David Marcus, former president of PayPal, has criticised the payments giant, saying it has lost its "mojo", product edge, and ability to compete.
His comments came amid a more than 20% plunge in PayPal's stock, the worst single-day decline in nearly a decade, following disappointing earnings and the removal of CEO Alex Chriss, The Wall Street Journal reported.
"Twelve years of silence is long enough," Marcus began in a post on X. "And today's news makes it clear the pattern I've watched unfold isn't self-correcting."
A few thoughts about PayPal, nearly 12 years after I left.
— David Marcus (@davidmarcus) February 3, 2026
I woke up this morning to dozens of messages from former PayPal colleagues. It pushed me to finally speak up.
I never spoke publicly about the company after I left. Part of that was loyalty to John Donahoe, who gave me…
Marcus led PayPal during a key period when it acquired Braintree and Venmo. He said the company shifted from focusing on products to focusing on short-term financial gains. This, he said, caused PayPal to miss chances in areas like lending, buy-now-pay-later, branded checkout, and new payment networks.
“Over time, the company that had every advantage and could've become the most consequential and relevant payments company of our time, lost its mojo, its product edge, and its ability to compete in a market that's being rewired and reinvented in front of our eyes,” Marcus said.
He also criticised Chriss, saying he lacked experience in payments and removed many leaders with deep knowledge of the business. “Alex [Chriss] came from software, not payments,” he said. “He didn't have the muscle memory for transaction economics, network effects, or settlement infrastructure.”
“He also made an error: clearing out much of the leadership team that understood payments deeply. Executives with years of institutional knowledge departed within his first year,” Marcus added.
Marcus spoke about his departure in 2014. He left despite helping PayPal grow quickly, improve products, and expand through acquisitions. He later joined Facebook after being recruited by Mark Zuckerberg.
“I left PayPal in 2014 because I was deeply frustrated. We had executed a silent turnaround of a company that had lost its soul,” he said.
Marcus praised Bill Ready, former COO, for sustaining momentum, particularly with Venmo, but said PayPal's product edge weakened after Ready left in 2019. COVID-driven e-commerce masked some structural problems temporarily, but strategic missteps accumulated over time.
“During that period, the company made a fundamental miscalculation: it optimised for payment volume instead of margin and differentiation. It leaned into unbranded checkout, where PayPal had the least leverage, instead of branded checkout, where the margin, data, and customer relationship actually lived,” Marcus said.
Marcus pointed to several mistakes: unbranded checkout instead of branded, conservative lending products, defensive BNPL, reliance on old payment networks instead of building new ones, and products like PYUSD that lacked clear use.
He also said acquisitions like Honey and Xoom didn't strengthen PayPal's core business. "None of these were bad companies. They were just a wrong fit for PayPal and became unnecessary distractions," he said.
He added, "I'm not claiming I would have made every call differently. But the pattern, choosing predictability over platform risk, again and again, was a choice, not an inevitability."
The criticism comes as PayPal named Enrique Lores, former CEO of HP, as its new CEO. CFO Jamie Miller will be interim CEO until March 1.
PayPal also reported weak fourth-quarter results, as per Bloomberg. Earnings per share were $1.23 and revenue was $8.68 billion, both below estimates. Growth in PayPal-branded online checkouts slowed to 1 per cent, down from 6 per cent a year earlier. Full-year earnings per share came in at $5.31, slightly below its October forecast.
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