I would like to introduce you to Mr. Enrique Lores, Independent Board Chair of PayPal Holdings. Mr. Lores, you may begin.
Good morning and welcome to the 2025 Annual Stockholders' Meeting. I am Enrique Lores, Chair of PayPal Holdings Board of Directors. I would like to introduce the other board members who are also participating in today's meeting: Alex Chriss, who also serves as our President and Chief Executive Officer; Joy Chik; Jon athan Christodoro; Carmine Di Sibio; David Dorman; Gail McGovern; Debbie Messemer; Ann Sarnoff, and Frank Yeary. David Moffett is unable to join today's meeting due to a prior conflict. As we have previously disclosed, board member Rod Atkins is not standing for re-election at today's meeting, and we would like to thank Rod for his many contributions over the years. Other members of PayPal's Senior Leadership Team are also present, including Peter Cross, Assistant General Counsel and Assistant Secretary. In addition, a representative of PWC, our independent auditor, is attending the meeting.
Before I turn it over to Peter to conduct the business of the meeting, I want to share a few comments from me on behalf of the Board of Directors. PayPal delivered steady progress during fiscal year 2024, advancing our strategic priorities and introducing innovative experiences that empower consumers and businesses around the globe. This performance reinforced the Board's confidence in management's ability to build on PayPal's strong foundation. We are energized by the opportunities before us and the momentum we are building to transform PayPal from a payments company to a commerce platform. I would now like to call to order the 2025 Annual Stockholders' Meeting. I will be serving as Chair of the Meeting, and Peter Cross will serve as Secretary of the Meeting. I will now turn the meeting over to Peter to begin the formal matters.
Thanks, Enrique. Our Annual Stockholder Meeting is being conducted virtually through a live audio webcast, as we have done each year since becoming an independent public company in 2015. Our virtual meeting format enables stockholders from around the world to attend and participate in our annual meeting. We have also adopted a series of safeguards intended to provide all stockholders the same rights and opportunities to participate in this virtual meeting as they would have at an in-person meeting. As described in our proxy statement, we have established clear processes for submitting and responding to stockholder questions, and members of executive management and the board will be available for questions today. Following this meeting, we will consider feedback from our stockholders on the meeting format and continue to work to improve the meeting experience going forward.
We are conducting this meeting in accordance with our bylaws and the rules of conduct and procedures for this meeting, which are available on the meeting website. The virtual meeting is being recorded and will be available for replay on our investor relations website for 90 days. As a reminder, stockholders attending the virtual meeting can vote their shares online from now through the closing of the polls. By following the instructions provided in the company's proxy materials, you can log into the meeting website as a stockholder and click the "Vote Here" button on the screen. If you have previously voted by proxy and do not wish to change your vote, your vote will be cast as you previously instructed, and no further action is required. We will begin by conducting the formal business of the meeting. After that, we will hold a question-and-answer session.
We have received several questions that were submitted by our stockholders in advance of today's meeting. Stockholders logged into the meeting website will be able to submit questions by typing them into the text box on the meeting website. If you have a question about your customer account or a specific PayPal product, please feel free to send those questions to the following email address: stockholdercustomerquestions1word@paypal.com. Stockholder questions addressed during this meeting, as well as questions that are not addressed due to time constraints, will be posted on our investor relations website and the meeting website as soon as practicable following the meeting. This meeting is held pursuant to the notice of annual meeting that we began mailing on April 21, 2025, to all stockholders of record as of the close of business on April 9, 2025.
We have received an affidavit of mailing from Broadridge Financial Solutions indicating that notice of the meeting has been duly given. A copy of our proxy statement is available on PayPal's investor relations website and the Securities and Exchange Commission's website at www.sec.gov. I would like to introduce Kathy Wieden, our Inspector of Election, who is with us today to certify the voting. The Inspector of Election has confirmed that proxies have been received from approximately 79% of the over 977 million shares of the company's outstanding common stock entitled to vote. I declare that there is a quorum present and that we may proceed with the business of the meeting. The polls are open for voting. We will close the polls after the proposals have been presented. We have six items to be voted on at today's meeting: four management proposals and two stockholder proposals.
