Goodwill and intangible assets

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Allowance for transaction losses

We are exposed to transaction losses due to credit card and other payment misuse as well as nonperformance from sellers who accept payments through PayPal.

We establish an allowance for estimated losses arising from completing customer transactions, such as chargebacks for unauthorized credit card use and merchant-related chargebacks due to non-delivery or unsatisfactory delivery of purchased items, purchase protection program claims, and account takeovers.

We are exposed to transaction losses due to credit card and other payment misuse as well as non-performance from sellers who accept payments through PayPal.

We establish an allowance for estimated losses arising from completing customer transactions, such as chargebacks for unauthorized credit card use and merchant-related chargebacks due to non-delivery or unsatisfactory delivery of eligible purchased items, purchase protection program claims, and account takeovers.

This allowance represents an accumulation of the estimated amounts of probable transaction losses as of the reporting date.

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The allowance for transaction losses is included in accrued expenses and other current liabilities on our consolidated balance sheets.

FY 2025 FORM 10-K

PayPal Holdings, Inc.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS—(Continued)

Allowance for negative customer balances

Negative customer balances occur primarily when there are insufficient funds in a customer’s PayPal account to cover charges applied for bank returns and reversals, debit card transactions, and merchant-related chargebacks due to non-delivery or unsatisfactory delivery of purchased items, which are generally within the scope of our protection programs.

Negative customer balances occur primarily when there are insufficient funds in a customer’s PayPal account to cover charges applied for bank returns and reversals, debit card transactions, and merchant-related chargebacks due to non-delivery or unsatisfactory delivery of eligible purchased items, which are generally within the scope of our protection programs.

Negative customer balances can be cured by the customer by adding funds to their account, receiving payments, or through back-up funding sources.

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For negative customer balances that are not expected to be cured or otherwise collected, we provide an allowance for expected losses.

The allowance represents expected losses based on historical trends involving collection and write-off patterns, internal factors including our experience with similar cases, other known facts and circumstances, and reasonable and supportable macroeconomic forecasts, as appropriate.

The allowance represents expected losses based on historical trends involving collection and write-off patterns, internal factors including our experience with similar cases, other known facts and circumstances, and current conditions at the balance sheet date, which are assumed to remain unchanged over the life of these short-term assets.

Loss rates are derived using historical loss data for each delinquency bucket using a roll rate model that captures the losses and the likelihood that a negative customer balance will be written off as the delinquency age of such balance increases.

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Adjustments to the allowance for negative customer balances are recorded as a component of transaction and credit losses on our consolidated statements of income (loss).

PayPal Holdings, Inc.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS—(Continued)

Derivative instruments

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See “Note 9—Fair Value Measurement of Assets and Liabilities” for additional information related to our fair value measurements.

Crypto asset safeguarding liability and corresponding safeguarding asset

See “Note 7—Other Financial Statement Details” for information related to our crypto asset safeguarding liability and corresponding safeguarding asset.

FY 2025 FORM 10-K

PayPal Holdings, Inc.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS—(Continued)

Concentrations of risk

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and internationally, when we draw funds from a customer’s credit or debit card, bank account, or other funding source they have stored in their digital wallet.

As of December 31, 2024 and 2023, one partner institution accounted for 14 % and 15 % of net accounts receivables, respectively.

As of December 31, 2025, one customer and one partner institution accounted for 12 % and 23 % of net accounts receivable, respectively.

As of December 31, 2024, one partner institution accounted for 14 % of net accounts receivable.

The same partner institution accounted for our long-term notes receivable and contract asset balance, which represented 18 % and 17 % of other assets at December 31, 2025 and 2024, respectively.

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During the years ended December 31, 2025, 2024, and 2023, no customer accounted for more than 10% of net revenues.

During the year ended December 31, 2024, two payment processors accounted for 48 % of transaction expense.

During the years ended December 31, 2023 and 2022, one payment processor accounted for 60 % and 63 % of transaction expense, respectively.

PayPal Holdings, Inc.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS—(Continued)

During the years ended December 31, 2025 and 2024, two payment processors accounted for 56 % and 48 % of transaction expense, respectively.

During the year ended December 31, 2023, one payment processor accounted for 60 % of transaction expense.

Revenue recognition

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We determine compensation expense associated with restricted stock units, performance based restricted stock units, and restricted stock awards based on the estimated fair value of our common stock on the date of grant.

We determine compensation expense associated with stock options based on the estimated grant date fair value method using the Black-Scholes valuation model.

We generally recognize compensation expense using a straight-line amortization method over the respective vesting period for awards that are ultimately expected to vest.

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When estimating forfeitures, we consider voluntary termination behavior of our employees as well as trends of actual forfeitures.

FY 2025 FORM 10-K

PayPal Holdings, Inc.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS—(Continued)

Foreign currency

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We recognize interest and penalties, if any, related to unrecognized tax benefits in income tax expense.

We account for Global Intangible Low-Taxed Income as a current-period expense when incurred.

PayPal Holdings, Inc.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS—(Continued)

We account for Global Intangible Low-Taxed Income, renamed as the Net Controlled Foreign Corporation Tested Income under the One Big Beautiful Bill Act, as a current-period expense when incurred.

Other income (expense), net

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• interest income, which consists of interest earned on corporate cash and cash equivalents and short-term and long-term investments,

• interest expense, which consists of interest expense, fees, and amortization of debt discount on our long-term debt (including current portion) and credit facilities,

• interest expense, which consists of interest expense, fees, and amortization of debt discount on our long-term debt (including current portion), credit facilities, and commercial paper,

• realized and unrealized gains (losses) on strategic investments, and

• other, which primarily includes foreign exchange gains and losses due to remeasurement of certain foreign currency denominated monetary assets and liabilities, forward points on derivative contracts designated as net investment hedges, and fair value changes on the derivative contracts not designated as hedging instruments.

Recent accounting guidance

In December 2023, the Financial Accounting Standards Board (“FASB”) issued Accounting Standards Update (“ASU”) 2023-08, Intangibles – Goodwill and Other – Crypto Assets (Subtopic 350-60):

• other, which primarily includes foreign exchange gains and losses due to remeasurement of certain foreign currency denominated monetary assets and liabilities, forward points on derivative contracts designated as net investment hedges, fair value changes on the derivative contracts not designated as hedging instruments and realized and unrealized gains (losses) on crypto assets held for investment.

Recently issued accounting guidance

In November 2024, the Financial Accounting Standards Board (“FASB”) issued Accounting Standards Update (“ASU”) 2024-03, Income Statement – Reporting Comprehensive Income – Expense Disaggregation Disclosures (Subtopic 220-40):

Disaggregation of Income Statement Expenses .

The amended guidance requires disaggregation of certain expense captions into specified natural expense categories in the disclosures within the notes to the financial statements.

In addition, the guidance requires disclosure of selling expenses and its definition.

The new guidance is effective for annual periods beginning after December 15, 2026, and interim reporting periods within annual reporting periods beginning after December 15, 2027, with early adoption permitted.

The guidance can be applied either prospectively or retrospectively.

We are evaluating the impact this amended guidance may have on the notes to our consolidated financial statements.

In September 2025, the FASB issued ASU 2025-06, Intangibles – Goodwill and Other – Internal-Use Software (Subtopic 350-40):

Targeted Improvements to the Accounting for Internal-Use Software.

The amended guidance modernizes the accounting for costs related to internal-use software to more closely align with current software development methods.

The guidance removes references to project stages and clarifies when we are required to start capitalizing eligible costs.

The new guidance is effective for fiscal years beginning after December 15, 2027, and interim periods within those fiscal years, with early adoption permitted.

The guidance can be applied on a prospective basis, a modified basis for in-process projects, or a retrospective basis.

We are evaluating the impact this amended guidance may have on our consolidated financial statements.

FY 2025 FORM 10-K

PayPal Holdings, Inc.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS—(Continued)

Recently adopted accounting guidance

In December 2023, the FASB issued ASU 2023-08, Intangibles – Goodwill and Other – Crypto Assets (Subtopic 350-60):

Accounting for and Disclosure of Crypto Assets .

This amended guidance requires fair value measurement of certain crypto assets each reporting period, with the changes in fair value reflected in net income.

The amendments also require disclosures of the name, fair value, units held, and cost bases for each significant crypto asset held and annual reconciliations of crypto asset holdings.

The amendments also require disclosures of the name, fair value, units held, and cost basis for each significant crypto asset held and annual reconciliations of crypto asset holdings.

The new guidance is effective for fiscal years, and interim periods within those fiscal years, beginning after December 15, 2024.

We adopted this guidance effective January 1, 2025.

We adopted this guidance effective as of January 1, 2025.

We have applied the amendments of this guidance as a cumulative-effect adjustment to retained earnings.

The adoption of this guidance did not have a significant impact.

The adoption of this guidance did not have a significant impact on our consolidated financial statements.

In December 2023, the FASB issued ASU 2023-09, Income Taxes (Topic 740):

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The amended guidance enhances income tax disclosures primarily related to the effective tax rate reconciliation and income taxes paid information.

This guidance requires disclosure of specific categories in the effective tax rate reconciliation and further information on reconciling items meeting a quantitative threshold.

This guidance requires disclosure of specific categories in the effective tax rate reconciliation and additional information on reconciling items meeting a quantitative threshold.

In addition, the amended guidance requires disaggregating income taxes paid (net of refunds received) by federal, state, and foreign taxes.

It also requires disaggregating individual jurisdictions in which income taxes paid (net of refunds received) is equal to or greater than 5 percent of total income taxes paid (net of refunds received).

It also requires disaggregating individual jurisdictions in which income taxes paid (net of refunds received) are equal to or greater than 5 percent of total income taxes paid (net of refunds received).

The amended guidance is effective for annual periods beginning after December 15, 2024.

The guidance can be applied either prospectively or retrospectively.

We are evaluating the impact this amended guidance may have on the notes to our consolidated financial statements.

In November 2024, the FASB issued ASU 2024-03, Income Statement – Reporting Comprehensive Income – Expense Disaggregation Disclosures (Subtopic 220-40):

Disaggregation of Income Statement Expenses .

The amended guidance requires disaggregation of certain expense captions into specified natural expense categories in the disclosures within the notes to the financial statements.

In addition, the guidance requires disclosure of selling expenses and its definition.

The new guidance is effective for fiscal years beginning after December 15, 2026, and interim reporting periods beginning after December 15, 2027, with early adoption permitted.

The guidance can be applied either prospectively or retrospectively.

We are evaluating the impact this amended guidance may have on the notes to our consolidated financial statements.

In January 2025, the SEC released Staff Accounting Bulletin No.

122 (“SAB 122”) rescinding SAB 121, which required an entity to record a liability to reflect its obligation to safeguard the crypto assets held for its platform users with a corresponding asset and required disclosures related to the entity’s safeguarding obligations.

SAB 122 is effective for annual periods beginning after December 15, 2024 and is required to be applied on a fully retrospective basis, with early adoption permitted.

Upon adoption we will no longer recognize the crypto asset safeguarding liability and corresponding safeguarding asset on our consolidated financial statements.

PayPal Holdings, Inc.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS—(Continued)

Recently adopted accounting guidance

In November 2023, the FASB issued ASU 2023-07, Segment Reporting (Topic 280):

Improvements to Reportable Segment Disclosures .

The amended guidance requires incremental reportable segment disclosures, primarily about significant segment expenses.

The amendments also require entities with a single reportable segment to provide all disclosures required by these amendments, and all existing segment disclosures.

The amendments will be applied retrospectively to all prior periods presented in the financial statements and is effective for fiscal years beginning after December 15, 2023, and interim periods in fiscal years beginning after December 15, 2024, with early adoption permitted.

We adopted this guidance in the fourth quarter of 2024.

For additional information, see “Note 18—Segment Information.”

We adopted this guidance prospectively for the annual period ending December 31, 2025.

For additional information, see “Note 16 — Income Taxes.”

In January 2025, the SEC released Staff Accounting Bulletin (“SAB”) No.

122 rescinding SAB No.

121, which required an entity to record a liability to reflect its obligation to safeguard the crypto assets held for its platform users with a corresponding asset and required disclosures related to the entity’s safeguarding obligations.

122 is effective for annual periods beginning after December 15, 2024 and is required to be applied on a fully retrospective basis, with early adoption permitted.

We adopted this guidance as of March 31, 2025 and derecognized the crypto asset safeguarding liability and corresponding safeguarding asset on our consolidated balance sheet as of December 31, 2024.

Additionally, we derecognized the associated deferred tax asset and liability as of December 31, 2024.

The adoption of this guidance did not impact our consolidated statements of income (loss), comprehensive income (loss), stockholders’ equity, or cash flows.

The following table presents the effects of the changes on the presentation of our consolidated balance sheet:

December 31, 2024

(In millions)

As Previously Reported (1)

Adjustments As Adjusted

Total assets (2)

$ 81,611 $ ( 2,886 ) $ 78,725

Total liabilities (2)

$ 61,194 $ ( 2,886 ) $ 58,308

(1) As reported in our 2024 Form 10-K filed with the SEC on February 4, 2025.

(2) Financial statement lines impacted within total assets and total liabilities were “prepaid expenses and other current assets” and “accrued expenses and other current liabilities”, respectively.

There are other new accounting pronouncements issued by the FASB that we have adopted or will adopt, as applicable.

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transaction revenues and revenues from other value added services.

FY 2025 FORM 10-K

PayPal Holdings, Inc.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS—(Continued)

TRANSACTION REVENUES

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We generate additional revenues from merchants and consumers:

on transactions where we perform currency conversion, when we enable cross-border transactions (i.e., transactions where the merchant and consumer are in different countries), to facilitate the instant transfer of funds for our customers from their PayPal or Venmo account to their bank account or debit card, to facilitate the purchase and sale of cryptocurrencies, as contractual compensation from sellers that violate our contractual terms (for example, through fraud or counterfeiting), and other miscellaneous fees.

on transactions where we perform currency conversion, when we enable cross-border transactions (i.e., transactions where the merchant and consumer are in different countries), when we facilitate the instant transfer of funds for our customers from their PayPal or Venmo account to their bank account or debit card, when we facilitate the purchase and sale of cryptocurrencies, as contractual compensation from sellers that violate our contractual terms (for example, through fraud or counterfeiting), and other miscellaneous fees.

Our transaction revenues are also reduced by certain incentives provided to our customers.

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We are also responsible for providing customer support.

PayPal Holdings, Inc.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS—(Continued)

To promote engagement and acquire new users on our platform, we may provide incentives to merchants and consumers in various forms including discounts on fees, rebates, rewards, and coupons.

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These protection programs do not provide a separate service to our customers and we estimate and record associated costs in transaction and credit losses during the period the payment transaction is completed.

