v3.26.1
FAIR VALUE MEASUREMENT OF ASSETS AND LIABILITIES
 3 Months Ended
Mar. 31, 2026
Fair Value Disclosures [Abstract]  
FAIR VALUE MEASUREMENT OF ASSETS AND LIABILITIES FAIR VALUE MEASUREMENT OF ASSETS AND LIABILITIES
FINANCIAL ASSETS AND LIABILITIES MEASURED AND RECORDED AT FAIR VALUE ON A RECURRING BASIS
The following tables summarize our financial assets and liabilities measured at fair value on a recurring basis as of March 31, 2026 and December 31, 2025:

March 31, 2026
Quoted Prices in
Active Markets for
Identical Assets
(Level 1)
Significant Other
Observable Inputs
(Level 2)
(In millions)
Assets:   
Cash and cash equivalents(1)
U.S. government and agency securities$250 $— $250 
Money market fund48 48 — 
Total cash and cash equivalents298 48 250 
Short-term investments(2):
U.S. government and agency securities395 — 395 
Foreign government and agency securities110 — 110 
Corporate debt securities808 — 808 
Mortgage-backed and asset-backed securities403 — 403 
Commercial paper570 — 570 
Total short-term investments2,286 — 2,286 
Funds receivable and customer accounts(3):
U.S. government and agency securities4,174 — 4,174 
Foreign government and agency securities298 — 298 
Corporate debt securities2,763 — 2,763 
Mortgage-backed and asset-backed securities4,237 — 4,237 
Municipal securities33 — 33 
Commercial paper4,509 — 4,509 
Total funds receivable and customer accounts16,014 — 16,014 
Derivatives(4)
188 — 188 
Long-term investments(2),(5):
U.S. government and agency securities480 — 480 
Corporate debt securities543 — 543 
Mortgage-backed and asset-backed securities1,290 — 1,290 
Marketable equity securities106 106 — 
Total long-term investments2,419 106 2,313 
Total financial assets$21,205 $154 $21,051 
Liabilities:
Derivatives(4)
$60 $— $60 
(1) Excludes cash and cash equivalents of $6.7 billion not measured and recorded at fair value.
(2) Excludes time deposits of $85 million not measured and recorded at fair value.
(3) Excludes cash, time deposits, and funds receivable of $23.5 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 condensed consolidated balance sheets.
(5) Excludes non-marketable equity securities of $1.7 billion measured using the Measurement Alternative or equity method accounting.

December 31, 2025
Quoted Prices in
Active Markets for
Identical Assets
(Level 1)
Significant Other
Observable Inputs
(Level 2)
(In millions)
Assets:   
Cash and cash equivalents(1)
Money market fund$4 $4 $— 
Short-term investments(2):
U.S. government and agency securities443 — 443 
Foreign government and agency securities60 — 60 
Corporate debt securities984 — 984 
Mortgage-backed and asset-backed securities
448 — 448 
Commercial paper350 — 350 
Total short-term investments2,285 — 2,285 
Funds receivable and customer accounts(3):
U.S. government and agency securities3,530 — 3,530 
Foreign government and agency securities371 — 371 
Corporate debt securities2,736 — 2,736 
Mortgage-backed and asset-backed securities
3,831 — 3,831 
Municipal securities98 — 98 
Commercial paper4,265 — 4,265 
Total funds receivable and customer accounts14,831 — 14,831 
Derivatives(4)
20 — 20 
Long-term investments(2), (5):
U.S. government and agency securities400 — 400 
Foreign government and agency securities50 — 50 
Corporate debt securities650 — 650 
Mortgage-backed and asset-backed securities
1,321 — 1,321 
Marketable equity securities180 180 — 
Total long-term investments2,601 180 2,421 
Total financial assets$19,741 $184 $19,557 
Liabilities:
Derivatives(4)
$158 $— $158 
(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 condensed consolidated balance sheets.
(5) Excludes non-marketable equity securities of $1.7 billion measured using the Measurement Alternative or equity method accounting.

Our financial assets classified within Level 1 are valued using quoted prices for identical assets in active markets. 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 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).
As of March 31, 2026 and December 31, 2025, 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).

We elect to account for available-for-sale debt securities denominated in currencies other than the functional currency of our subsidiaries under the fair value option. Election of the fair value option allows us to recognize any gains and losses from fair value changes on such investments in other income (expense), net on the condensed consolidated statements of income (loss) to significantly reduce the accounting asymmetry that would otherwise arise when recognizing the corresponding foreign exchange gains and losses relating to customer liabilities. The following table summarizes the estimated fair value and amortized cost of our available-for-sale debt securities under the fair value option as of March 31, 2026 and December 31, 2025:
 March 31, 2026December 31, 2025
Amortized CostFair ValueAmortized CostFair Value
(In millions)
Funds receivable and customer accounts$600 $598 $621 $620 

The following table summarizes the gains (losses) from fair value changes recognized in other income (expense), net related to the available-for-sale debt securities under the fair value option for the three months ended March 31, 2026 and 2025:
Three Months Ended March 31,
 20262025
(In millions)
Funds receivable and customer accounts$(15)$31 

ASSETS MEASURED AND RECORDED AT FAIR VALUE ON A NON-RECURRING BASIS

The following tables summarize our assets held as of March 31, 2026 and December 31, 2025 for which a non-recurring fair value measurement was recorded during the three months ended March 31, 2026 and the year ended December 31, 2025, respectively:
March 31, 2026
Significant Other
Observable Inputs
(Level 2)
Significant Other Unobservable Inputs (Level 3)
(In millions)
Loans and interest receivable, held for sale$1,287 $1,233 $54 
Non-marketable equity securities measured using the Measurement Alternative(1)
208 117 91 
Total$1,495 $1,350 $145 
(1) Excludes non-marketable equity securities of $1.3 billion accounted for under the Measurement Alternative for which no observable price changes occurred during the three months ended March 31, 2026.

December 31, 2025
Significant Other
Observable Inputs
(Level 2)
Significant Other Unobservable Inputs (Level 3)
(In millions)
Loans and interest receivable, held for sale
$1,223 $1,182 $41 
Non-marketable equity securities measured using the Measurement Alternative(1)
690 679 11 
Total$1,913 $1,861 $52 
(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.
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.

We measure the non-marketable equity securities accounted for under the Measurement Alternative at cost minus impairment, if any, adjusted for observable price changes in orderly transactions for an identical or similar investment in the same issuer. Non-marketable equity securities that have been remeasured during the period based on observable price changes are classified within Level 2 in the fair value hierarchy because we estimate the fair value based on valuation methods which only include significant inputs that are observable, such as the observable transaction price at the transaction date. 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.

FINANCIAL ASSETS AND LIABILITIES NOT MEASURED AND RECORDED AT FAIR VALUE
Our financial instruments, including cash, PayPal USD stablecoin (“PYUSD”), time deposits, certain loans and interest receivable, held for sale, loans and interest receivable, net, notes receivable, commercial paper, and 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 $10.1 billion as of March 31, 2026. 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. If these financial instruments were measured at fair value in the financial statements, cash and PYUSD would be classified as Level 1; time deposits, certain loans and interest receivable, held for sale, 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.