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Four years after leading a charge to make PayPal more nimble by severing it from eBay, investor Carl Icahn is reportedly dissolving his investments in the payment company.
Icahn originally pushed for eBay and PayPal to separate in 2014, arguing eBay's ownership of the payment company made other partners reluctant to collaborate with PayPal out of competitive concerns. Reuters reported the sale of Icahn's stake, as well as dumping his position in AIG.
Billionaire activist investor Carl Icahn attends the Leveraged Finance Fights Melanoma charity event in New York, U.S., on Tuesday, May 19, 2015. Lyft Inc. is worth more than its recent $2 billion valuation, based on the $50 billion value of larger car-hailing rival Uber Technologies Inc., Icahn said, after he led a fundraising round at Lyft last week. Photographer: Victor J. Blue/Bloomberg *** Local Caption *** Carl Icahn
Victor J. Blue/Bloomberg
eBay's management initially pushed back against Icahn by arguing the auction/payment company tie-up was inseparable and noting eBay's earlier attempt to build its own payment engine failed. eBay also reported PayPal received most of its digital payments volume from eBay purchases. eBay initially purchased PayPal in 2002, beginning a long relationship of intertwined services.
But the companies separated later in 2014, with PayPal's management changing its tune by trumpeting an independent PayPal's ability to quickly add new digital transaction technology and merchant partners to compete with Square, Amazon and Walmart as well as pursue its goal of supporting payments inside physical stores.
That take turned out to be correct, as PayPal has reported strong earnings driven by its expanding Venmo P2P app and its Braintree software development business.
PayPal and eBay had retained a nominal payment processing relationship, though that too has begun to wane, as eBay chose to gradually shift processing to Adyen over the next five years.
Icahn, who dumped his eBay position after the PayPal split, has been gradually selling off his PayPal position more recently while adding to his positions in Herbalife and Hertz. Icahn's investing career dates to the 1980s, when he was known as a "corporate raider."
More recently, Icahn, who has served as an advisor to Donald Trump, has been the subject of controversy for moves in the steel industry around the time of U.S. tariff announcements.
The online consumer lender beat revenue expectations in the first quarter, but its net income was dragged down by larger provisions that the company attributed to tariff "uncertainty."
The card processor came up short on expected profits but hit analysts' estimates on revenue in the second quarter of its fiscal 2025. CEO Ryan McInerney said growth in payments volume, cross-border volume and processed transactions were strong even in the face of shaky economic conditions.
At a House subcommittee hearing, Republicans proposed "tailoring" regulations for community banks while Democrats railed against Trump's tariffs and cuts to the Consumer Financial Protection Bureau.
Senate Banking Committee ranking member Elizabeth Warren, D-Mass., and House Financial Services Committee ranking member Maxine Waters, D-Calif., urged the National Credit Union Administration's Inspector general to look into President Trump's removal of two board members.
Rapid deregulation, tariffs and a campaign to dismantle the Consumer Financial Protection Bureau have defined the early days of President Donald Trump's second term for bankers.