FY 2025 FORM 10-K

PayPal Holdings, Inc.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS—(Continued)

REVENUES FROM OTHER VALUE ADDED SERVICES

We earn revenues from other value added services, which are comprised primarily of revenue earned through partnerships, referral fees, subscription fees, gateway fees, and other services that we provide to our consumers and merchants.

We earn revenues from other value added services, which are comprised of revenue earned through partnerships, referral fees, subscription fees, gateway fees, and other services that we provide to our consumers and merchants.

These contracts typically have one performance obligation which is provided and recognized over the term of the contract.

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(1) No single country included in the other countries category generated more than 10% of total net revenues.

(2) Total net revenues include $ 2.1 billion, $ 1.8 billion, and $ 1.3 billion for the years ended December 31, 2024, 2023, and 2022, respectively, which do not represent revenues recognized in the scope of Accounting Standards Codification Topic 606, Revenue from contracts with customers.

Such revenues relate to

PayPal Holdings, Inc.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS—(Continued)

interest and fees earned on loans and interest receivable, including loans and interest receivable held for sale, as well as hedging gains or losses, and interest earned on certain assets underlying customer balances.

(2) Total net revenues include $ 2.1 billion for both the years ended December 31, 2025 and 2024 and $ 1.8 billion for the year ended December 31, 2023, which do not represent revenues recognized in the scope of Accounting Standards Codification Topic 606, Revenue from contracts with customers.

Such revenues relate to interest and fees earned on loans and interest receivable, including loans and interest receivable held for sale, hedging gains or losses, and interest earned and gains or losses on certain assets underlying customer balances.

Net revenues are attributed to the country in which the party paying our fee is located.

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During periods when we report net loss, diluted net loss per share is the same as basic net loss per share because the effects of potentially dilutive items would decrease the net loss per share.

FY 2025 FORM 10-K

PayPal Holdings, Inc.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS—(Continued)

The following table sets forth the computation of basic and diluted net income (loss) per share for the periods indicated:

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NOTE 4— BUSINESS COMBINATIONS AND DIVESTITURES

In the second quarter of 2025, we completed an acquisition with a total purchase price of $ 19 million, consisting of cash consideration, which was accounted for as a business combination.

There were no acquisitions accounted for as business combinations completed in 2024 or 2023.

There were no divestitures completed in 2024 or 2022.

DIVESTITURES COMPLETED IN 2023

On November 1, 2023, we completed the sale of Happy Returns to United Parcel Services, Inc.

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A pre-tax gain of $ 339 million, net of transaction costs, was included in restructuring and other in the consolidated statements of income (loss) for the year ended December 31, 2023.

There were no divestitures completed in 2025 or 2024.

NOTE 5— GOODWILL AND INTANGIBLE ASSETS

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Total goodwill $ 11,026 $ — $ ( 189 ) $ 10,837 $ 7 $ 20 $ 10,864

The adjustments to goodwill during 2025 and 2024 pertained to foreign currency translation adjustments.

FY 2025 FORM 10-K

PayPal Holdings, Inc.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS—(Continued)

The adjustments to goodwill during 2024 pertained to foreign currency translation adjustments.

The adjustments to goodwill during 2023 pertained to foreign currency translation adjustments and a reduction in goodwill associated with the divestiture of Happy Returns.

For additional information, see “Note 4—Business Combinations and Divestitures.”

INTANGIBLE ASSETS

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Amortization Net

(In millions, except years)

(In millions)

Intangible assets (1) :

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(1) Excludes intangible assets which have been fully amortized, but are still in use.

In the year ended December 31, 2023, we recorded a reduction of approximately $ 36 million of gross intangible assets, with a net carrying amount of $ 13 million, associated with the divestiture of Happy Returns as described in “Note 4—Business Combinations and Divestitures.” In the year ended December 31, 2023, we retired approximately $ 141 million of fully amortized intangible assets, consisting primarily of $ 79 million in customer lists and user base and $ 62 million in developed technology.

Amortization expense for intangible assets was $ 175 million, $ 207 million, and $ 226 million for the years ended December 31, 2025, 2024, and 2023, respectively.

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A sublease situation can arise when currently leased real estate space is available and is surplus to operational requirements.

PayPal Holdings, Inc.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS—(Continued)

The components of lease expense were as follows:

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Operating lease expense $ 162 $ 159 $ 156

Finance lease expense

Amortization of ROU lease assets

Total finance lease expense 8 — —

Finance lease expense - amortization of ROU lease assets

Sublease income ( 8 ) ( 12 ) ( 9 )

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$ 170 $ 155 $ 147

FY 2025 FORM 10-K

PayPal Holdings, Inc.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS—(Continued)

Supplemental cash flow information related to leases was as follows:

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(1) ROU lease asset impairment

Refer to “Note 17—Restructuring and Other” for further details.

Supplemental balance sheet information related to leases was as follows:

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Total lease liabilities $ 696 $ 17 $ 764 $ 23

Weighted-average remaining lease term 5.9 years 4.4 years 5.0 years —

Weighted-average remaining lease term 5.4 years 3.4 years 5.9 years 4.4 years

Weighted-average discount rate 4 % 5 % 4 % 5 %

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Lease liability $ 696 $ 17

PayPal Holdings, Inc.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS—(Continued)

Operating lease amounts include minimum lease payments under our non-cancelable operating leases primarily for office and data center facilities.

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We recognize rent expense under such agreements on a straight-line basis.

NOTE 7— OTHER FINANCIAL STATEMENT DETAILS

CRYPTO ASSET SAFEGUARDING LIABILITY AND CORRESPONDING SAFEGUARDING ASSET

We allow our customers in certain markets to buy, hold, sell, convert, receive, and send certain cryptocurrencies as well as use the proceeds from sales of cryptocurrencies to pay for purchases at checkout.

These cryptocurrencies consist of Bitcoin, Ethereum, Litecoin, Bitcoin Cash, and PayPal USD stablecoin (collectively, “our customers’ crypto assets”).

We engage third parties, which are licensed trust companies, to provide certain custodial services, including holding our customers’ cryptographic key information, securing our customers’ crypto assets, and protecting them from loss or theft, including indemnification against certain types of losses such as theft.

Our third-party custodians hold the crypto assets in a custodial account in PayPal’s name for the benefit of PayPal’s customers.

We maintain the internal recordkeeping of our customers’ crypto assets, including the amount and type of crypto asset owned by each of our customers in that custodial account.

As of December 31, 2024, we utilize two third-party custodians;

as such, there is concentration risk in the event these custodians are not able to perform in accordance with our agreements.

Due to the unique risks associated with cryptocurrencies, including technological, legal, and regulatory risks, we recognize a crypto asset safeguarding liability to reflect our obligation to safeguard the crypto assets held for the benefit of our customers, which is recorded in accrued expenses and other current liabilities on our consolidated balance sheets.

We also recognize a corresponding safeguarding asset which is recorded in prepaid expenses and other current assets on our consolidated balance sheets.

The crypto asset safeguarding liability and corresponding safeguarding asset are measured and recorded at fair value on a recurring basis using quoted prices for the underlying crypto assets on the active exchange that we have identified as the principal market at the balance sheet date.

The corresponding safeguarding asset may be adjusted for loss events, as applicable.

As of December 31, 2024 and 2023, the Company had not incurred any safeguarding loss events, and therefore, the crypto asset safeguarding liability and corresponding safeguarding asset were recorded at the same value.

The following table summarizes the significant crypto assets we hold for the benefit of our customers and the crypto asset safeguarding liability and corresponding safeguarding asset as of December 31, 2024 and 2023:

As of December 31,

(In millions)

Bitcoin $ 2,030 $ 741

Ethereum 731 412

Crypto asset safeguarding liability $ 2,886 $ 1,241

Crypto asset safeguarding asset $ 2,886 $ 1,241

As of December 31, 2025, we have an additional operating lease for an office, which will commence in the first quarter of 2026 or later with minimum lease payments aggregating to $ 284 million and a lease term of twelve years .

As of December 31, 2025, we did no t have any additional finance leases which have not yet commenced.

FY 2025 FORM 10-K

PayPal Holdings, Inc.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS—(Continued)

NOTE 7— OTHER FINANCIAL STATEMENT DETAILS

PROPERTY AND EQUIPMENT, NET

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Total property and equipment, net $ 1,700 $ 1,508

Depreciation and amortization expense was $ 825 million in 2024 and $ 846 million for both 2023 and 2022.

Net changes in accounts payable on our consolidated statements of cash flows includes non-cash investing activities associated with property and equipment;

the impact of which was an increase of $ 14 million and $ 7 million in 2024 and 2023, respectively, and a decrease of $ 36 million in 2022.

Depreciation and amortization expense was $ 788 million, $ 825 million and $ 846 million in 2025, 2024 and 2023, respectively.

Supplemental cash flow information related to property and equipment

Non-cash investing transactions that are not reflected in the consolidated statements of cash flows for the years ended December 31, 2025, 2024, and 2023 include property and equipment acquired through increases in accounts payable of $ 9 million, $ 14 million and $ 7 million, respectively.

Geographical information

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and other countries are based upon the country in which the asset is located or owned.

FY 2025 FORM 10-K

PayPal Holdings, Inc.

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The following table summarizes the changes in accumulated balances of other comprehensive income (loss) for the year ended December 31, 2025:

Unrealized Gains (Losses) on Cash Flow Hedges Unrealized Gains (Losses) on Available-for-sale Debt Securities Foreign Currency Translation Adjustment ( “ CTA ”)

Unrealized Gains (Losses) on Cash Flow Hedges Unrealized Gains (Losses) on Available-for-sale Debt Securities Foreign CTA

Net Investment

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Ending balance $ ( 56 ) $ ( 134 ) $ ( 731 ) $ 191 $ ( 16 ) $ ( 746 )

FY 2025 FORM 10-K

PayPal Holdings, Inc.

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$ ( 166 ) $ 48 $ 111 Net revenues

Net gains (losses) on cash flow hedges — foreign exchange contracts

( 2 ) — — Customer support and operations

Net gains (losses) on cash flow hedges — foreign exchange contracts

( 3 ) — — Technology and development

Net gains (losses) on cash flow hedges — foreign exchange contracts

( 1 ) — — General and administrative

Net gains (losses) on investments

16 unchanged sentences

Refer to “Note 1 — Overview and Summary of Significant Accounting Policies” for details on the composition of these balances.

FY 2025 FORM 10-K

PayPal Holdings, Inc.

23 unchanged sentences

Total long-term investments $ 4,330 $ 4,583

(1) Includes nil and $ 777 million of available-for-sale debt securities with original maturities of three months or less as of December 31, 2024 and 2023, respectively.

(1) Includes $ 374 million and $ 149 million of available-for-sale debt securities with original maturities of three months or less as of December 31, 2025 and 2024, respectively.

FY 2025 FORM 10-K

PayPal Holdings, Inc.

28 unchanged sentences

Refer to “Note 9 — Fair Value Measurement of Assets and Liabilities.”

FY 2025 FORM 10-K

PayPal Holdings, Inc.

2 unchanged sentences

(In millions)

Cash and cash equivalents:

government and agency securities $ 428 $ — $ — $ 428

Commercial paper 349 — — 349

Funds receivable and customer accounts:

2 unchanged sentences

Corporate debt securities 405 — — 405

Asset-backed securities 1,421 4 ( 2 ) 1,423

Mortgage-backed and asset-backed securities

4,039 13 ( 5 ) 4,047

Municipal securities 503 1 — 504

4 unchanged sentences

Corporate debt securities 1,751 — ( 2 ) 1,749

Asset-backed securities 719 3 ( 4 ) 718

Mortgage-backed and asset-backed securities

Commercial paper 1,281 1 — 1,282

3 unchanged sentences

Corporate debt securities 1,601 3 ( 2 ) 1,602

Asset-backed securities 759 2 — 761

Mortgage-backed and asset-backed securities

1,042 1 ( 1 ) 1,042

Total available-for-sale debt securities (2)

4 unchanged sentences

Gross amortized cost and estimated fair value balances exclude accrued interest receivable on available-for-sale debt securities, which totaled $ 101 million and $ 140 million at December 31, 2025 and 2024, respectively, and were included in other current assets on our consolidated balance sheets.

FY 2025 FORM 10-K

PayPal Holdings, Inc.

13 unchanged sentences

1,000 ( 1 ) 206 — 1,206 ( 1 )

Municipal securities 29 — 36 — 65 —

Commercial paper 1,375 — — — 1,375 —

1 unchanged sentence

government and agency securities 443 — — — 443 —

Foreign government and agency securities — — 20 — 20 —

Corporate debt securities 94 ( 1 ) 109 ( 1 ) 203 ( 2 )

3 unchanged sentences

Long-term investments:

government and agency securities 50 — — — 50 —

Foreign government and agency securities 25 — — — 25 —

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(1) “—” Denotes gross unrealized loss or fair value of less than $1 million in a given position.

FY 2025 FORM 10-K

PayPal Holdings, Inc.

6 unchanged sentences

(In millions)

Cash and cash equivalents:

Commercial paper $ 349 $ — $ — $ — $ 349 $ —

Funds receivable and customer accounts:

2 unchanged sentences

Corporate debt securities 105 — 50 — 155 —

Asset-backed securities 253 — 473 ( 2 ) 726 ( 2 )

Mortgage-backed and asset-backed securities

1,673 ( 5 ) 2 — 1,675 ( 5 )

Municipal securities 29 — 36 — 65 —

2 unchanged sentences

government and agency securities — — 186 ( 2 ) 186 ( 2 )

Foreign government and agency securities — — 347 ( 6 ) 347 ( 6 )

Corporate debt securities 618 ( 2 ) 90 — 708 ( 2 )

Asset-backed securities 131 — 144 ( 4 ) 275 ( 4 )

Mortgage-backed and asset-backed securities

250 — 18 — 268 —

Commercial paper 218 — — — 218 —

3 unchanged sentences

Corporate debt securities 347 ( 1 ) 9 ( 1 ) 356 ( 2 )

Asset-backed securities 109 — 195 — 304 —

Mortgage-backed and asset-backed securities

610 ( 1 ) — — 610 ( 1 )

Total available-for-sale debt securities $ 5,636 $ ( 10 ) $ 942 $ ( 5 ) $ 6,578 $ ( 15 )

3 unchanged sentences

We will continue to monitor the performance of the investment portfolio and assess whether impairment due to expected credit losses has occurred.

During the years ended December 31, 2024 and 2023, we received $ 33.5 billion and $ 30.3 billion in proceeds from the sales and maturities of available-for-sale debt securities and incurred gross realized losses of $ 44 million and $ 26 million, respectively, and de minimis gross realized gains, which were determined using the specific identification method.

The table below presents cash inflows related to available-for-sale debt securities:

Year Ended December 31,

2025 2024 2023

(In millions)

Proceeds from sales and maturities of available-for-sale debt securities

$ 27,173 $ 33,455 $ 30,320

During the year ended December 31, 2025, we incurred gross realized gains and losses which were de minimis.

