UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

SCHEDULE 14A INFORMATION

Proxy Statement Pursuant to Section 14(a) of the Securities

Exchange Act of 1934 (Amendment No.    )

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PayPal Holdings, Inc.

(Name of Registrant as Specified In Its Charter)

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MESSAGE FROM OUR PRESIDENT AND CEO

Dear Stockholders, Customers, Colleagues, and Partners:

This past year was another transformative year for PayPal. Our world is changing rapidly, and the political and economic landscape remains dynamic. The continuing digitization of cash and the global proliferation of mobile technologies are redefining the face of commerce, and creating new opportunities to connect, to share, to shop, and to sell. And yet too many of our global citizens are being left behind. Despite the inherent advantages of the digital economy, it is clear that the benefits of technology are not being equally distributed across society.

While we are making demonstrable progress in many areas, approximately 1.7 billion people are unbanked and even more are underserved by the traditional financial system. Numbers like these make it clear that PayPal’s mission is more relevant than ever. We must innovate and use technology to democratize financial services to help as many people and businesses as possible join and thrive in the digital economy. This is the unifying vision behind everything we do.

Our opportunity to help the underserved, and drive the next era of commerce is immense. Consumers around the world demand and deserve more convenient, accessible, and affordable financial services. Merchants of all shapes, sizes, and industries are looking for ways to get closer to their customers, maximize the opportunities presented by digital commerce, and compete successfully in this new era.

I’m pleased to share with you the progress PayPal has made this year. We continue to transform our business, and I am proud of what we have achieved for our stockholders, our customers, our colleagues, and our partners. We intend to move forward with focus, energy, and purpose to fulfill PayPal’s potential as the world’s leader in digital payments.

Transforming PayPal into an Open Digital Platform

One of our primary goals is to make PayPal the de facto operating system for mobile and digital commerce around the world, serving the entire payments ecosystem, and creating value for all of our customers and partners.

We continue to evolve towards being an open digital payments platform, through a combination of technological innovation, strategic partnerships, and targeted acquisitions. Our differentiated, open platform gives PayPal’s 267 million active account holders the confidence to connect and transact in new and powerful ways, whether online, on a mobile device, in an app, or in a store. For merchants, our full suite of services and products helps to drive incremental sales, and we are a must-have platform for retailers to compete in a mobile commerce environment. As digital payment methods continue to replace cash, we are creating faster and more secure ways to manage and move money, offering greater choice and flexibility when it comes to sending payments between family and friends, paying for goods and services, or getting paid by customers.

We are committed to continued investment in the security of our platform to keep our products and services as safe and secure as possible, which strengthens our ability to navigate an increasingly complex world where cyberattacks are growing more sophisticated and regulatory requirements are continually evolving.

Strong Growth and Engagement to Achieve Record Results

We had a strong year in 2018, driving record-breaking growth across a number of key metrics. We set new benchmarks for revenue, net new active accounts, and engagement across our platform.

A high point in 2018 was our net new active number, which reached a record of 39 million net new active accounts for the year. We exited 2018 with 267 million active accounts on our platform, with approximately 246 million consumers shopping at more than 21 million merchant accounts. We are helping all of our customers join the digital economy, and we are targeting more than 300 million active accounts on our platform by the end of this year.

Importantly, the newest cohorts of users are exhibiting higher levels of engagement, which is an encouraging sign. Overall, we realized nearly 37 payment transactions per active account in 2018. We processed nearly 10 billion transactions in the year, and our overall payment volume grew 26% on a currency-neutral basis to $578 billion.

Revenue for 2018 exceeded $15.4 billion, growing 18% on both a spot basis and FX-neutral basis.¹ In the fourth quarter, we marked the first time in our history that we exceeded $4 billion of revenue in a single quarter. GAAP earnings per share (EPS) in the year grew 16% to $1.71, and non-GAAP EPS grew 28% to $2.42.² We returned more than $3.5 billion to stockholders during the year through stock repurchases.

Innovating and Evolving to Better Serve Our Customers

Throughout 2018, we delivered significant value across our differentiated two-sided platform, introducing new features and services for our consumers and merchants globally. Through a combination of innovation, partnerships, and acquisitions, we greatly strengthened our overall proposition for merchants, while removing friction and providing consumers with increased choice.