The first item is the election of 11 director nominees to the Board of Directors, each to hold office until the 2026 Annual Meeting of Stockholders and until their successors are duly elected and qualified. The nominees for election to the Board of Directors are Joy Chik, Alex Chriss, Jonathan Christodoro, Carmine Di Sibio, David Dorman, Enrique Lores, Gail McGovern, Deborah Messemer, David Moffett, Ann Sarnoff, and Frank Yeary. The second item is a non-binding advisory vote to approve the compensation of our named executive officers. The third item is the amendment and restatement of PayPal's 2015 Equity Incentive Award Plan to increase the number of shares of PayPal common stock reserved for issuance under the equity plan by an additional 15 million shares. The fourth item is the ratification of the appointment of PricewaterhouseCoopers LLP as our independent auditor for fiscal year 2025.
The next two items are stockholder proposals. These are set forth in our proxy statement along with the proponent's supporting statement and our opposition statement. A representative for each proponent will have three minutes to present their stockholder proposal. The fifth item is the consideration of the stockholder proposal submitted by National Center for Public Policy Research regarding the issuance of a report on charitable giving, if properly presented at this meeting. Mr. Stefan Padfield will be presenting the proposal as NCPPR's representative. Operator, please open the line for Mr. Padfield.
Mr. Padfield, your line is now open, and you may proceed.
My name is Stefan Padfield, and I am the Executive Director of the Free Enterprise Project, which is part of the National Center for Public Policy Research. The National Center is the proponent of Proposal 5, which asks PayPal for a report on how PayPal's charitable contributions impact its risks related to discrimination against individuals based on their speech or religious exercise. Allow me to provide just two examples that demonstrate why PayPal should provide this report. First, PayPal is listed by the Human Rights Campaign as a silver partner, which means, according to HRC, that PayPal supports the work of HRC. What is the work of HRC? Among other things, HRC has led coalitions calling on major social media platforms to censor mainstream views on parental rights and human sexuality.
It has advocated for legislation that would pose serious threats to religious freedom, free speech, and the progress women have made toward equality in law and culture. Put plainly, it aggressively advances a gender ideology that proclaims children can be born in the wrong body and men can become women simply by saying magic words like, "I am a woman." Its Corporate Equality Index requires companies to adopt similar stances, and perhaps unsurprisingly, PayPal has scored 100 on the most recent CEI. Second, PayPal prohibits contributions to and denies nonprofit pricing for charities that, in PayPal's determination, promote hate or intolerance.
That might seem like a good thing, but PayPal has shown an unsettling tendency to rely on the Southern Poverty Law Center to interpret these vague terms and has accordingly enforced the terms against mainstream conservative and religious views in other contexts, which is what should be expected from aligning with SPLC because that organization has been criticized across the political spectrum as a partisan progressive hit operation more interested in bludgeoning mainstream political conservative opponents than upholding civil rights. In its opposition statement, PayPal argues that the requested report is unnecessary because PayPal's charitable giving programs are applied without reference to political or religious viewpoints. Quite obviously, this does nothing to address the concern that PayPal excludes conservative organizations by weaponizing the terms hate and intolerance against them without ever explicitly referencing religion or politics.
PayPal further argues that the requested report is also unnecessary because PayPal already has robust governance and disclosure around its corporate charitable giving. However, the issues we identify in our proposal arose under that governance and disclosure regime, so clearly more is required. Regardless of how this vote turns out, dominated as it likely is by conflicted asset managers and proxy advisors, PayPal's board should adopt our proposal if it aims to satisfy its fiduciary duties.
Thank you, Mr. Padfield. The Board of Directors recommends a vote against this stockholder proposal for the reasons set forth in our opposition statement provided in our proxy statement. The sixth item is the consideration of the stockholder proposal submitted by Mr. John Chevedden to reduce the threshold to call special meetings of stockholders if properly presented at this meeting. Operator, please open the line for Mr. Chevedden.
Mr. Chevedden, your line is now open, and you may proceed.
Hello, this is John Chevedden. Proposal six, Special Shareholder Meeting Improvement. Shareholders ask the board to take the necessary steps to amend the governing documents to give the owners of combined 10% of our outstanding common stock the power to call a special shareholder meeting. To make up for a complete lack of a right to act by written consent, we need the right of 10% of shares to call for a special shareholder meeting. Hundreds of major companies provide shareholders with the right to act by written consent. Certain companies that do not provide for a shareholder right to act by written consent have a more reasonable stock ownership threshold to call for a special shareholder meeting. Southwest Airlines is an example of a company that does not provide for shareholder written consent and yet provides for 10% of shares to call for a special shareholder meeting.