During the years ended December 31, 2024 and 2023, we incurred gross realized losses of $ 44 million and $ 26 million, respectively, and de minimis gross realized gains.

Gross realized gains and losses were determined using the specific identification method.

FY 2025 FORM 10-K

PayPal Holdings, Inc.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS—(Continued)

Our available-for-sale debt securities included within cash and cash equivalents, funds receivable and customer accounts, short-term investments, and long-term investments classified by date of contractual maturity were as follows:

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Actual maturities may differ from contractual maturities as certain securities may be prepaid.

PayPal Holdings, Inc.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS—(Continued)

Supplemental cash flow information related to investments

Non-cash investing transactions that are not reflected in the consolidated statement of cash flows for the year ended December 31, 2024 include the purchase of investments of $ 150 million that have not yet settled.

STRATEGIC INVESTMENTS

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Marketable equity securities totaled $ 180 million and $ 23 million as of December 31, 2025 and 2024, respectively.

As of December 31, 2025, we held marketable equity securities with a fair value of $ 164 million with a time-based contractual sale restriction, which is set to expire in May 2026.

Our non-marketable equity securities are recorded in long-term investments on our consolidated balance sheets.

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Adjustments related to non-marketable equity securities:

Net (sales) additions (1)

Net additions (reductions) (1)

Gross unrealized gains 212 20

1 unchanged sentence

Carrying amount, end of period $ 1,509 $ 1,336

(1) Net (sales) additions include purchases, reductions due to sales of securities, and reclassifications when the Measurement Alternative is subsequently elected or no longer applies.

(1) Net additions (reductions) include purchases, reductions due to sales of securities, and reclassifications when the Measurement Alternative is subsequently elected or no longer applies.

The following table summarizes the cumulative gross unrealized gains and cumulative gross unrealized losses and impairment related to non-marketable equity securities accounted for under the Measurement Alternative, held at December 31, 2025 and 2024, respectively:

FY 2025 FORM 10-K

PayPal Holdings, Inc.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS—(Continued)

2025 December 31,

2 unchanged sentences

Cumulative gross unrealized losses and impairments $ ( 353 ) $ ( 562 )

PayPal Holdings, Inc.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS—(Continued)

Unrealized gains (losses) on strategic investments, excluding those accounted for using the equity method

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Net unrealized gains (losses) $ 168 $ ( 270 )

Supplemental cash flow information related to investments

Non-cash investing transactions that are not reflected in the consolidated statement of cash flows for the year ended December 31, 2025, 2024, and 2023 include the purchase of investments of $ 189 million, $ 150 million and $ 22 million, respectively, that have not yet settled.

FY 2025 FORM 10-K

PayPal Holdings, Inc.

10 unchanged sentences

Money market fund

$ 14 $ 14 $ —

Short-term investments (2),(5) :

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Derivatives (4)

Crypto asset safeguarding asset (4)

2,886 — 2,886

Long-term investments (2),(5) :

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$ 158 $ — $ 158

Crypto asset safeguarding liability (4)

2,886 — 2,886

Total financial liabilities $ 158 $ — $ 158

(1) Excludes cash of $ 6.5 billion not measured and recorded at fair value.

(2) Excludes restricted cash of $ 1 million and time deposits of $ 129 million not measured and recorded at fair value.

(1) Excludes cash and cash equivalents of $ 8.0 billion not measured and recorded at fair value.

(2) Excludes time deposits of $ 93 million not measured and recorded at fair value.

(3) Excludes cash, time deposits, and funds receivable of $ 23.4 billion underlying funds receivable and customer accounts not measured and recorded at fair value.

(4) Derivative assets and liabilities are included within “prepaid expenses and other current assets” and “other assets” and “accrued expenses and other current liabilities” and “other long-term liabilities,” respectively, on our consolidated balance sheets.

Crypto safeguarding asset and associated liability are recorded within “prepaid expenses and other current assets” and “accrued expenses and other current liabilities,” respectively, on our consolidated balance sheets.

(5) Excludes non-marketable equity securities of $ 1.7 billion measured using the Measurement Alternative or equity method accounting.

FY 2025 FORM 10-K

PayPal Holdings, Inc.

6 unchanged sentences

Cash and cash equivalents (1) :

government and agency securities $ 428 $ — $ 428

Commercial paper 349 — 349

Money market fund

Total cash and cash equivalents

$ 14 $ 14 $ —

Short-term investments (2) :

2 unchanged sentences

Corporate debt securities 1,749 — 1,749

Asset-backed securities 718 — 718

Mortgage-backed and asset-backed securities

Commercial paper 1,282 — 1,282

4 unchanged sentences

Corporate debt securities 667 — 667

Asset-backed securities 1,423 — 1,423

Mortgage-backed and asset-backed securities

4,047 — 4,047

Municipal securities 504 — 504

2 unchanged sentences

Derivatives (4)

Crypto asset safeguarding asset (4)

1,241 — 1,241

Long-term investments (2), (5) :

2 unchanged sentences

Corporate debt securities 1,602 — 1,602

Asset-backed securities 761 — 761

Mortgage-backed and asset-backed securities

1,042 — 1,042

Marketable equity securities 23 23 —

3 unchanged sentences

$ 37 $ — $ 37

Crypto asset safeguarding liability (4)

1,241 — 1,241

Total financial liabilities $ 37 $ — $ 37

(1) Excludes cash of $ 8.1 billion not measured and recorded at fair value.

(1) Excludes cash and cash equivalents of $ 6.6 billion not measured and recorded at fair value.

(2) Excludes restricted cash of $ 1 million and time deposits of $ 129 million not measured and recorded at fair value.

1 unchanged sentence

(5) Excludes non-marketable equity securities of $ 1.5 billion measured using the Measurement Alternative or equity method accounting.

PayPal Holdings, Inc.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS—(Continued)

Our financial assets classified within Level 1 are valued using quoted prices for identical assets in active markets.

There are no active markets for our crypto asset safeguarding liability or the corresponding safeguarding asset.

Accordingly, we have valued the asset and liability using quoted prices on the active exchange that we have identified as the principal market for the underlying crypto assets (Level 2).

All other financial assets and liabilities are valued using quoted prices for identical instruments in less active markets, readily available pricing sources for comparable instruments, or models using market observable inputs (Level 2).

A majority of our derivative instruments are valued using pricing models that take into account the contract terms as well as multiple observable inputs where applicable, such as currency rates, interest rate yield curves, option volatility, and equity prices (Level 2).

A majority of our derivative instruments are valued using pricing models that take into account the contractual terms as well as multiple observable inputs where applicable, such as currency rates, interest rate yield curves, option volatility, and equity prices (Level 2).

FY 2025 FORM 10-K

PayPal Holdings, Inc.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS—(Continued)

As of December 31, 2025 and 2024, we did not have any assets or liabilities requiring measurement at fair value on a recurring basis with significant unobservable inputs that would require a high level of judgment to determine fair value (Level 3).

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(1) Excludes non-marketable equity securities of $ 819 million accounted for under the Measurement Alternative for which no observable price changes occurred during the year ended December 31, 2025.

PayPal Holdings, Inc.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS—(Continued)

December 31, 2024 Significant Other Observable Inputs (Level 2) Significant Other Unobservable Inputs (Level 3)

3 unchanged sentences

Non-marketable equity securities measured using the Measurement Alternative (1)

Other assets (3)

Total $ 1,017 $ 672 $ 345

(1) As of December 31, 2023, loans and interest receivable, held for sale were valued using a price-based model.

The price was the significant unobservable input and was determined based upon certain loan and risk classifications of the portfolio.

Low, high and weighted average prices were all $ 0.99 , measured in relation to $ 1.00 par.

(2) Excludes non-marketable equity securities of $ 1.2 billion accounted for under the Measurement Alternative for which no observable price changes occurred during the year ended December 31, 2023.

(3) Consists of ROU lease assets recorded at fair value pursuant to impairment charges that occurred during the year ended December 31, 2023.

Beginning with the first quarter of 2024, we measure loans and interest receivable, held for sale using observable inputs, such as the most recent executed prices for comparable loans sold to the global investment firm.

Accordingly, loans and interest receivable, held for sale are classified within Level 2 in the fair value hierarchy.

(1) Excludes non-marketable equity securities of $ 860 million accounted for under the Measurement Alternative for which no observable price changes occurred during the year ended December 31, 2024.

FY 2025 FORM 10-K

PayPal Holdings, Inc.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS—(Continued)

We measure loans and interest receivable, held for sale that are comparable to loans receivable sold to third-party investors using observable inputs, such as the most recent executed prices.

These loans and interest receivable, held for sale are classified within Level 2 in the fair value hierarchy.

Certain loans and interest receivable, held for sale are valued using significant unobservable inputs, such as adjustments to recently executed prices.

These loans and interest receivable, held for sale are classified within Level 3 in the fair value hierarchy.

Refer to “Note 11—Loans and Interest Receivable” for additional information on loans and interest receivable, held for sale.

2 unchanged sentences

The fair value of non-marketable equity securities are classified within Level 3 when we estimate fair value using significant unobservable inputs such as when we remeasure due to impairment and use discount rates, forecasted cash flows, and market data of comparable companies, among others.

We evaluate ROU assets related to leases for indicators of impairment whenever events or changes in circumstances indicate that the carrying amount of an ROU asset may not be recoverable.

Impairment losses on ROU lease assets related to office operating leases are calculated using estimated rental income per square foot derived from observable market data, and the impaired asset is classified within Level 2 in the fair value hierarchy.

FINANCIAL ASSETS AND LIABILITIES NOT MEASURED AND RECORDED AT FAIR VALUE

Our financial instruments, including cash, restricted cash, time deposits, reverse repurchase agreements, loans and interest receivable, net, certain customer accounts, notes receivable, and long-term debt related to borrowings on our credit facilities are carried at amortized cost, which approximates their fair value.

Our term debt (including current portion) in the form of fixed rate notes had a carrying value of approximately $ 10.5 billion and fair value of approximately $ 9.8 billion as of December 31, 2024.

Our term debt (including current portion) in the form of fixed rate notes had a carrying value of approximately $ 10.6 billion and fair value of approximately $ 10.0 billion as of December 31, 2023.

If these financial instruments were measured at fair value in the financial statements, cash would be classified as Level 1;

restricted cash, time deposits, reverse repurchase agreements, certain customer accounts, and term debt (including current portion) would be classified as Level 2;

Our financial instruments, including cash and certain cash equivalents, restricted cash, time deposits, reverse repurchase agreements, certain loans and interest receivable, held for sale, loans and interest receivable, net, certain customer accounts, notes receivable, commercial paper, and long-term debt related to borrowings on our credit facilities are carried at amortized cost, which approximates their fair value.

Our term debt (including current portion) had a carrying value of approximately $ 10.8 billion and fair value of approximately $ 10.3 billion as of December 31, 2025.

Our term debt (including current portion) had a carrying value of approximately $ 10.5 billion and fair value of approximately $ 9.8 billion as of December 31, 2024.

If these financial instruments were measured at fair value in the financial statements, cash and certain cash equivalents would be classified as Level 1;

restricted cash, time deposits, reverse repurchase agreements, certain loans and interest receivable, held for sale, certain customer accounts, commercial paper, and term debt (including current portion) would be classified as Level 2;

and the remaining financial instruments would be classified as Level 3 in the fair value hierarchy.

6 unchanged sentences

We do not use any derivative instruments for trading or speculative purposes.

PayPal Holdings, Inc.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS—(Continued)

Cash flow hedges

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dollar/foreign currency exchange rate.

These derivative instruments are designated as cash flow hedges and accordingly, the derivative’s gain or loss is initially reported as a component of AOCI and subsequently reclassified into revenue or applicable expense line item in the consolidated statements of income (loss) in the same period the forecasted transaction affects earnings.

These derivative instruments are designated as cash flow hedges and accordingly, the derivative’s gain or loss is initially reported as a component of AOCI and subsequently reclassified into revenue or the applicable expense line item in the consolidated statements of income (loss) in the same period the forecasted transaction affects earnings.

We evaluate the effectiveness of our foreign exchange contracts on a quarterly basis by comparing the critical terms of the derivative instruments with the critical terms of the forecasted cash flows of the hedged item;

1 unchanged sentence

We do not exclude any component of the changes in fair value of the derivative instruments from the assessment of hedge effectiveness.

We report cash flows arising from derivative instruments consistent with the classification of cash flows from the underlying hedged items that these derivatives are hedging.

We report cash flows arising from derivative instruments consistent with the classification of cash flows from the underlying items that these derivatives are hedging.

Accordingly, the cash flows associated with derivatives designated as cash flow hedges are classified in cash flows from operating activities on our consolidated statements of cash flows.

As of December 31, 2024, we estimated that $ 147 million of net derivative gains related to our cash flow hedges included in AOCI are expected to be reclassified into earnings within the next 12 months.

FY 2025 FORM 10-K

PayPal Holdings, Inc.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS—(Continued)

As of December 31, 2025, we estimated that $ 111 million of net derivative losses related to our cash flow hedges included in AOCI are expected to be reclassified into earnings within the next 12 months.

During the years ended December 31, 2025, 2024, and 2023, we did not discontinue any cash flow hedges because it was probable that the original forecasted transaction would not occur and as such, did not reclassify any gains or losses to earnings prior to the occurrence of the hedged transaction.

If we elect to discontinue our cash flow hedges and it is probable that the original forecasted transaction will occur, we continue to report the derivative’s gain or loss in AOCI until the forecasted transaction affects earnings, at which point we also reclassify it into earnings.

Gains and losses on derivatives held after we discontinue our cash flow hedges and on derivative instruments that are not designated as cash flow hedges are recorded in the same financial statement line item to which the derivative relates.

Net investment hedges

We use forward foreign exchange contracts to reduce the foreign exchange risk related to our investment in certain foreign subsidiaries.

These derivatives are designated as net investment hedges and accordingly, the gains and losses on the portion of the derivatives included in the assessment of hedge effectiveness is recorded in AOCI as part of foreign currency translation.

We exclude forward points from the assessment of hedge effectiveness and recognize them in other income (expense), net on a straight-line basis over the life of the hedge.

Prior to 2025, we used foreign exchange contracts to reduce the foreign exchange risk related to our investment in certain foreign subsidiaries.

These derivatives were designated as net investment hedges and accordingly, the gains and losses on the portion of the derivatives included in the assessment of hedge effectiveness were recorded in AOCI as part of foreign currency translation.

We excluded forward points from the assessment of hedge effectiveness and recognized them in other income (expense), net on a straight-line basis over the life of the hedge.

The accumulated gains and losses associated with these instruments will remain in AOCI until the foreign subsidiaries are sold or substantially liquidated, at which point they will be reclassified into earnings.

6 unchanged sentences

The cash flows associated with our non-designated derivatives used to hedge foreign currency denominated monetary assets and liabilities are classified in cash flows from operating activities on our consolidated statements of cash flows.