We launched industry-defining products that give our consumers more control over their payment experiences, and also help our merchants get closer to their customers in a mobile commerce environment like the ability to pay with rewards points and use PayPal with Google Pay and Samsung Pay. We introduced new products like PayPal Checkout with Smart Payment Buttons, Funds Now, and PayPal for Partners that help merchants maximize their opportunities and get instant access to their funds. One Touch continues to grow, with approximately 124 million consumer accounts opted in, and 11 million merchant accounts now offering the service. These product innovations are all part of PayPal’s expansion into a global platform company, with a clear and inspiring mission, and a commitment to stay true to our values.

Venmo has grown to become an integral part of our portfolio. For merchants, accepting Venmo opens their doors to millions of socially connected and highly-engaged new consumers who already love to pay friends and family with Venmo multiple times every week. For consumers, paying with Venmo is simple and easy, allowing them to split the bill with friends and share their purchases within their social feed.

In 2018, Venmo processed $62 billion in TPV, growing 79% from last year, and showed significant increases in net new actives and monetized volume growth. We couldn’t be more pleased with Venmo’s performance, and we are excited for what the future holds. By leveraging PayPal’s robust global scale and industry-leading technology infrastructure, we are confident that Venmo is uniquely positioned to drive long-term, sustainable revenue and profitable growth for the entire business.

Expanding Our Growing Community of Partners to Open Up the Global Economy

In the past three years, we’ve announced 38 partnership agreements with world-class retailers, financial institutions, traditional credit card networks, and telecom and technology companies. We have secured partnerships with more than 20 top-tier global financial institutions, including 8 of the top 10 banks in the U.S., representing 75% of all U.S. card volume. In the past year, there were nearly 40 bank-led marketing campaigns that encouraged their customers to pay with PayPal. We strongly believe that these partnerships will help seamlessly connect buyers and sellers — ultimately making the digital economy more accessible for consumers and merchants around the world. We made significant strides in 2018 to deepen existing partnerships and develop new relationships with some of the biggest and most influential global brands in technology, retail and finance, including American Express, Walmart, Paymentus, and HSBC.

Our goal is to expand this partner ecosystem so that we can deliver our capabilities to more customers around the world. Internationally, Central and South America, China, India, and Japan are key focus areas. We are investing significant resources into setting up new technologies and developing novel partnerships to help bring a truly global experience to these customers. These partnerships are opening up the digital economy to millions of new consumers and businesses, and we believe they will play an important role in fostering long-term economic health for communities and businesses around the world.

Acting as Responsible Stewards of Our Capital Resources

We desire to create and grow long-term, sustainable value for our stockholders. We have multiple tools to help drive that outcome.

2018 was a major year for acquisitions with our purchases of Hyperwallet, iZettle, Jetlore, and Simility. These outstanding companies each occupy a distinct position in payments or online services, and we’re excited about their respective abilities to expand PayPal’s scope of offerings. We are positioned to be an open, differentiated digital payments platform, and we will continue to be disciplined in our investments. Our acquisition and investment pipeline is healthy, and our balance sheet gives us the flexibility to move quickly and be opportunistic.

We significantly enhanced our strategic flexibility, while maintaining the opportunity to further increase the momentum in our consumer and merchant credit offerings, by selling our U.S. consumer credit portfolio to Synchrony. The transaction was completed in 2018, and we are very pleased with the resulting benefits.

Reaffirming Our Commitment to be a Responsible Global Corporate Citizen

Over the past several years, we’ve embarked on a journey to democratize financial services for individuals and businesses around the world. We recognize that with these efforts, it’s important to regularly take stock of our progress, as well as reflect on how we’re addressing and managing every facet of our business. I’m proud to share that in 2018, we released our inaugural Global Impact Report to share and track our progress on several key priorities: driving social impact through our business, managing our environmental footprint, and living our values. I hope you will take the time to read it, and engage with us on our journey to being a role model global corporate citizen.

We will continue to act on our mission and values, and try to make a difference in the world, day by day and year by year. In early 2019, we further enhanced the diversity of our board of directors, which is now made up of 50% women and underrepresented minority groups. We are working diligently to build an inclusive, collaborative, and sustainable culture.