This proposal received 47% support at an earlier PayPal annual meeting. A company should immediately adopt a proposal that receives a 47% vote because it takes a lot more shareholder conviction to vote against management opposition than to automatically follow management recommendations on all ballot items. PayPal stock was at $310 in 2021 and is at only $72 now. A special shareholder meeting can be called to help introduce a company to a new strategy. The current 20% ownership threshold based on all shares outstanding to call for a special shareholder meeting makes it difficult for shareholders and potential shareholders to acquire shares to meet the required 20% threshold, which is $12 billion of PayPal stock. The best around a company do not necessarily come from a company's existing shareholders.
Making it less difficult for shareholders to acquire enough shares to call for a special shareholder meeting may be an incentive for the PayPal directors and executives to develop a turnaround strategy on their own. There is no concern that allowing 10% of shares to call for a special shareholder meeting is too easy. It's almost unheard of for any special shareholder meeting called for by shareholders to ever occur at any company, even though a significant number of companies allow 10% of shares to call for a special shareholder meeting. The reason to have this right is that with this right in place, companies are more likely to engage productively with shareholders because shareholders have an alternative ability to call for a special shareholder meeting.
On the other hand, with the widespread use of online shareholder meetings, it's much easier for a company to conduct a special shareholder meeting for important business matters, and PayPal bylaws need to be updated accordingly. Please vote yes, special shareholder meeting improvement proposal six.
Thank you, Mr. Chevedden. The Board of Directors recommends a vote against this stockholder proposal for the reasons set forth in our opposition statement provided in our proxy statement. That concludes the presentation of the items of business that you have been asked to vote on at today's meeting. The polls are now closed, and no additional votes may be submitted. I have received the preliminary voting results from the Inspector of Election based on the proxies received as of the opening of the polls at today's meeting. The preliminary voting results are as follows. First, each of the 11 director nominees has been duly elected. Second, the advisory vote to approve the compensation of our named executive officers has been approved. Third, the amendment and restatement of our 2015 Equity Incentive Award Plan has been approved.
Fourth, the appointment of PricewaterhouseCoopers LLP as our independent auditor for 2025 has been ratified. Finally, the two stockholder proposals were not approved. All votes are subject to final count certified by the Inspector of Election. We will report the final voting results on Form 8-K with the Securities and Exchange Commission within four business days of this meeting. There being no further business to come before the meeting, the 2025 Annual Meeting of Stockholders of PayPal Holdings is now adjourned. We will now do a stockholder question-and-answer session with our President and CEO, Alex Chriss. As a reminder, today's question-and-answer session may contain forward-looking statements that are based on our current expectations, forecasts, and assumptions, and involve risks and uncertainties.
Actual results may differ materially from these forward-looking statements due to various risks and uncertainties about our business, which are described in our filings with the Securities and Exchange Commission, including our annual report on Form 10-K and subsequent quarterly reports on Form 10-Q. We assume no obligation to update any forward-looking statements. With that, let's proceed to the Q&A portion of our agenda. Our first stockholder question for today is, how is PayPal taking advantage of the opportunity in agentic commerce?
Thank you for the question. It's great to be with you all today. This is actually a really, really good question. We believe that agentic commerce represents a paradigm shift in how people shop. Consumers will no longer want to shop just in store and online. They will increasingly want to shop with agents and conversationally. This creates significant opportunity for PayPal. For example, some critical ingredients are missing today from today's LLMs. Agents can't easily verify the merchant or consumer. They need fraud and risk protection on both sides. PayPal is uniquely positioned with our hundreds of millions of consumers and tens of millions of merchants to connect LLMs with merchants. We bring the foundational ingredients of trust and security, as well as a rich data set of preferences and behaviors to enable KYC and KYB with a scaled two-sided network.