PayPal Holdings, Inc.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS—(Continued)

FAIR VALUE OF DERIVATIVE CONTRACTS

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Other current assets $ 7 $ 157

Foreign exchange contracts designated as hedging instruments

Other assets (non-current) — 77

Foreign exchange contracts not designated as hedging instruments

7 unchanged sentences

Total derivative liabilities $ 158 $ 37

FY 2025 FORM 10-K

PayPal Holdings, Inc.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS—(Continued)

EFFECT OF DERIVATIVE CONTRACTS ON CONSOLIDATED FINANCIAL STATEMENTS

1 unchanged sentence

Year Ended December 31,

2024 2023 2022

(In millions)

Net revenues Other income (expense), net Net revenues Other income (expense), net Net revenues Other income (expense), net

Net revenues Customer support and operations Technology and development General and administrative Other income (expense), net

Total amounts presented in the consolidated statements of income (loss) in which the effects of cash flow hedges and net investment hedges are recorded

2 unchanged sentences

Amount of net gains (losses) on foreign exchange contracts reclassified from AOCI ( 166 ) ( 2 ) ( 3 ) ( 1 ) —

Gains (losses) on derivatives not designated as hedging instruments:

Amount of net gains (losses) on foreign exchange contracts — — — — ( 216 )

Total gains (losses) $ ( 166 ) $ ( 2 ) $ ( 3 ) $ ( 1 ) $ ( 216 )

Year Ended December 31,

(In millions)

Net revenues Other income (expense), net Net revenues Other income (expense), net

Total amounts presented in the consolidated statements of income (loss) in which the effects of cash flow hedges and net investment hedges are recorded

$ 31,797 $ 4 $ 29,771 $ 383

Gains (losses) on derivatives in cash flow hedging relationship:

Amount of net gains (losses) on foreign exchange contracts reclassified from AOCI

Gains (losses) on derivatives in net investment hedging relationship:

Amount of net gains (losses) on foreign exchange contracts excluded from the assessment of effectiveness

— 67 — 100 — 84

Gains (losses) on derivatives not designated as hedging instruments:

2 unchanged sentences

Amount of gains (losses) on equity derivative contracts (1)

— — — 44 — ( 174 )

Total net gains (losses)

$ 48 $ 178 $ 111 $ ( 119 )

(1) During the years ended December 31, 2023 and 2022, equity derivative contracts were entered into and matured in association with the sale of marketable equity securities related to strategic investments.

(1) During the year ended December 31, 2023, equity derivative contracts were entered into and matured in association with the sale of marketable equity securities related to strategic investments.

The cash flows associated with the equity derivative contracts were classified in cash flows from investing activities on our consolidated statements of cash flows.

FY 2025 FORM 10-K

PayPal Holdings, Inc.

7 unchanged sentences

Unrealized net gains (losses) on foreign exchange contracts designated as net investment hedges

122 192 ( 25 )

Total unrealized net gains (losses) recognized from derivative contracts designated as hedging instruments in the consolidated statements of comprehensive income (loss)

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The notional amount is generally not exchanged, but is used only as the underlying basis on which the value of foreign currency exchange payments under these contracts is determined.

The following table provides the notional amounts of our outstanding derivatives:

The following table provides the notional amounts of our outstanding derivative instruments:

Year Ended December 31,

8 unchanged sentences

Receivables related to cash collateral posted and payables related to cash collateral received are recognized in other current assets and other current liabilities, respectively, on our consolidated balance sheets.

FY 2025 FORM 10-K

PayPal Holdings, Inc.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS—(Continued)

The following tables present the derivative assets, derivative liabilities, repurchase agreements, and reverse repurchase agreements not offset on the consolidated balance sheet but available for offset in the event of default.

The following tables present the derivative assets, derivative liabilities, and reverse repurchase agreements not offset on the consolidated balance sheets but available for offset in the event of default.

The tables also present the cash and non-cash collateral received or pledged relating to these positions.

The amount of collateral presented is limited to the amount presented on our consolidated balance sheet;

The amount of collateral presented is limited to the amount presented on our consolidated balance sheets;

therefore, instances of over-collateralization are excluded from the table below.

Amounts not Offset on the Consolidated Balance Sheet

Amounts Not Offset on the Consolidated Balance Sheets

Amounts Presented on the Consolidated Balance Sheet

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$ 330 $ 23 $ 256 $ 51

Amounts not Offset on the Consolidated Balance Sheet

Amounts Not Offset on the Consolidated Balance Sheets

Amounts Presented on the Consolidated Balance Sheet

5 unchanged sentences

$ 158 $ 13 $ 122 $ 23

Repurchase agreements

Total liabilities

$ 37 $ 23 $ 7 $ 7

As of December 31, 2024

1 unchanged sentence

$ 37 $ 23 $ 7 $ 7

Repurchase agreements

Total liabilities

$ 131 $ 38 $ 54 $ 39

(1) For derivative positions, this includes any derivative fair value that could be offset in the event of counterparty default.

For repurchase or reverse repurchase positions this includes any payable or receivable, respectively, that could be offset in the event of counterparty default.

For reverse repurchase positions this includes any receivable that could be offset in the event of counterparty default.

(2) Includes cash and the fair value of securities exchanged with the counterparty.

For reverse repurchase agreements, these securities are not included in the consolidated balance sheet unless the counterparty defaults.

(3) We received cash collateral from derivative counterparties totaling $ 162 million and $ 6 million as of December 31, 2024 and 2023, respectively, and securities from derivative counterparties with a fair value of $ 30 million and nil as of December 31, 2024 and 2023, respectively.

We posted $ 7 million and $ 80 million of cash collateral as of December 31, 2024 and 2023, respectively.

(3) We received cash collateral from derivative counterparties totaling $ 2 million and $ 162 million as of December 31, 2025 and 2024, respectively, and securities from derivative counterparties with a fair value of $ 90 million and $ 30 million as of December 31, 2025 and 2024, respectively.

We posted $ 156 million and $ 7 million of cash collateral as of December 31, 2025 and 2024, respectively, and securities to derivative counterparties with a fair value of $ 91 million and nil as of December 31, 2025 and 2024, respectively.

(4) PayPal is permitted by contract to sell or repledge collateral relating to its reverse repurchase agreements.

The fair value of this collateral was $ 96 million and nil as of December 31, 2024 and 2023, respectively.

We have no t sold or repledged as of both December 31, 2024 and 2023.

PayPal Holdings, Inc.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS—(Continued)

The fair value of this collateral was nil and $ 96 million as of December 31, 2025 and 2024, respectively.

As of both December 31, 2025 and 2024, we have not sold or repledged collateral relating to reverse repurchase agreements.

NOTE 11— LOANS AND INTEREST RECEIVABLE

LOANS AND INTEREST RECEIVABLE, HELD FOR SALE

In June 2023, we entered into a multi-year agreement with a global investment firm to sell our eligible consumer installment receivables portfolio, including a forward-flow arrangement for the sale of future originations.

In December 2024, this agreement was amended and restated to extend the commitment period to December 2026 and to increase the maximum balance of loans that can be sold at a time.

During the year ended December 31, 2023, we reclassified approximately $ 1.2 billion of eligible consumer installment receivables from loans and interest receivable, net to loans and interest receivable, held for sale.

See “Note 1—Overview and Summary of Significant Accounting Policies” for additional information.

As of December 31, 2024 and 2023, loans and interest receivable, held for sale was $ 541 million and $ 563 million, respectively.

During the years ended December 31, 2024 and 2023, we sold $ 20.8 billion and $ 5.5 billion of loans and interest receivable, respectively, in connection with the above mentioned agreement.

As of December 31, 2025 and 2024, loans and interest receivable, held for sale was $ 1.7 billion and $ 541 million, respectively, and included both loans reclassified to held for sale and loans originated as held for sale.

During the years ended December 31, 2025 and 2024, we reclassified $ 574 million and nil , respectively, of loans and interest receivable, net to loans and interest receivable, held for sale.

During the year ended December 31, 2025, we derecognized loans with an unpaid balance of $ 26.9 billion and had net proceeds of $ 26.7 billion from loans and interest receivable sold.

During the year ended December 31, 2024, we derecognized loans with an unpaid balance of $ 20.9 billion and had net proceeds of $ 20.8 billion from loans and interest receivable sold.

FY 2025 FORM 10-K

PayPal Holdings, Inc.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS—(Continued)

LOANS AND INTEREST RECEIVABLE, NET

4 unchanged sentences

We offer non interest-bearing installment credit products in these markets as well as interest-bearing installment credit products in the U.S.

and Germany, among other markets.

We purchase receivables related to interest-bearing installment loans extended to U.S.

consumers by a partner institution and are responsible for the servicing functions related to that portfolio.

During the years ended December 31, 2024 and 2023, we purchased approximately $ 690 million and $ 670 million in consumer receivables, respectively.

consumers by an independent chartered financial institution (“partner institution”) and are responsible for the servicing functions related to that portfolio.

During the years ended December 31, 2025 and 2024, we purchased approximately $ 1.3 billion and $ 690 million in consumer receivables, respectively.

As of December 31, 2025 and 2024, the outstanding balance of consumer receivables, which consisted of revolving and installment loans and interest receivable, was $ 5.5 billion and $ 5.4 billion, respectively, net of the participation interest sold to the partner institution of $ 33 million and $ 23 million, respectively.

See “Note 1—Overview and Summary of Significant Accounting Policies” for additional information on this participation arrangement.

We closely monitor the credit quality of our consumer receivables to evaluate and manage our related exposure to credit risk.

Consumer receivables delinquency and allowance

We closely monitor the credit quality of our revolving and installment loans to evaluate and manage our related exposure to credit risk.

Credit risk management begins with initial underwriting and continues through the full repayment of a loan.

1 unchanged sentence

We use delinquency status and trends to assist in making (or, for interest-bearing installment loans in the U.S., to assist the partner institution in making) new and ongoing credit decisions, to adjust our models, to plan our collection practices and strategies, and in determining our allowance for consumer loans and interest receivable.

PayPal Holdings, Inc.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS—(Continued)

Consumer receivables delinquency and allowance

The following tables present the delinquency status and gross charge-offs of consumer loans and interest receivable by year of origination.

The following tables present the delinquency status and gross charge-offs of revolving and installment loans and interest receivable by year of origination, as applicable.

The amounts are based on the number of days past the billing date for revolving loans or contractual repayment date for installment loans.

13 unchanged sentences

$ 136 $ 36 $ 107 $ 20 $ 1 $ — $ 300

FY 2025 FORM 10-K

PayPal Holdings, Inc.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS—(Continued)

December 31, 2024

11 unchanged sentences

$ 138 $ 39 $ 133 $ 14 $ — $ — $ 324

PayPal Holdings, Inc.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS—(Continued)

The following table summarizes the activity in the allowance for consumer loans and interest receivable for the years ended December 31, 2025 and 2024:

11 unchanged sentences

Ending balance $ 366 $ 3 $ 369 $ 341 $ 7 $ 348

(1) Beginning balances, provisions and charge-offs include amounts related to loans and interest receivable prior to their reclassification to loan and interest receivable, held for sale.

(1) Beginning balances, provisions and charge-offs include amounts related to loans and interest receivable prior to their reclassification to loan and interest receivable, held for sale during the period.

(2) Includes amounts related to foreign currency remeasurement.

The allowance for credit losses at December 31, 2024 for our consumer receivable portfolio was $ 348 million, a decrease from $ 380 million at December 31, 2023.

The decrease in allowance for credit losses was related to the improvement in credit quality of interest-bearing installment loans in the U.S.

offset by the growth of interest-bearing installment loans in the U.S., revolving loans in the U.K., and installment loans in Japan.

The allowance for credit losses at December 31, 2025 for our consumer receivable portfolio was $ 369 million, an increase from $ 348 million at December 31, 2024.

The increase in allowance for credit losses was related to the growth of revolving loans in the U.K.

and interest-bearing installment loans in the U.S.

partially offset by the release of reserves as a result of the reclassification of certain non interest-bearing installment loans in the U.S.

to held for sale.

Merchant receivables

3 unchanged sentences

During the years ended December 31, 2025 and 2024, we purchased approximately $ 2.2 billion and $ 1.8 billion in merchant receivables, respectively.

As of December 31, 2024 and 2023, the total outstanding balance in our pool of merchant loans, advances, and interest and fees receivable was $ 1.5 billion and $ 1.2 billion, respectively, net of the participation interest sold to the partner institution of $ 53 million and $ 44 million, respectively.

See “Note 1—Overview and Summary of Significant Accounting Policies” for additional information on this participation arrangement.

As of December 31, 2025 and 2024, the total outstanding balance in our pool of merchant loans, advances, and fees receivable was $ 1.8 billion and $ 1.5 billion, respectively, net of the participation interest sold to the partner institution of $ 65 million and $ 53 million, respectively.

FY 2025 FORM 10-K

PayPal Holdings, Inc.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS—(Continued)

Through our PPWC product, merchants can borrow a certain percentage of their annual payment volume processed by PayPal and are charged a fixed fee for the loan or advance based on the overall credit assessment of the merchant.

2 unchanged sentences

PPBL repayments are collected through periodic payments until the balance has been satisfied.

The interest or fee is fixed at the time the loan or advance is extended and is recognized as deferred revenue in accrued expenses and other current liabilities on our consolidated balance sheets.

The fixed interest or fee is amortized into revenues from other value added services based on the amount repaid over the repayment period.

The fee is fixed at the time the loan or advance is extended and is recognized as deferred revenue in accrued expenses and other current liabilities on our consolidated balance sheets.

The fixed fee is amortized into revenues from other value added services based on the amount repaid over the repayment period.

We estimate the repayment period for PPWC based on the merchant’s payment processing history with PayPal.

4 unchanged sentences

For PPBL, we receive fixed periodic payments over the contractual term of the loan, which generally ranges from 3 to 12 months.

PayPal Holdings, Inc.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS—(Continued)

Merchant receivables delinquency and allowance

We actively monitor receivables with repayment periods greater than the original expected or contractual repayment period, as well as the credit quality of our merchant loans and advances that we extend or purchase, so that we can evaluate, quantify, and manage our credit risk exposure.

To assess a merchant seeking a loan or advance, we use, among other indicators, risk models developed internally which utilize information obtained from multiple internal and external data sources to predict the likelihood of timely and satisfactory repayment by the merchant of the loan or advance amount and the related interest or fee.

Primary drivers of the models include the merchant’s annual payment volume, payment processing history with PayPal, prior repayment history with PayPal’s credit products where available, information sourced from consumer and business credit bureau reports, and other information obtained during the application process.

We use delinquency status and trends to assist in making (or, in the U.S., to assist the partner institution in making) ongoing credit decisions, to adjust our internal models, to plan our collection strategies, and in determining our allowance for these loans, advances, and interest and fees receivable.

