PayPal is reportedly shuttering its San Francisco office as it evaluates its office footprint.

PayPal to Close its San Francisco Office

Several sources say that the payments giant is closing its San Francisco office on 425 Market St. which housed its Xoom business unit.

The payments giant bought Xoom, which is focused on online money transfer technology and services back in 2015.

A person who is familiar with the internal happenings at the company said the employees that worked out of the San Francisco office will work virtually with the ability to work from the company's headquarters office in San Jose, California. It is unclear how many employees are affected by PayPal's decision.

Also Read: PayPal App Update Brings Cash Deposit Support: Now Top-UP PayPal Cash At 7-Eleven

A PayPal spokesperson told TechCrunch that the company is continually looking at and evolving how they can work in the most collaborative and efficient ways possible, and they routinely evaluate their global office footprint and spaces to make sure that their company and their employees are best set up for success.

The pandemic, in particular, has taught the company that there are many ways in which they can work effectively while providing their employees with flexibility.

PayPal said they remain fully committed to the Bay Area and to California and they will continue to hire into and invest in our business and people working within the state.

An individual who commented on a post on the topic on the anonymous professional network, Blind, speculated that the reason behind the move could be San Francisco's Prop C, which levied a tax upon any San Francisco business that earns more than $50 million in gross receipts.

The proceeds are to be directed toward housing and services in an attempt to address the city's challenges with homelessness. Another fintech, Stripe, exited its San Francisco headquarters in 2020 in favor of South San Francisco.

PayPal's move came after it announced that it will start accepting cryptocurrencies.

In 2021, it was also announced that PayPal is becoming a bank.

PayPal's First Quarter Results

Sending money to pay for things through Venmo may be all the rage among smartphone-addicted millennials and Gen Zers.

However, it has not been enough to boost Venmo owner PayPal as of late. The digital payments giant is one of the worst performing stocks in the S&P 500 in 2022. Shares have plunged more than 55% so far in 2022, according to CNN. 

PayPal warned back in February that its sales and new active user growth would be below forecasts. Chief financial officer John Rainey said the combination of inflationary pressures, supply chain issues and the lack of any new stimulus from the federal government was affecting consumer sentiment and spending.

PayPal reported its first quarter results of 2022 after the closing bell on Apr. 27. Sales grew 8% from 2021, slightly ahead of forecasts. Year-over-year earnings dropped sharply and guidance was below estimates. The stock was up a bit after hours.

Making matters worse for PayPal is the fact that Rainey is planning to soon leave the company after seven years there.

The tech firm surprised Wall Street earlier this month when it announced that Rainey is going to become the new CFO at Walmart and will be leaving PayPal at the end of May.

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Written by Sophie Webster