We are inspired to see our customers drive positive change in our world by using our platform for charitable giving. We shattered our previous Giving Tuesday donation record, with over one million PayPal customers across 180 markets donating nearly $98 million to charitable causes. For the full year, $9.6 billion was donated to nonprofit organizations around the world through the PayPal platform.

Our success is dependent on the support of all of our customers, partners, and stockholders, and the hard work of PayPal employees across the globe. We look forward to making 2019 another productive year for PayPal. Thank you for your support and confidence.

Best regards,

Dan Schulman

President and CEO

PayPal Holdings, Inc.

NOTES:

¹ All growth rates represent year-over-year comparisons, except as otherwise noted. FX-neutral results are calculated by translating the current period’s local currency results with the prior period’s exchange rate. FX-neutral growth rates are calculated by comparing the current period FX-neutral results with the prior period’s results, excluding the impact from hedging activities.

² Non-GAAP earnings per share is a financial measure not calculated in accordance with U.S. generally accepted accounting principles (“GAAP”). For a reconciliation of non-GAAP to GAAP earnings per share, please see the section entitled “Non-GAAP Financial Information” in “Management’s Discussion and Analysis of Financial Conditions and Results of Operations” in our 2018 Annual Report on Form 10-K for the year ended December 31, 2018, as filed with the SEC on February 7, 2019.

MESSAGE FROM OUR INDEPENDENT

CHAIRMAN OF THE BOARD

April 10, 2019

Dear PayPal Stockholder:

On behalf of the Board, thank you for your investment in PayPal. 2018 was a strong year for PayPal and we are excited by the continued execution of our strategic initiatives, which are delivering stockholders long-term, sustainable value.

Engaged and Diverse Board. We have nominated directors who possess a wide variety of relevant skills and backgrounds, bringing the diversity of perspectives necessary to effectively oversee our dynamic business. When evaluating the Board’s composition, we consider the proven capacity of each director to leverage their prior experience to enrich board dialogue. In January, Debbie Messemer joined our Board, bringing a strong global perspective and expertise in finance and accounting, business strategy, and governance that complements the existing directors’ strengths. With Debbie’s appointment, 50% of our directors are women or from underrepresented ethnic groups, a reflection of PayPal’s commitment to inclusion and diversity at all levels of the Company.

Ongoing Stockholder Engagement. Each year, members of senior management reach out to a broad group of stockholders to better understand their perspectives on our strategy, as well as governance, compensation, and sustainability matters. We greatly value the feedback received through these conversations and the insights gained are shared with the Board on an ongoing basis. In 2018, our engagement team reached out to institutional investors holding approximately 60% of our common stock, and spoke with investors representing almost 35% of our common stock. This feedback has informed the Board’s deliberations and actions over the past year, and we look forward to continuing these discussions.

Risk Oversight and Sustainable Business Practices. As a leading technology platform and digital payments company that enables customers to send and receive payments globally, effectively managing risks associated with cybersecurity and privacy is paramount. While our management team is responsible for the day-to-day evaluation of risks, the Board oversees the Company’s overall risk assessment and risk management. Oversight of PayPal’s risk framework and enterprise-wide compliance program is the responsibility of the Audit, Risk and Compliance Committee. Another key area that the Board oversees is PayPal’s environmental and social impact. We believe that effective oversight of these matters is critical to PayPal’s long-term success, and in 2018, we formalized this oversight mechanism through the Corporate Governance and Nominating Committee.

Join Us at Our 2019 Annual Meeting. I look forward to discussing these developments further with you at the 2019 annual meeting, which will again be held via live webcast. We have conducted an exclusively virtual annual meeting each year since becoming a public company in 2015 and have adopted a series of safeguards that we believe provide all stockholders the same rights and opportunities to participate as they would at an in-person meeting. We have found that the live webcast technology enables greater stockholder attendance and participation globally, which allows us to better communicate with our stockholders. Please visit www.virtualshareholdermeeting.com/PYPL19, where you can attend this year’s annual meeting, as well as submit questions before and during the meeting.

Your vote is important. Regardless of whether you plan to participate in the annual meeting, we hope you will vote as soon as possible. You may vote by proxy over the internet, by telephone, or by mail (if you received paper copies of the proxy materials) by following the instructions on the proxy card or voting instruction card. Voting now will ensure your representation at the virtual annual meeting, regardless of whether you attend the meeting online. You may also vote your shares electronically during the virtual meeting.