Merchant receivables delinquency and allowance

The following tables present the delinquency status and gross charge-offs of merchant loans, advances, and interest and fees receivable by year of origination.

The following tables present the delinquency status and gross charge-offs of merchant loans, advances, and fees receivable by year of origination.

The amounts are based on the number of days past the expected or contractual repayment date for amounts outstanding.

4 unchanged sentences

Total Percent

Merchant loans, advances, and interest and fees receivable:

Merchant loans, advances, and fees receivable:

Current $ 1,558 $ 53 $ 5 $ 3 $ — $ 2 $ 1,621 89.8 %

6 unchanged sentences

$ 25 $ 87 $ 19 $ 4 $ — $ 2 $ 137

FY 2025 FORM 10-K

PayPal Holdings, Inc.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS—(Continued)

December 31, 2024

(In millions, except percentages)

2024 2023 2022 2021 2020 Prior

Total Percent

Merchant loans, advances, and interest and fees receivable:

Merchant loans, advances, and fees receivable:

Current $ 1,274 $ 28 $ 13 $ 1 $ 8 $ 4 $ 1,328 90.4 %

6 unchanged sentences

$ 10 $ 96 $ 42 $ — $ 8 $ — $ 156

PayPal Holdings, Inc.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS—(Continued)

The following table summarizes the activity in the allowance for merchant loans, advances, and interest and fees receivable, for the years ended December 31, 2024 and 2023:

The following table summarizes the activity in the allowance for merchant loans, advances, and fees receivable, for the years ended December 31, 2025 and 2024:

December 31, 2025 December 31, 2024

Merchant Loans and Advances Interest and Fees Receivable Total Allowance Merchant Loans and Advances Interest and Fees Receivable Total Allowance

Merchant Loans and Advances Fees Receivable

Total Allowance Merchant Loans and Advances Fees Receivable

Total Allowance

(In millions)

4 unchanged sentences

Ending balance $ 156 $ 14 $ 170 $ 107 $ 6 $ 113

The allowance for credit losses at December 31, 2024 for our merchant receivable portfolio was $ 113 million, a decrease from $ 160 million at December 31, 2023.

The decrease in allowance for credit losses was related to the improvement in credit quality of the PPBL portfolio.

(1) Includes amounts related to foreign currency remeasurement.

The allowance for credit losses at December 31, 2025 for our merchant receivable portfolio was $ 170 million, an increase from $ 113 million at December 31, 2024.

The increase in allowance for credit losses was related to the growth of the merchant receivables portfolio as well as a decline in credit quality of merchant loans outstanding primarily from modifications in acceptable risk parameters in 2024, which included broadened eligibility.

FY 2025 FORM 10-K

PayPal Holdings, Inc.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS—(Continued)

NOTE 12— DEBT

FIXED RATE NOTES

In March 2025, we issued fixed and floating rate notes with varying maturity dates for an aggregate principal amount of $ 1.5 billion, consisting of $ 450 million aggregate principal amount of floating rate notes due 2028 (the “2028 Floating Rate Notes”), $ 450 million aggregate principal amount of 4.450 % notes due 2028 (the “2028 Notes”) and $ 600 million aggregate principal amount of 5.100 % notes due 2035 (the “2035 Notes”).

Interest on the 2028 Floating Rate Notes is payable on March 6, June 6, September 6 and December 6 of each year, beginning on June 6, 2025.

The 2028 Floating Rate Notes bear interest at a floating rate equal to the compounded secured overnight financing rate, reset quarterly, plus 0.670 % per annum.

Interest on the 2028 Notes is payable on March 6 and September 6 of each year, beginning on September 6, 2025.

Interest on the 2035 Notes is payable on April 1 and October 1 of each year, beginning on October 1, 2025.

In May 2024, we issued fixed rate notes with varying maturity dates for an aggregate principal amount of $ 1.3 billion.

8 unchanged sentences

Interest on these notes is payable on April 1 and October 1.

The notes issued from the May 2024, June 2023, May 2022, May 2020, and September 2019 debt issuances are senior unsecured obligations and are collectively referred to as the “Notes.” Interest on the Notes is payable in arrears semiannually.

We may redeem the Notes in whole, at any time, or in part (except for the June 2023 notes), from time to time, prior to maturity, at their redemption prices.

The notes issued from the March 2025, May 2024, June 2023, May 2022, May 2020, and September 2019 debt issuances are senior unsecured obligations and are collectively referred to as the “Notes.” Interest on the Notes is payable in arrears.

Except for the June 2023 debt issuance and 2028 Floating Rate Notes, we may redeem the Notes in whole at any time or in part from time to time, prior to maturity, at their redemption prices.

Upon the occurrence of both a change of control of the Company and a downgrade of the Notes below an investment grade rating, we will be required to offer to repurchase each series of Notes at a price equal to 101 % of the then outstanding principal amounts, plus accrued and unpaid interest.

1 unchanged sentence

Proceeds from the issuance of these Notes may be used for general corporate purposes, which may include funding the repayment or redemption of outstanding debt, share repurchases, ongoing operations, capital expenditures, and possible acquisitions of businesses, assets, or strategic investments.

FY 2025 FORM 10-K

PayPal Holdings, Inc.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS—(Continued)

As of both December 31, 2024 and 2023, we had an outstanding aggregate principal amount of $ 10.6 billion related to the Notes.

As of December 31, 2025 and 2024, we had an outstanding aggregate principal amount of $ 10.9 billion and $ 10.6 billion related to the Notes.

The following table summarizes the Notes outstanding:

7 unchanged sentences

10/1/2029 2.96 % 1,500 1,500

Fixed-rate 2.850 % notes

10/1/2029 2.96 % 1,500 1,500

May 2020 debt issuance:

26 unchanged sentences

6/1/2054 5.66 % 400 400

March 2025 debt issuance:

Floating-rate notes 3/6/2028 5.06 % 450 —

Fixed-rate 4.450 % notes

3/6/2028 4.66 % 450 —

Fixed-rate 5.100 % notes

4/1/2035 5.20 % 600 —

Total term debt

8 unchanged sentences

The effective interest rates for the Notes include interest on the Notes, amortization of debt issuance costs, and amortization of the debt discount.

The interest expense recorded for the Notes, including amortization of the debt discount, debt issuance costs, and debt extinguishment net gains, was $ 366 million, $ 334 million, and $ 290 million for the years ended December 31, 2024, 2023, and 2022, respectively.

The interest expense recorded for the Notes, including amortization of the debt discount and debt issuance costs was $ 421 million, $ 366 million, and $ 334 million for the years ended December 31, 2025, 2024, and 2023, respectively.

FY 2025 FORM 10-K

PayPal Holdings, Inc.

7 unchanged sentences

We may also, subject to the agreement of the applicable lenders and satisfaction of specified conditions, increase the commitments under the revolving credit facility by up to $ 2.0 billion.

Subject to specific conditions, we may designate one or more of our subsidiaries as additional borrowers under the Credit Agreement, provided PayPal Holdings, Inc.

Subject to specific conditions, we may designate one or more of our subsidiaries as additional borrowers under the Credit Agreement, provided that PayPal Holdings, Inc.

guarantees the portion of borrowings made available and other obligations of any such subsidiaries under the Credit Agreement.

2 unchanged sentences

We are obligated to pay interest on loans under the Credit Agreement and other customary fees for a credit facility of this size and type, including an upfront fee and an unused commitment fee based on our debt rating.

Loans under the Credit Agreement will bear interest at either (i) the applicable term benchmark rate plus a margin (based on the Company’s public debt ratings) ranging from 0.750 % to 1.250 %, (ii) the applicable Risk-Free Rate (Sterling Overnight Index Average for loans denominated in pounds sterling and Euro Short-Term Rate for loans denominated in euros) rate plus a margin (based on the Company’s public debt ratings) ranging from 0.750 % to 1.250 %, (iii) the applicable overnight rate plus a margin (based on the Company’s public debt ratings) ranging from 0.750 % to 1.250 % or (iv) a formula based on the prime rate, the federal funds effective rate or the adjusted term Secured Overnight Financing Rate plus a margin (based on the Company’s public debt ratings) ranging from zero to 0.250 %.

Loans under the Credit Agreement will bear interest at either (i) the applicable term benchmark rate plus a margin (based on the Company’s public debt ratings) ranging from 0.750 % to 1.250 %, (ii) the applicable Risk-Free Rate (Sterling Overnight Index Average for loans denominated in pounds sterling and Euro Short-Term Rate for loans denominated in euros) plus a margin (based on the Company’s public debt ratings) ranging from 0.750 % to 1.250 %, (iii) the applicable overnight rate plus a margin (based on the Company’s public debt ratings) ranging from 0.750 % to 1.250 %, or (iv) a formula based on the prime rate, the federal funds effective rate or the adjusted term Secured Overnight Financing Rate plus a margin (based on the Company’s public debt ratings) ranging from zero to 0.250 %.

Subject to certain conditions stated in the Credit Agreement, the Company and any subsidiaries designated as additional borrowers may borrow, prepay and reborrow amounts under the revolving credit facility at any time during the term of the Credit Agreement.

13 unchanged sentences

The financial covenant requires us to meet a quarterly financial test with respect to a maximum consolidated leverage ratio.

FY 2025 FORM 10-K

PayPal Holdings, Inc.

4 unchanged sentences

Other available facilities

As of December 31, 2024 and 2023, we had short-term borrowings of nil and $ 359 million, respectively, due to bank overdrafts, which were recorded in accrued expenses and other liabilities on our consolidated balance sheets.

The weighted average interest rate on the borrowing was 7.92 % as of December 31, 2023.

We repaid $ 400 million of borrowings due to bank overdrafts during the year ended December 31, 2024.

The total interest expense and fees we recorded related to the borrowings were de minimis.

We also maintain uncommitted credit facilities in various regions throughout the world, which had a borrowing capacity of approximately $ 80 million in the aggregate, as of December 31, 2025 and 2024.

2 unchanged sentences

As of December 31, 2025, substantially all of the borrowing capacity under these credit facilities was available, subject to customary conditions to borrowing.

COMMERCIAL PAPER

In November 2025, we established a commercial paper program that allows us to issue up to $ 5.0 billion of unsecured commercial paper notes (“Commercial Paper Notes”) through private placement using third-party broker-dealers (the “Commercial Paper Program”).

Borrowings under the Commercial Paper Program are supported by the Credit Agreement.

The Company intends to maintain availability under the Credit Agreement in an amount at least equal to the aggregate outstanding borrowings under the Commercial Paper Program.

Net proceeds from the issuance of the Commercial Paper Notes may be used for general corporate purposes.

The maturities of the Commercial Paper Notes may vary but may not exceed 397 days from the date of issuance.

There were $ 200 million outstanding in Commercial Paper Notes as of December 31, 2025, which was recorded in accrued expenses and other current liabilities on our consolidated balance sheet.

FUTURE PRINCIPAL PAYMENTS

As of December 31, 2024, the future principal payments associated with our term debt were as follows (in millions):

As of December 31, 2025, the future principal payments associated with our long-term debt were as follows (in millions):

Thereafter 5,350

Total $ 11,459

FY 2025 FORM 10-K

PayPal Holdings, Inc.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS—(Continued)

NOTE 13— COMMITMENTS AND CONTINGENCIES

5 unchanged sentences

if none of the estimates within that range is a better estimate than any other amount, we accrue the low end of the range.

For those proceedings in which an unfavorable outcome is reasonably possible but not probable, we have disclosed an estimate of the reasonably possible loss or range of losses or we have concluded that an estimate of the reasonably possible loss or range of losses arising directly from the proceeding (i.e., monetary damages or amounts paid in judgment or settlement) are not material.

For those proceedings in which an unfavorable outcome is reasonably possible but not probable, (i) we have disclosed an estimate of the reasonably possible loss or range of losses or (ii) we have concluded that our estimate of the reasonably possible loss or range of losses arising directly from the proceeding (i.e., monetary damages or amounts paid in judgment or settlement) is not material.

If we cannot estimate the probable or reasonably possible loss or range of losses arising from a legal proceeding, we have disclosed that fact.

1 unchanged sentence

With respect to the matters disclosed in this Note 13, we are unable to estimate the possible loss or range of losses that could potentially result from the application of such non-monetary remedies.

PayPal Holdings, Inc.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS—(Continued)

Amounts accrued for legal and regulatory proceedings for which we believe a loss is probable and reasonably estimable were not material for the year ended December 31, 2024.

Amounts accrued for legal and regulatory proceedings for which we believe a loss is probable and reasonably estimable were not material as of December 31, 2025.

Except as otherwise noted for the proceedings described in this Note 13, we have concluded, based on currently available information, that reasonably possible losses arising directly from the proceedings (i.e., monetary damages or amounts paid in judgment or settlement) in excess of our recorded accruals are also not material.

3 unchanged sentences

Regulatory proceedings

PayPal Australia Pty Limited (“PPAU”) self-reported a potential violation to the Australian Transaction Reports and Analysis Centre (“AUSTRAC”) on May 22, 2019.

This self-reported matter relates to PPAU incorrectly filing required international funds transfer instructions over a period of time under the Anti-Money Laundering and Counter-Terrorism Financing Act 2006 (“AML/CTF Act”).

On September 23, 2019, PPAU received a notice from AUSTRAC requiring that PPAU appoint an external auditor (a partner of a firm which is not our independent auditor) to review certain aspects of PPAU’s compliance with its obligations under the AML/CTF Act.

The external auditor was appointed on November 1, 2019.

AUSTRAC had notified PPAU that its enforcement team was investigating the matters reported upon by the external auditor in its August 31, 2020 final report.

As a resolution of this investigation, on March 17, 2023, AUSTRAC’s Chief Executive Officer accepted an enforceable undertaking from PPAU in relation to the self-reported issues.

The enforceable undertaking does not include a monetary penalty.

The entry into and compliance with the enforceable undertaking will not require a change to our business practices in a manner that could result in a material loss, require significant management time, result in the diversion of significant operational resources, or otherwise adversely affect our business.

PPAU is required to deliver an Assurance Action Plan (“AAP”) under the enforceable undertaking to demonstrate that the governance and oversight arrangements following the remedial work completed by PPAU are sustainable and appropriate.

The enforceable undertaking requires PPAU to appoint an external auditor.

The external auditor was appointed on June 22, 2023 to assess and report on the appropriateness, sustainability and efficacy of the actions to be taken under the AAP.

PPAU provided the external auditor’s final report to AUSTRAC on April 16, 2024.

The successful completion of the enforceable undertaking is subject to AUSTRAC’s ultimate review and decision based on the external auditor’s final report.

We cannot predict the outcome of AUSTRAC’s decision.

Any failure to comply with the enforceable undertaking could result in penalties or require us to change our business practices.

