PayPal's new CEO spins off Venmo amid acquisition interest

• Venmo, with nearly 100 million users, is considered PayPal's most valuable and acquirable asset; the company is recruiting a digital banking executive to run the new standalone segment
• Two senior executives are departing amid the changes, and a planned 15% headcount reduction initiated under former CEO Chriss remains in limbo following the leadership transition
• The three new segments include: a standalone Venmo unit, a PayPal-branded merchant and consumer business, and a payment services unit covering Braintree and crypto operations

Summary: PayPal Reorganizes, Spins Off Venmo as Standalone Unit

PayPal's new CEO Enrique Lores is restructuring the company into three distinct business segments, with Venmo becoming a standalone unit for the first time, CNBC has learned exclusively. The reorganization aims to make Venmo's performance easier to track and potentially facilitate its sale.

Key Structural Changes:

• Three new segments: Venmo (standalone), PayPal-branded merchant/consumer business, and payment services (including crypto operations)
• PayPal is recruiting a digital banking executive to lead the Venmo unit
• Two senior executives are departing: leaders from the consumer group and small business division
• New AI transformation group being established

Market Context:

PayPal stock has plummeted approximately 80% since its 2021 pandemic-era peak, significantly underperforming competitors like Apple (up 104%) and Alphabet (up 291%) over the same period. The company has lost ground to rivals including Stripe, Apple, and Shopify in e-commerce payments.

Acquisition Interest:

Bloomberg reported in February 2026 that PayPal has attracted takeover interest from potential bidders, including rival Stripe. Venmo, with nearly 100 million users, is considered PayPal's most valuable and acquirable asset due to strong growth prospects. The company has hired bankers to defend against takeover bids or activist campaigns.

Leadership and Workforce:

Lores, former HP CEO for six years, became PayPal CEO in March, replacing struggling predecessor Alex Chriss. Earlier this year, managers were tasked with identifying 15% headcount reductions, though these cuts remain in limbo following the leadership change.

PayPal is scheduled to report first-quarter results soon.