CEO Alex Chriss said improvements in checkout, artificial intelligence and its Venmo app are "starting to show up in the results."

PayPal (PYPL) stock plunged as the company reported a decline in payment transactions, despite earnings beating on both the top and bottom

"Expectations likely ran ahead of themselves," said Mizuho analyst Dan Dolev in response to the market's initial reaction to PayPal's earnings report. "We are not concerned," Dolev added, noting that PayPal’s "branded button has been consistently growing in line with its major merchant partners."