In short, at PayPal, we're building a next-generation commerce platform that powers unique, personalized, and rewarding shopping experiences, whether they are online, in your favorite stores, or increasingly through AI agents. We are expanding our products, services, and reach so that consumers can use us everywhere they shop, and moving from a one-size-fits-all experience to personalized experiences that leverage the vast data at our fingertips. This also includes developing a dynamic smart wallet supported by AI capabilities to help consumers make the smartest choice in how they pay with the best rewards every time they shop. We are transforming the company from a payments-only company to an end-to-end strategic commerce partner for our merchants. Underpinning this is our work to converge into a single PayPal platform enabled by AI that unlocks the full potential of PayPal's two-sided network in support of both consumers and merchants.
This strategy is durable, and we are well-positioned to win over the long term. To drive forward this strategy, our teams are focused on executing on our four strategic growth drivers: win checkout, scale Omni and grow Venmo, drive PSP profitability, and scale next-generation growth vectors. AI will help us move faster and deliver better experiences in all of these areas. The future of commerce will have a strong agentic presence, and we're excited about leading the charge. Agentic commerce is about creating seamless, predictive, and highly personalized commerce experiences. As agents begin to shop and pay on behalf of consumers, the companies that enable these capabilities at scale will lead the next wave of innovation. With our trusted brand, two-sided network, and global scale, PayPal is uniquely positioned to lead this shift. We've been actively investing in this future.
Our recent developer days were focused entirely on agentic commerce, convening leading engineering talent and AI companies to develop innovations and make commerce smarter and more delightful. In fact, we launched the first remote MCP server for agentic commerce. Our MCP servers and PayPal Agent Toolkit enable developers to seamlessly integrate with our suite of APIs to build agentic workflows that handle commerce operations intelligently, efficiently, and safely. For example, now Anthropic and OpenAI models can connect to PayPal's remote MCP servers to power commerce. We also recently announced a groundbreaking partnership with Perplexity, where PayPal and Venmo will be integrated as native payment options in their conversational search platform. This is a powerful example of agentic commerce in action, where discovery, decision, and purchase can all happen in one seamless interaction.
These innovations reflect the next step in our mission to revolutionize commerce by making it better, faster, and more personalized for consumers while driving better conversion for merchants. We're intently focused on what's next, executing with discipline and working to create long-term value for our shareholders by positioning ourselves as a leader in the cutting edge of commerce.
Thanks, Alex. The next question is, do you expect that PayPal's global business will be impacted by the rapidly changing tariff and trade policy environment? How is the company preparing to weather any related global macroeconomic uncertainty?
As we continue making progress on PayPal's transformation, we have a strong foundation and multiple growth levers that help us face the rapidly changing environment from a position of strength. To date, consumer spending and the labor market have proven resilient, but it remains to be seen how tariffs and other trading friction will impact global economic activity, consumer spending, and supply chains over time. Regardless, we remain focused on investing in profitable growth and executing our strategy, and I am encouraged by the momentum we are driving. As I shared in our first quarter earnings call at the end of April, we had a strong start to the year, and our strategy is taking hold. Even with that strong start, taking into account uncertainty in the macro environment, we made the decision to maintain our full-year guidance.
This builds in some flexibility for us to navigate through the macroeconomic environments as the year unfolds. I am proud of the PayPal team and the focused execution and innovation we are driving.
Thanks, Alex. The last question we will address today is, why does PayPal include equity compensation as part of its total compensation package?
Thanks for this question. Equity compensation is a key component of our compensation program and allows us to effectively compete for, attract, and retain top talent. We operate in a highly competitive market for talent and compete with companies in both the technology and financial sectors. Our compensation committee also believes that equity compensation motivates employees to think and act like owners and creates strong alignment between employees and stockholders.
This concludes the question-and-answer portion of the agenda. As a reminder, stockholder questions addressed during our Q&A session, as well as questions we did not have a chance to address today, will be posted on PayPal's investor relations website and the meeting website. With that, I'll turn it back to Alex for closing remarks.
Thanks, Peter. I want to close by thanking everybody who participated in today's virtual meeting and those stockholders who submitted questions. The PayPal leadership team and I are confident in our ability to execute the strategy we laid out as we enter the year. We have a solid foundation that allows us to navigate uncertain times and invest in our long-term growth. Thanks for joining us and for your continued support. Operator.
This concludes PayPal's 2025 Annual Stockholders Meeting. A replay of the meeting will be available within 24 hours at the website you logged into today. You will now be disconnected from the meeting. Thank you and have a good day.