In February 2022, we received a Civil Investigative Demand (“CID”) from the Federal Trade Commission (“FTC”) related to PayPal’s practices relating to commercial customers that submit charges on behalf of other merchants or sellers, and related activities.

The CID requests the production of documents and answers to written questions.

We are cooperating with the FTC in connection with this CID.

In August 2025, we received an additional CID investigating whether deceptive schemes and other unlawful activities by merchants using PayPal’s platform were facilitated or furthered by the Company’s onboarding, due diligence, and other practices.

The CIDs request the production of documents and answers to written questions, as well as other information.

We are cooperating with the FTC in connection with these CIDs.

In January 2023, we received notice of an administrative proceeding and a related request for information from the German Federal Cartel Office (“FCO”) related to terms in PayPal (Europe) S.à.r.l.

4 unchanged sentences

We are cooperating with the CFPB in connection with these CIDs.

In November 2023, we received a subpoena from the U.S.

SEC Division of Enforcement relating to PayPal USD stablecoin.

The subpoena requests the production of documents.

We are cooperating with the SEC in connection with this request.

PayPal Holdings, Inc.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS—(Continued)

In August 2024, we received a CID from the CFPB related to PayPal Credit.

2 unchanged sentences

We are cooperating with the CFPB in connection with this CID.

FY 2025 FORM 10-K

PayPal Holdings, Inc.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS—(Continued)

Legal proceedings

10 unchanged sentences

The PPH Securities Action seeks unspecified compensatory damages on behalf of the putative class members.

Defendants have filed a motion to dismiss the PPH Securities Action.

Defendants filed a motion to dismiss the PPH Securities Action.

On January 29, 2025, the Court dismissed all of the claims without prejudice.

The lead plaintiff has until March 17, 2025 to file an amended complaint.

On March 17, 2025, the lead plaintiff filed an amended complaint.

Defendants have filed a motion to dismiss the amended complaint.

On November 2, 2022, a putative shareholder derivative action captioned Shah v.

12 unchanged sentences

The Derivative Actions allege claims for breach of fiduciary duty, aiding and abetting breach of fiduciary duty, unjust enrichment, waste of corporate assets, gross mismanagement and violations of the Exchange Act, and seek to recover damages on behalf of the Company.

The Shah and Nelson Actions have been stayed pending further developments in the PPH Securities Action.

The Derivative Actions have been stayed pending further developments in the PPH Securities Action.

On December 20, 2022, a civil lawsuit captioned State of Hawai‘i, by its Office of Consumer Protection, v.

4 unchanged sentences

On July 14, 2023, the court denied Defendants’ motion to dismiss the complaint.

Trial is scheduled to begin in October 2025.

PayPal Holdings, Inc.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS—(Continued)

We executed a final settlement in this matter on December 17, 2025.

General matters

4 unchanged sentences

Intellectual property claims, whether meritorious or not, are time-consuming and costly to defend and resolve, could require expensive changes in our methods of doing business, or could require us to enter into costly royalty or licensing agreements on unfavorable terms or make substantial payments to settle claims or to satisfy damages awarded by courts.

FY 2025 FORM 10-K

PayPal Holdings, Inc.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS—(Continued)

From time to time, we are involved in other disputes or regulatory inquiries that arise in the ordinary course of business, including suits by our consumers (individually or as class actions), merchants or regulators alleging, among other things, improper disclosure of our prices, rules, or policies, that our practices, prices, rules, policies, or user, product, business or merchant agreements violate applicable law, or that we have acted unfairly or not acted in conformity with such prices, rules, policies, or agreements.

In addition to these types of disputes and regulatory inquiries, our operations are also subject to regulatory and legal review and challenges that may reflect the increasing global regulatory focus to which the payments industry is subject and, when taken together with other regulatory and legislative action, such actions could result in the imposition of costly new compliance burdens on our business and customers and may lead to increased costs and decreased transaction volume and revenue.

In addition to these types of disputes and regulatory inquiries, our operations are also subject to regulatory and legal review and challenges that may reflect the increasing global regulatory focus and scrutiny to which the payments industry is subject and, when taken together with other regulatory and legislative action, such actions could result in the imposition of costly new compliance burdens on our business and customers and may lead to increased costs and decreased transaction volume and revenue.

Further, the number and significance of these disputes and inquiries are increasing as our business has grown and expanded in scale and scope, including the number of active accounts and payments transactions on our platform, the range and increasing complexity of the products and services that we offer, and our geographical operations.

7 unchanged sentences

These indemnification provisions generally include indemnity for other types of third-party claims, which may be related to intellectual property rights, confidentiality, willful misconduct, data privacy obligations, and certain breach of contract claims, among others.

These indemnification provisions generally also include indemnity to our payments processors in the event of card association fines against the processor arising out of conduct by us or our customers.

These indemnification provisions generally also include indemnity to our payments processors arising out of conduct by us or our customers, including in the event of card association fines or other damages incurred by the processor.

It is not possible to determine the maximum potential loss under these indemnification provisions due to our limited history of prior indemnification claims and the unique facts and circumstances involved in each particular situation.

5 unchanged sentences

We have agreed, under certain circumstances, to indemnify the chartered financial institution and its assignee of a portion of these loans in connection with the services provided for loans made under this program.

PayPal Holdings, Inc.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS—(Continued)

As part of the agreement to sell a portion of our consumer installment receivables portfolio, in certain circumstances such as breaches in loan warranties, we may be required to indemnify the global investment firm that purchased the loans or repurchase the loans.

As part of the agreements to sell certain loans receivable portfolios, in certain circumstances such as breaches in loan warranties, we may be required to indemnify the third-party investors that purchased the loans or repurchase the loans.

The estimate of the maximum potential amount of future payments we may be required to make is equal to the current outstanding balances of the loans sold;

1 unchanged sentence

As of December 31, 2025 and 2024, the current outstanding balances of the loans sold was $ 3.8 billion and $ 2.9 billion, respectively.

The terms of the indemnification align to the maturities of the loans sold.

The term of the indemnification obligations align to the maturities of the loans sold.

To date, no significant costs have been incurred, either individually or collectively, in connection with our indemnification provisions.

FY 2025 FORM 10-K

PayPal Holdings, Inc.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS—(Continued)

OFF-BALANCE SHEET ARRANGEMENTS

3 unchanged sentences

Our protection programs help protect both consumers and merchants from financial loss resulting from, among other things, counterparty non-performance.

These programs are designed to promote confidence on the part of both consumers, who will be reimbursed in certain circumstances, such as not receiving their purchased item in the condition significantly as described, as well as merchants, who will receive payment in certain circumstances, such as establishing proof of shipment or delivery of an item to the customer.

These protection programs are considered assurance-type warranties under applicable accounting standards for which we estimate and record associated costs in transaction and credit losses during the period the payment transaction is completed.

These programs are designed to promote confidence on the part of both consumers, who will be reimbursed in certain circumstances, such as not receiving their purchased eligible item in the condition significantly as described, as well as merchants, who will receive payment in certain circumstances, such as establishing proof of shipment or delivery of an eligible item to the customer.

These protection programs are considered assurance-type warranties under applicable accounting standards for which we estimate associated costs within the allowance for transaction losses.

Our protection programs may result in negative customer balances when there are insufficient funds in a customer’s PayPal account to cover charges applied for merchant-related chargebacks within the scope of our protection programs.

Negative customer balances can also occur from bank returns and reversals due to insufficient funding sources.

The allowance for negative customer balances represents our estimate of current expected credit losses on negative customer balances.

At December 31, 2025 and 2024, the allowance for transaction losses was $ 73 million and $ 86 million, respectively.

5 unchanged sentences

Provision (1)

Realized losses ( 1,218 ) ( 1,313 )

Realized losses and charge-offs

( 1,487 ) ( 1,218 )

Recoveries (2)

Ending balance $ 344 $ 342

(1) Changes in estimates for the prior period provision related to the allowance for transaction losses are not material and are aggregated with current period provision.

(2) Recoveries are only relevant for the allowance for negative customer balances.

FY 2025 FORM 10-K

PayPal Holdings, Inc.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS—(Continued)

NOTE 14— STOCK REPURCHASE PROGRAMS

NOTE 14— STOCKHOLDERS’ EQUITY

STOCK REPURCHASE PROGRAMS

In July 2018, our Board of Directors authorized a stock repurchase program that provided for the repurchase of up to $ 10.0 billion of our common stock, with no expiration from the date of authorization.

2 unchanged sentences

In February 2025, our Board of Directors authorized an additional stock repurchase program that provides for the repurchase of up to $ 15.0 billion of our common stock, with no expiration from the date of authorization.

This program became effective in the fourth quarter of 2025 upon completion of the June 2022 stock repurchase program.

Our stock repurchase programs are intended to offset the impact of dilution from our equity compensation programs and, subject to market conditions and other factors, may also be used to make opportunistic repurchases of our common stock to reduce outstanding share count.

3 unchanged sentences

During the year ended December 31, 2025, we repurchased approximately 86 million shares of our common stock for approximately $ 6.0 billion at an average cost of $ 69.94 , excluding excise tax.

These shares were purchased in the open market under our stock repurchase programs authorized in June 2022 and February 2025.

As of December 31, 2025, a total of approximately $ 13.9 billion remained available for future repurchases of our common stock under our February 2025 stock repurchase program.

During the year ended December 31, 2024, we repurchased approximately 92 million shares of our common stock for approximately $ 6.0 billion at an average cost of $ 65.55 , excluding excise tax.

These shares were purchased in the open market under our stock repurchase program authorized in June 2022.

As of December 31, 2024, a total of approximately $ 4.9 billion remained available for future repurchases of our common stock under our June 2022 stock repurchase program.

The Inflation Reduction Act of 2022 imposed a nondeductible 1% excise tax on the net value of certain stock repurchases made after December 31, 2022.

Beginning in the first quarter of 2023, we have reflected the applicable excise tax in treasury stock on our consolidated balance sheets.

During the years ended December 31, 2024 and 2023, we recorded $ 50 million and $ 44 million in excise tax within treasury stock on our consolidated balance sheets, respectively.

The payable associated with the excise tax is a non-cash financing activity which is not reflected on the consolidated statement of cash flows until settled.

During the year ended December 31, 2023, we repurchased approximately 74 million shares of our common stock for approximately $ 5.0 billion at an average cost of $ 67.72 , excluding excise tax.

1 unchanged sentence

As of December 31, 2023, a total of approximately $ 10.9 billion remained available for future repurchases of our common stock under our June 2022 stock repurchase program.

During the year ended December 31, 2022, we repurchased approximately 41 million shares of our common stock for approximately $ 4.2 billion at an average cost of $ 103.47 .

These shares were purchased in the open market under our stock repurchase program authorized in July 2018.

As of December 31, 2022, a total of approximately $ 861 million and $ 15.0 billion remained available for future repurchases of our common stock under our July 2018 and June 2022 stock repurchase programs, respectively.

During the years ended December 31, 2025 and 2024, we recorded $ 51 million and $ 50 million in excise tax within treasury stock on our consolidated balance sheets, respectively.

The payable associated with the excise tax is a non-cash financing activity which is not reflected on the consolidated statement of cash flows until settlement.

Shares of common stock repurchased for the periods presented were recorded as treasury stock for the purposes of calculating net income (loss) per share and were accounted for under the cost method.

No repurchased shares of common stock have been retired.

DIVIDEND PROGRAM

In October 2025, the Company’s Board of Directors declared a cash dividend of $ 0.14 per share on our common stock, totaling approximately $ 130 million.

The dividend was payable on December 10, 2025, to stockholders of record of our common stock as of the close of business on November 19, 2025.

FY 2025 FORM 10-K

PayPal Holdings, Inc.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS—(Continued)

NOTE 15— STOCK-BASED AND EMPLOYEE SAVINGS PLANS

2 unchanged sentences

2015 Equity Incentive Award Plan (the “Plan”), equity awards, including restricted stock units (“RSUs”), restricted stock awards, performance-based restricted stock units (“PBRSUs”), stock options, deferred stock units, and stock payments, may be granted to our directors, officers, and employees.

In May 2024, our stockholders approved the authorization of an additional 20 million shares to the Plan.

In June 2025, our stockholders approved the authorization of an additional 15 million shares to the Plan.

At December 31, 2025, approximately 75 million shares were authorized under the Plan and approximately 45 million shares were available for future grant.

Shares issued as a result of stock option exercises and the release of stock awards were funded primarily with the issuance of new shares of common stock.

PayPal Holdings, Inc.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS—(Continued)

RSUs are granted to eligible employees under the Plan.

RSUs issued prior to January 1, 2022 generally vest in equal annual installments over a period of three years .

RSUs issued on or after January 1, 2022 generally vest over three years at a rate of 33 % after one year , then in equal quarterly installments thereafter.

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Depending on the probability of achieving the pre-established performance targets, the number of PBRSUs with only a performance condition issued could range from 0 % to 200 % of the target amount.

All stock options under the Plan were assumed in connection with acquisitions on the same terms and conditions (including vesting) applicable to such acquired companies’ equity awards.

The cost of stock options was determined using the Black-Scholes option pricing model.

EMPLOYEE STOCK PURCHASE PLAN

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As of December 31, 2025, approximately 39 million shares were reserved for future issuance under the ESPP.

FY 2025 FORM 10-K

PayPal Holdings, Inc.

5 unchanged sentences

Outstanding at January 1, 2025 31,288 $ 67.35

Awarded and assumed (1)

22,329 $ 70.92

( 15,923 ) $ 67.55

Forfeited/cancelled

( 5,937 ) $ 72.39

1 unchanged sentence

Expected to vest 27,499

(1) Includes approximately 1.1 million of additional PBRSUs issued during 2024 due to the achievement of company performance metrics on awards granted in previous years.

During the years ended December 31, 2024, 2023, and 2022, the aggregate intrinsic value of RSUs and PBRSUs vested under the Plan was $ 1.1 billion, $ 752 million, and $ 935 million, respectively.

The aggregate intrinsic value of RSUs and PBRSUs vested under the Plan was $ 1.1 billion for both December 31, 2025 and 2024 and $ 752 million for December 31, 2023.

In the year ended December 31, 2025, the Company granted 1.6 million PBRSUs with a three-year performance period.

In the year ended December 31, 2024, the Company granted 1.9 million PBRSUs with a three-year performance period.

In the year ended December 31, 2023, the Company granted 2.3 million PBRSUs with a one-year performance period (fiscal 2023), which became fully vested following the completion of the performance period in February 2024 ( one year from the annual incentive award cycle grant date), and 1.8 million PBRSUs with a three-year performance period.

