Despite ongoing layoffs and a declining stock price, PayPal is setting its sights on the future. During the company’s first-quarter earnings call, CEO Enrique Lores informed investors that PayPal must “recommit to the fundamentals,” which involves “becoming a technology company again.”

There was no subtlety in the message — PayPal was clearly promoting an AI-driven revival. Lores explicitly stated this, telling analysts on the call that leading companies distinguish themselves through innovation, and now is the moment for PayPal to act. This includes modernizing its technology platform, accelerating its transition to a “cloud-native” environment, and “aggressively adopting AI in our development processes,” according to Lores. He added that these moves would boost developer productivity and reduce time to market. This is a striking acknowledgment from PayPal that it hasn’t fully incorporated AI internally, especially since AI-assisted coding has become a standout area where the technology truly excels. Many other consumer tech companies have quickly embraced AI for coding in recent months; Spotify even announced in February that its top developers haven’t written a single line of code since December. Meanwhile, leading development teams compete by tokenmaxxing — a metric for identifying who within a company is experimenting more with AI, based on the number of AI tokens they consume. PayPal appears to be only now catching up. Lores mentioned that the company has established a new “AI transformation and simplification” team to oversee its enterprise AI strategy. Combined with the planned layoffs — which Lores described as removing layers from PayPal’s organizational structure — the integration of AI-driven processes is expected to generate at least $1.5 billion in cost savings over the next two to three years, he said.

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Last week, the company announced a reorganization that streamlines operations into three segments: checkout solutions and PayPal, consumer financial services (including Venmo), and payment services along with crypto. Additionally, Bloomberg reported on Tuesday that PayPal intends to cut roughly 20% of its workforce over the next two to three years as part of its cost-saving plan, amounting to more than 4,500 jobs. Further savings will come from PayPal’s AI adoption initiatives, as company executives detailed on the call. This includes applying AI beyond coding to areas such as customer service, support operations, and risk management. “I think the changes that AI will enable us to do are going to drive — are going to be very significant,” said Lores. “This is why we created a group last week, reporting to me, that is going to be in charge of driving — function by function, process by process — this AI transformation. And this is not about adopting AI as a technology, where we have done many pilots in the company, and we have seen what is possible. It’s really about understanding how can we redesign the key processes … this is what we have seen that really will drive significant savings.”

Announcing an AI-focused push to cut costs while eliminating thousands of jobs highlights a fundamental criticism of the technology — it carries a human toll.

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It’s important to note that PayPal was already in need of restructuring. The company may have exceeded expectations in its first-quarter earnings, reporting revenue of $8.4 billion — up 7% year-over-year — but it issued weak guidance for the second quarter, causing the stock to drop after the earnings release. This follows a prolonged post-pandemic decline that has sent the stock down more than 80% from its 2021 peak and stifled PayPal’s growth. When asked whether separating Venmo into its own division meant the company might be open to selling it, Lores said that, for now, this structure best supports the turnaround plan. Still, he hinted at future possibilities by stating, “my number one priority is to maximize shareholder value,” in response to an analyst’s question about a potential sale.