PayPal sees Q2 transaction margin down 3%

Sees Q2 effective tax rate 19%-21%Says Q2 has most demanding comparison this year. Sees FY26 transaction margin down slightly. Sees FY26 capital expenditures $1B. Sees FY26 adjusted free cash flow at least $6B. Sees FY26 effective tax rate 19%-21%. Says optimizing cost structure through simplification and accelerated AI adoption. Says at least $1.5B gross run-rate savings anticipated over the next two to three years. Says Q1 transaction revenue was driven by growth across the portfolio including PSP, branded checkout and Venmo. Comments and guidance taken from Q1 earnings conference call.