STOCK OPTION ACTIVITY

The following table summarizes stock option activity of our employees under the Plan for the year ended December 31, 2024:

Price Weighted

Term (Years) Aggregate

Intrinsic Value

(In thousands, except per share amounts and years)

Outstanding at January 1, 2024 72 $ 15.18

Exercised ( 34 ) $ 16.50

Forfeited/expired/cancelled ( 2 ) $ 11.19

Outstanding at December 31, 2024 36 $ 14.08 2.92 $ 2,660

Expected to vest — $ 114.09 6.28 $ 1

Options exercisable 36 $ 13.90 2.92 $ 2,659

(1) “—” Denotes shares of less than a thousand.

No options were granted or assumed during the years ended December 31, 2024 and 2023.

The weighted average grant date fair value of options assumed from acquisitions during the year ended December 31, 2022 was $ 147.92 .

The aggregate intrinsic value was calculated as the difference between the exercise price of the underlying options and the quoted price of our common stock at December 31, 2024.

During the years ended December 31, 2024, 2023, and 2022, the aggregate intrinsic value of options exercised under the Plan was $ 2 million, $ 4 million, and $ 16 million, respectively, determined as of the date of option exercise.

At December 31, 2024, substantially all outstanding options were in-the-money.

STOCK-BASED COMPENSATION EXPENSE

Stock-based compensation expense for the Plan is measured based on their estimated fair value at the time of grant, and recognized over the award’s vesting period.

PayPal Holdings, Inc.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS—(Continued)

T he impact on our results of operations of recording stock-based compensation expense under the Plan for the years ended December 31, 2024, 2023, and 2022 was as follows:

Stock-based compensation expense for the Plan is measured based on the estimated fair value of shares at the time of grant and recognized over the award’s vesting period.

T he following table summarizes the impact of stock-based compensation expense under the Plan on our results of operations for the years ended December 31, 2025, 2024, and 2023:

Year Ended December 31,

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Income tax benefit on total stock-based compensation expense $ 227 $ 238 $ 260

$ 238 $ 260 $ 209

Income tax benefit realized related to awards vested or exercised $ 237 $ 205 $ 136

$ 205 $ 136 $ 182

As of December 31, 2025, there was approximately $ 1.4 billion of unearned stock-based compensation that is expected to be recognized over a weighted average period of 1.87 years.

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Future unearned stock-based compensation will increase to the extent we grant additional equity awards, change the mix of equity awards we grant, or assume unvested equity awards in connection with acquisitions.

FY 2025 FORM 10-K

PayPal Holdings, Inc.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS—(Continued)

EMPLOYEE SAVINGS PLANS

14 unchanged sentences

Income before income taxes $ 6,292 $ 5,329 $ 5,411

PayPal Holdings, Inc.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS—(Continued)

The income tax expense was composed of the following:

5 unchanged sentences

Foreign 893 502 657

Total current portion of income tax expense (benefit)

Total current portion of income tax expense

$ 842 $ 951 $ 1,833

5 unchanged sentences

$ 1,059 $ 1,182 $ 1,165

The following is a reconciliation of the difference between the effective income tax rate and the federal statutory rate:

FY 2025 FORM 10-K

PayPal Holdings, Inc.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS—(Continued)

The following is a reconciliation of the difference between the effective income tax rate and the federal statutory tax rate:

Year Ended December 31, 2025

(in millions) %

Tax provision at the U.S.

federal statutory rate

$ 1,321 21.0 %

State and local income tax, net of federal income tax effect (1)

( 22 ) ( 0.3 ) %

Foreign tax effects:

Statutory tax rate difference between Singapore and the U.S.

( 155 ) ( 2.5 ) %

Incentive agreement

( 466 ) ( 7.4 ) %

Qualified domestic minimum top-up tax

Other foreign jurisdictions

Effect of cross-border tax laws

Research and development

( 99 ) ( 1.6 ) %

Changes in valuation allowances (2)

Nontaxable or nondeductible items

Changes in unrecognized tax benefits (3)

Internal legal entity restructuring (2)

( 518 ) ( 8.2 ) %

Other rate drivers 7 0.1 %

Income tax expense and effective income tax rate

$ 1,059 16.8 %

(1) The state that contributed to the majority (greater than 50%) of the tax effect in this category was California.

(2) “Internal legal entity restructuring” includes $ 299 million of U.S.

tax attributes generated, which are not more-likely-than-not to be realized, and is offset in “Changes in valuation allowances.”

(3) PayPal made a policy election to aggregate changes in unrecognized tax benefits for all jurisdictions in this line item.

As previously disclosed for the years ended December 31, 2024 and 2023, prior to the adoption of ASU 2023-09, the following is a reconciliation of the difference between the effective income tax rate and the federal statutory tax rate:

Year Ended December 31,

Federal statutory rate 21.0 % 21.0 %

5 unchanged sentences

Change in valuation allowances 0.6 % — %

Intra-group transfer of intellectual property — % — % 10.0 %

Other 0.5 % 3.2 %

Effective income tax rate 22.2 % 21.5 %

FY 2025 FORM 10-K

PayPal Holdings, Inc.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS—(Continued)

The following table presents supplemental cash flow information related to income taxes paid (net of refunds received):

Year Ended December 31, 2025

(In millions)

US state and local:

Luxembourg 96

Total cash taxes paid, net of refunds received

Deferred tax assets and liabilities are recognized for the future tax consequences of differences between the carrying amounts of assets and liabilities and their respective tax basis using enacted tax rates in effect for the year in which the differences are expected to reverse.

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Deferred tax assets:

Net operating loss and credit carryforwards $ 265 $ 305

Tax attribute carryforwards $ 911 $ 265

Accruals and allowances

1 unchanged sentence

Stock-based compensation 83 93

Net unrealized losses 1 36

Safeguarded crypto liabilities

Capitalized research and development

1 unchanged sentence

Valuation allowance (1)

Net deferred tax assets $ 2,768 $ 2,772

( 736 ) ( 240 )

Total deferred tax assets, net of valuation allowance

$ 1,798 $ 1,998

Deferred tax liabilities:

3 unchanged sentences

Net unrealized gains ( 119 ) ( 97 )

Safeguarded crypto assets

( 111 ) ( 74 )

( 101 ) ( 161 )

Total deferred tax liabilities ( 545 ) ( 500 )

Net deferred tax assets $ 1,253 $ 1,498

As of December 31, 2024, our foreign net operating loss carryforwards for income tax purposes were approximately $ 733 million, and certain of these amounts are subject to an annual limitation.

(1) For the year ended December 31, 2025, we had an increase in our valuation allowance of $ 496 million, primarily driven by an increase in our U.S.

federal tax attributes generated as part of an internal legal entity restructuring, as well as an increase in our U.S.

state tax attributes due to a change in our state apportionment rates, which are not more-likely-than-not to be realized.

As of December 31, 2025, our net foreign net operating loss carryforwards for income tax purposes were approximately $ 184 million, and certain of these amounts are subject to an annual limitation.

If not utilized, a portion of these losses will begin to expire in 2026.

It is more likely than not that most of these net operating loss carryforwards will not be realized;

therefore, we have recorded a valuation allowance against them.

As of December 31, 2024, our California research and development tax credit carryforwards for income tax purposes were approximately $ 270 million, which may be carried forward indefinitely.

As of December 31, 2025, our net U.S.

Federal capital loss carryforward was approximately $ 299 million, which will expire in 2030.

As of December 31, 2025, our net California research and development tax credit carryforwards for income tax purposes were approximately $ 141 million, which may be carried forward indefinitely.

As of December 31, 2025, our Federal corporate alternative minimum tax credit carryforward was approximately $ 144 million, which may be carried forward indefinitely.

It is more likely than not that most of these net operating loss, capital loss, and research and development tax credit carryforward deferred tax assets will not be realized and a valuation allowance has been recorded against these assets.

Repatriation of our foreign earnings for use in the U.S.

1 unchanged sentence

as a result, the corresponding deferred tax liability we have accrued is not material.

FY 2025 FORM 10-K

PayPal Holdings, Inc.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS—(Continued)

We benefit from agreements concluded in certain jurisdictions, most significantly Singapore.

1 unchanged sentence

We review our compliance on an annual basis to ensure we continue to meet our obligations under this agreement.

This agreement resulted in tax savings of approximately $ 473 million, $ 441 million, and $ 510 million in 2024, 2023, and 2022, respectively.

This agreement, after factoring in any qualified domestic minimum top-up tax in 2025 onward, resulted in tax savings of approximately $ 96 million, $ 473 million, and $ 441 million in 2025, 2024, and 2023, respectively.

Excluding the effect of U.S.

and foreign tax legislation the benefit of this agreement on our net income (loss) per share (diluted) was approximately $ 0.46 , $ 0.40 , and $ 0.44 in 2024, 2023, and 2022, respectively.

and foreign tax legislation, the benefit of this agreement on our diluted net income (loss) per share was approximately $ 0.10 , $ 0.46 , and $ 0.40 in 2025, 2024, and 2023, respectively.

These results may further vary based on our overall tax profile.

The Organization for Economic Co-operation and Development (“OECD”) has published model rules, which include the implementation of a global minimum tax rate of 15%, commonly referred to as Pillar Two.

Certain countries in which we do business have enacted implementing legislation effective January 1, 2024.

Based on the Company’s analysis of such enacted legislation for jurisdictions in which we operate, there was not a material impact to the Company’s 2024 income tax provision.

PayPal Holdings, Inc.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS—(Continued)

On July 4, 2025, the One Big Beautiful Bill Act (the “Act”) was enacted into law in the U.S., with certain provisions of the Act effective in 2025 and other provisions becoming effective in 2026 and beyond.

The provisions of the Act effective in 2025 were not material and have been reflected in our results, as applicable.

The following table reflects changes in unrecognized tax benefits for the periods presented below:

11 unchanged sentences

For the years ended December 31, 2025, 2024, and 2023, we recognized net interest and penalties of $ 73 million, $ 50 million, and $ 151 million, respectively, related to uncertain tax positions in income tax expense.

This expense is reflected in the “Other” line of our effective income tax rate schedule.

This expense is reflected in the “Changes in unrecognized tax benefits” line of our effective income tax rate schedule for 2025 and “Other” line of our effective income tax rate schedule for 2024 and 2023.

The amount of interest and penalties accrued as of December 31, 2025 and 2024 was approximately $ 637 million and $ 556 million, respectively.

3 unchanged sentences

The material jurisdictions in which we are subject to examination by tax authorities for tax years after 2012 primarily include the U.S.

(Federal and California), India, Israel, and Singapore.

(Federal and California), India, Singapore, and Israel.

We believe that adequate amounts have been reserved for any adjustments that may ultimately result from our open examinations.

2 unchanged sentences

These adjustments or settlements could result in changes to our unrecognized tax benefits related to positions on prior year tax filings.

Given the number of years remaining subject to examination and the number of matters being examined, we were unable to estimate the full range of possible adjustments to the balance of gross unrecognized tax benefits.

In connection with our separation from eBay in 2015, we entered into various agreements that govern the relationship between the parties going forward, including a tax matters agreement.

Under the tax matters agreement, eBay is generally responsible for all additional taxes (and will be entitled to all related refunds of taxes) imposed on eBay and its subsidiaries (including subsidiaries that were transferred to PayPal pursuant to the separation) arising after the separation date with respect to the taxable periods (or portions thereof) ended on or prior to July 17, 2015, except for those taxes for which PayPal has reflected an unrecognized tax benefit in its financial statements on the separation date.

Under the tax matters agreement, eBay is generally responsible for all additional taxes (and will be entitled to all related refunds of taxes) imposed on eBay and its subsidiaries (including subsidiaries that were transferred to PayPal pursuant to the separation) arising after the separation date with respect to the taxable periods (or portions thereof) ended on or prior to July 17, 2015, except for those taxes for which PayPal reflected an unrecognized tax benefit on the separation date.

FY 2025 FORM 10-K

PayPal Holdings, Inc.

2 unchanged sentences

RESTRUCTURING

During the first quarter of 2024, management initiated a global workforce reduction intended to streamline operations, focus resources on core strategic priorities, and improve our cost structure.

The associated restructuring charges during the year ended December 31, 2024 were $ 307 million, and included employee severance and benefits costs and stock-based compensation expense, all of which were substantially completed by the fourth quarter of 2024.

The restructuring charges associated with the following plans were recorded in “restructuring and other” on our consolidated statements of income.

Accrued restructuring liabilities were included in “accrued expenses and other current liabilities” on our consolidated balance sheets.

During the second quarter of 2025, management undertook a large-scale initiative (the “2Q 2025 Plan”) to reengineer our existing technology infrastructure to improve scalability, reduce network latency, decrease operational costs, and optimize our workforce.

The 2Q 2025 Plan is a transformative unified program designed to streamline operations and includes exiting certain data centers to migrate to more efficient cloud based solutions.

The 2Q 2025 Plan is expected to be executed over a period of 18 to 42 months with the workforce component to be substantially completed in 2027 and the technology infrastructure component to be substantially completed in 2028.

The associated restructuring charges during the year ended December 31, 2025 were $ 102 million, consisting of $ 96 million in employee severance and benefits costs and $ 6 million in other restructuring costs.

In connection with this restructuring, we expect to incur employee severance and benefits costs of approximately $ 90 million to $ 100 million, asset impairment and accelerated depreciation charges of approximately $ 40 million to $ 60 million, and other restructuring costs of approximately $ 110 million to $ 140 million over the term of the 2Q 2025 Plan.

Other restructuring costs relate to process re-engineering and one-time migration to cloud solutions and consist of contractor costs, consulting fees, and prepaid software and maintenance costs without future economic benefit.

The timing of activities and cost estimates continue to be developed and are subject to change.

The following table summarizes the restructuring reserve activity during the year ended December 31, 2025:

Employee Severance and Benefits Costs Other Restructuring Costs

(In millions)

Accrued liability as of January 1, 2025

Payments ( 44 ) — ( 44 )

Accrued liability as of December 31, 2025

$ 52 $ 6 $ 58

During the first quarter of 2025, management initiated a workforce reduction to ensure compliance with a new regulation impacting operations in an international market.

The associated restructuring charges during the year ended December 31, 2025 were $ 36 million and included employee severance and benefits costs, which was completed in the third quarter of 2025.

The following table summarizes the restructuring reserve activity during the year ended December 31, 2025:

Employee Severance and Benefits Costs

3 unchanged sentences

Accrued liability as of December 31, 2025

(1) Excludes stock-based compensation expense of $ 100 million.

(2) Accrued restructuring liability is included in “accrued expenses and other current liabilities” on our consolidated balance sheets.

FY 2025 FORM 10-K

PayPal Holdings, Inc.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS—(Continued)

During the first quarter of 2024, management initiated a global workforce reduction intended to streamline operations, focus resources on core strategic priorities, and improve our cost structure.

The associated restructuring charges during the year ended December 31, 2024 were $ 307 million, and included employee severance and benefits costs and stock-based compensation expense, which were substantially completed in the fourth quarter of 2024.

During the first quarter of 2023, management initiated a global workforce reduction intended to focus resources on core strategic priorities and improve our cost structure and operating efficiency.

1 unchanged sentence

We primarily incurred employee severance and benefits costs, which were substantially completed by the fourth quarter of 2023.

During the first quarter of 2022, management initiated a strategic reduction of the existing global workforce intended to streamline and optimize our global operations to enhance operating efficiency.

This effort focused on reducing redundant operations and simplifying our organizational structure.

The associated restructuring charges in 2022 were $ 121 million.

We primarily incurred employee severance and benefits costs, as well as associated consulting costs under this strategic reduction.

The strategic actions associated with this plan were substantially completed by the fourth quarter of 2022.

We continue to review our real estate and facility capacity requirements due to our new and evolving work models.

We incurred asset impairment charges of nil in 2024 and $ 61 million and $ 81 million in 2023 and 2022, respectively, due to exiting certain leased properties, which resulted in a reduction of ROU lease assets and related leasehold improvements.

We incurred asset impairment charges of nil in 2025 and 2024, and $ 61 million in 2023 due to exiting certain leased properties, which resulted in a reduction of ROU lease assets and related leasehold improvements.

Additionally, we recognized a gain of $ 17 million due to the sale of an owned property and incurred a loss of $ 14 million related to another owned property held for sale in the year ended December 31, 2023.

During the years ended December 31, 2024 and 2023, approximately $ 129 million and $ 74 million, respectively, of losses were recorded in restructuring and other, which included net loss on sale of loans and interest receivable previously held for sale (inclusive of transactions costs) and fair value adjustments to measure loans and interest receivable, held for sale, at the lower of cost or fair value.

During the years ended December 31, 2025, 2024 and 2023, approximately $ 193 million, $ 129 million and $ 74 million, respectively, of losses were recorded in restructuring and other, which included net loss on sale of loans and interest receivable previously held for sale (inclusive of transaction costs) and fair value adjustments to measure loans and interest receivable, held for sale, at the lower of cost or fair value.

In the fourth quarter of 2023, we completed the sale of Happy Returns and recorded a pre-tax gain of $ 339 million, net of transaction costs, in restructuring and other .

For additional information on the divestiture, see “Note 4—Business Combinations and Divestitures”.

FY 2025 FORM 10-K

PayPal Holdings, Inc.

7 unchanged sentences

2025 2024 2023

(In millions, except for per share amounts)

(In millions)

Net revenues $ 33,172 $ 31,797 $ 29,771

17 unchanged sentences

(1) Includes depreciation and amortization expense.

Total depreciation and amortization expense was $ 1.0 billion, $ 1.1 billion, and $ 1.3 billion for the years ended December 31, 2024, 2023, and 2022.

Total depreciation and amortization expense was $ 1.0 billion for both years ended December 31, 2025 and 2024 and $ 1.1 billion for the year ended December 31, 2023.

There are no reconciling items or adjustments between segment net revenues, net income, total assets and consolidated net revenues, net income, and total assets.

For disclosure of geographical information, please refer to “Note 2—Revenue” and “Note 7—Other Financial Statement Details”.

FY 2025 FORM 10-K

FINANCIAL STATEMENT SCHEDULE

14 unchanged sentences

Year Ended December 31, 2025 $ 461 $ 414 $ ( 336 ) $ 539

FY 2025 FORM 10-K

FORM 10-K SUMMARY

14 unchanged sentences

Officer’s Certificate, dated as of September 26, 2019, pursuant to the Indenture, dated as of September 26, 2019, by and between PayPal Holdings, Inc.

and Wells Fargo Bank, National Association, as Trustee, containing Forms of 2024 Note, 2026 Note, and 2029 Note

and Wells Fargo Bank, National Association, as Trustee, containing Forms of 2026 Note and 2029 Note

8-K 9/26/2019

Officer’s Certificate, dated as of May 18, 2020, pursuant to the Indenture, dated as of September 26, 2019, by and between PayPal Holdings, Inc.

and Wells Fargo Bank, National Association, as Trustee, containing Forms of 2025 Note, 2030 Note, and 2050 Note

and Wells Fargo Bank, National Association, as Trustee, containing Forms of 2030 Note and 2050 Note

8-K 5/18/2020

Officer’s Certificate, dated as of May 23, 2022, pursuant to the Indenture, dated as of September 26, 2019, by and between PayPal Holdings, Inc.

and Wells Fargo Bank, National Association, as Trustee, containing Forms of 2027 Note, 2032 Note, 2052 Note, and 2062 Note

and Computershare Trust Company, N.A.

as successor to Wells Fargo Bank, National Association, as Trustee, containing Forms of 2027 Note, 2032 Note, 2052 Note, and 2062 Note

8-K 5/23/2022

Officer’s Certificate pursuant to the Indenture, dated as of June 9, 2023, containing Forms of Note for 0.813% Notes due 2025, 0.972% Notes due 2026, and 1.240% Notes due 2026

Officer’s Certificate pursuant to the Indenture, dated as of May 28, 2024, containing Forms of Note for 5.150% Notes due 2034 and 5.500% Notes due 2054

Officer’s Certificate, dated as of June 9, 2023, pursuant to the Indenture, dated as of September 26, 2019, by and between PayPal Holdings, Inc.

and Computershare Trust Company, N.A.

as successor to Wells Fargo Bank, National Association, as Trustee, containing Forms of Note for 0.972% Notes due 2026 and 1.240% Notes due 2028

Officer’s Certificate, dated as of May 28, 2024, pursuant to the Indenture, dated as of September 26, 2019, by and between PayPal Holdings, Inc.

and Computershare Trust Company, N.A.

as successor to Wells Fargo Bank, National Association, as Trustee, containing Forms of Note for 5.150% Notes due 2034 and 5.500% Notes due 2054

Officer’s Certificate, dated as of March 6, 2025, pursuant to the Indenture, dated as of September 26, 2019, by and between PayPal Holdings, Inc.

and Computershare Trust Company, N.A.

as successor to Wells Fargo Bank, National Association, as Trustee, containing Forms of Note for Floating Rate Notes due 2028, 4.450% Notes due 2028 and 5.100% Notes due 2035

Tax Matters Agreement by and between eBay Inc.

4 unchanged sentences

2015 Equity Incentive Award Plan, as Amended and Restated

8-K 5/28/2024

PayPal Holdings, Inc.

Amended and Restated Deferred Compensation Plan effective November 6, 2018 10-K 2/7/2019

FY 2025 FORM 10-K

Incorporated by Reference

Number Exhibit Description Filed with this Form 10-K Form Date Filed

PayPal Holdings, Inc.

Executive Change in Control and Severance Plan, as amended and restated, effective as of July 24, 2024

Executive Change in Control and Severance Plan, as amended and restated, effective as of November 24, 2025

Form of Indemnity Agreement between PayPal Holdings, Inc.

4 unchanged sentences

2015 Equity Incentive Award Plan, as amended and restated 10-Q 4/30/2024

Incorporated by Reference

Number Exhibit Description Filed with this Form 10-K Form Date Filed

Form of Global Notice of Grant of Stock Option and Stock Option Agreement under the PayPal Holdings, Inc.

2015 Equity Incentive Award Plan 10-12B/A 5/14/2015

Form of Global Restricted Stock Unit Award Grant Notice and Restricted Stock Unit Award Agreement under the PayPal Holdings, Inc.

2015 Equity Incentive Award Plan, as amended and restated (2026)

Form of Global Performance Based Restricted Stock Unit Award Grant Notice and Performance Based Restricted Stock Unit Award Agreement under the PayPal Holdings, Inc.

2015 Equity Incentive Award Plan, as amended and restated (2026)

Form of Director Annual Award Agreement under the PayPal Holdings, Inc.

8 unchanged sentences

PayPal Holdings, Inc.

2022 Inducement Plan 10-Q 8/3/2022

2022 Inducement Plan S-8

Letter Agreement by and between PayPal Holdings, Inc.

5 unchanged sentences

Morgan Securities Australia Limited, as the Administrative Agents 8-K

Deed of Amendment in relation to Receivables Purchase Agreement dated as of December 12, 2024 and Amended and Restated Receivables Purchase Agreement dated as of June 16, 2023 (as amended and restated as of December 12, 2024), by and between PayPal (Europe) S.à r.l.

et Cie, SCA (as Seller and Receivables Manager), PayPal UK Ltd (as Receivables Manager), Alps Partners S.à r.l.

(as Purchaser), BNY Mellon Corporate Trustee Services Limited (as Security Agent), Avega S.à r.l.

(as Back-Up Receivables Manager Facilitator) and Alps Partners (Holding) S.à r.l.

(as Class C Lender)

Receivables Management Agreement, dated as of June 16, 2023 in the form as amended and restated as of October 13, 2023 by and between PayPal (Europe) S.à r.l.

et Cie, SCA (as Seller and Receivables Manager), Alps Partners S.à r.l.

(as Purchaser), Avega S.à r.l.

(as Back-Up Receivables Manager Facilitator) and Alps Partners (Holding) S.à r.l.

(as Class C Lender) 10-Q 11/2/2023

Deed of Amendment in relation to Receivables Purchase Agreement and the Receivables Management Agreement dated as of December 12, 2023, by and between PayPal (Europe) S.à r.l.

Deed of Amendment and Restatement dated November 11, 2025 in relation to the Receivables Purchase Agreement and the Receivables Management Agreement dated as of December 12, 2023, by and between PayPal (Europe) S.à r.l.

et Cie, SCA (as Receivables Manager and Seller), PayPal UK Ltd (as Receivables Manager), Alps Partners S.à r.l.

2 unchanged sentences

(as Class C Lender)

Deed of Amendment in relation to Receivables Management Agreement dated as of July 8, 2024, by and between PayPal (Europe) S.à r.l.

et Cie, SCA (as Receivables Manager and Seller), PayPal UK Ltd (as Receivables Manager), Alps Partners S.à r.l.

FY 2025 FORM 10-K

Incorporated by Reference

Number Exhibit Description Filed with this Form 10-K Form Date Filed

Receivables Purchase Agreement, dated as of November 11, 2025 by and between PayPal (Europe) S.à r.l.

et Cie, SCA (as Seller and a Receivables Manager), PayPal UK Ltd (as a Receivables Manager and collectively with PayPal (Europe) S.à r.l.

et Cie, SCA, the Receivables Managers), Alps 2.0 Partners S.à r.l.

(as Purchaser), BNY Mellon Corporate Trustee Services limited (as Security Agent), Avega S.à r.l.

(as Back-Up Receivables Manager Facilitator) and Alps 2.0 Partners (Holding) as Class C Lender)

Receivables Management Agreement, dated as of November 11, 2025 by and between PayPal (Europe) S.à r.l.

et Cie, SCA (as Seller and EU Receivables Manager), PayPal UK Ltd (as UK Receivables Manager), Alps 2.0 Partners S.à r.l.

(as Purchaser), Avega S.à r.l.

(as Back-Up Receivables Manager Facilitator) and Alps 2.0 Partners ( Holding) S.à r.l.

5 unchanged sentences

10-K 2/8/2024

Incorporated by Reference

Number Exhibit Description Filed with this Form 10-K Form Date Filed

Offer Letter, dated December 4, 2023, by and between PayPal Holdings, Inc.

6 unchanged sentences

Independent Director Compensation Policy X

Form of Commercial Paper Dealer Agreement between the Company, as issuer, and the applicable Dealer party thereto

PayPal Holdings, Inc.

3 unchanged sentences

Power of Attorney (see signature page) X

Certification of PayPal Holdings, Inc.’s Chief Executive Officer, as required by Section 302 of the Sarbanes-Oxley Act of 2002 X

Certification of PayPal Holdings, Inc.’s Chief Financial Officer, as required by Section 302 of the Sarbanes-Oxley Act of 2002 X

Certification of PayPal Holdings, Inc.’s Chief Executive Officer, as required by Section 906 of the Sarbanes-Oxley Act of 2002 X

Certification of PayPal Holdings, Inc.’s Chief Financial Officer, as required by Section 906 of the Sarbanes-Oxley Act of 2002 X

Certification of PayPal Holdings, Inc.’s Chief Executive Officer and Chief Financial Officer, as required by Section 302 of the Sarbanes-Oxley Act of 2002

Certification of PayPal Holdings, Inc.’s Chief Executive Officer and Chief Financial Officer, as required by Section 906 of the Sarbanes-Oxley Act of 2002

PayPal Holdings, Inc.

8 unchanged sentences

The Registrant agrees to furnish supplementally a copy of any omitted schedule or exhibit to the SEC upon request.

FY 2025 FORM 10-K

Pursuant to the requirements of Section 13 or 15(d) of the Securities Exchange Act of 1934, as amended, the Registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized, on February 3, 2026.

PayPal Holdings, Inc.

/s/ Alex Chriss

President, Chief Executive Officer and Director

/s/ Jamie Miller

Interim President and Chief Executive Officer and Executive Vice President, Chief Financial and Operating Officer

POWER OF ATTORNEY

KNOW ALL PERSONS BY THESE PRESENTS, that each person whose signature appears below constitutes and appoints Alex Chriss, Jamie Miller, Bimal Patel, Brian Y.

KNOW ALL PERSONS BY THESE PRESENTS, that each person whose signature appears below constitutes and appoints Jamie Miller, Bimal Patel, Brian Y.

Yamasaki and Christopher Natali, and each or any one of them, each with the power of substitution, his or her attorney-in-fact, to sign any amendments to this report, with exhibits thereto and other documents in connection therewith, with the Securities and Exchange Commission, hereby ratifying and confirming all that each of said attorneys-in-fact, or his or her substitute or substitutes, may do or cause to be done by virtue hereof.

Pursuant to the requirements of the Securities Exchange Act of 1934, as amended, this report has been signed below by the following persons on behalf of the Registrant and in the capacities indicated on February 3, 2026.

Principal Executive Officer:

Principal Financial Officer:

/s/ Alex Chriss

/s/ Jamie Miller

President, Chief Executive Officer and Director

Executive Vice President, Chief Financial Officer

Principal Executive Officer and Principal Financial Officer:

Principal Accounting Officer:

/s/ Jamie Miller

/s/ Christopher Natali

Christopher Natali

Vice President, Chief Accounting Officer

Additional Directors

/s/ Rodney C.

Interim President and Chief Executive Officer and Executive Vice President, Chief Financial and Operating Officer Senior Vice President, Chief Accounting Officer

/s/ Jonathan Christodoro

Adkins Jonathan Christodoro

Jonathan Christodoro

Director Director

8 unchanged sentences

Director Director

Sarnoff Frank D.

/s/ Deirdre Stanley

Sarnoff Deirdre Stanley

Director Director

Compared sentence by sentence after normalising whitespace, quotation marks, case and digits, so re-formatting and restated figures do not read as changed language. Wording changes appear as one removal and one addition. The current filing and the prior one are authoritative.

What changed 10-K

Item 9A. Controls and Procedures