Sincerely yours,

/s/ John J. Donahoe

John J. Donahoe

Chairman of the Board

Table of Contents

www.paypal.com

Notice of 2019 Annual Meeting of Stockholders

This notice of annual meeting and proxy statement and form of proxy are being distributed and made available on or about April 10, 2019.

Important Notice Regarding the Availability of Proxy Materials for the Annual Meeting of Stockholders to Be Held on May 22, 2019. This proxy statement and PayPal Holdings, Inc.’s 2018 Annual Report are available electronically at https://investor.paypal-corp.com/annuals-proxies.cfm and with your 16-digit control number by visiting www.proxyvote.com.

www.paypal.com

Proxy Statement Summary

This summary highlights certain information contained elsewhere in this proxy statement for the 2019 Annual Meeting of Stockholders (the “Annual Meeting”). This summary does not contain all of the information that you should consider, and you should read the entire proxy statement carefully before voting. References to “PayPal,” the “Company,” “we,” “us,” or “our” refer to PayPal Holdings, Inc.

2019 Annual Meeting Information

Proposals to be Voted on and Board Voting Recommendations

Virtual Annual Meeting

We have held a virtual annual meeting since becoming an independent public company in 2015. We have designed our virtual meeting format to enhance, rather than constrain, stockholder access, participation, and communication. We believe this format facilitates stockholder attendance and participation by enabling all stockholders to participate fully, and equally, using any Internet-connected device from any location around the world at no cost. Our virtual meeting increases our ability to engage with all stockholders, regardless of size, resources, or physical location, while saving the Company’s and investors’ time and money and reducing our environmental impact.

During the live Q&A session of the meeting, members of our executive management and our Chairman of the Board will answer questions as they come in and address those asked in advance, as time permits. Our rules of conduct and procedure governing our virtual annual meeting generally provide that:

Our virtual meeting website will contain instructions for accessing technical support to assist in the event a stockholder encounters any difficulties accessing the virtual meeting.

We have committed to posting our Q&A on our Investor Relations website as soon as practicable following the conclusion of the annual meeting. In addition, although the webcast is available only to stockholders at the time of the meeting, a replay of the meeting is made publicly available on our Investor Relations site after the meeting concludes.

		2019 Proxy Statement

Who We Are and What We Do

PayPal Holdings, Inc. is a leading technology platform and digital payments company that enables digital and mobile payments on behalf of consumers and merchants worldwide. We provide safer and simpler ways for businesses of all sizes to accept payments from merchant websites, mobile devices, and applications, and at offline retail locations, through a wide range of payment solutions.

We are committed to democratizing financial services and empowering people and businesses to join and thrive in the global economy. Our goal is to enable our consumers and merchants to manage and move their money anywhere in the world, anytime, on any platform and using any device. Our combined payment solutions, including our PayPal, PayPal Credit, Braintree, Venmo, Xoom, and iZettle products, compose our proprietary Payments Platform.

2018 Performance Highlights

In 2018, we completed our third full year as an independent public company after our separation from eBay in 2015. Our business delivered strong revenue and non-GAAP operating margin performance. We set new benchmarks for revenue, net new active accounts, transactions, and engagement, strengthened our strategic positioning through a combination of innovation, partnerships, and acquisitions, and greatly bolstered our platform capabilities. We continued to focus on the long-term growth of our business by executing on a broad transformation of our culture and business model to strengthen and expand our customer choice initiatives and partnerships across the ecosystem.

The following summarizes our key financial and operational performance results for 2018. We use certain of these key metrics as the performance measures in our incentive compensation program and believe these measures help to align the interests of our executives with those of our stockholders.

Performance Highlights Revenue Non-GAAP Operating Margin1 Free Cash Flow1 Expanding Our Base: Active Accounts of 267 Million Up 17% from 2017 Driving Customer Engagement: 9.9 Billion Payment Transactions Up 27% from 2017 Gaining Share: Total Payment Volume of $578 Billion Up 27% from 2017

www.paypal.com

¹ Non-GAAP operating margin and free cash flow are two of the performance metrics used in our incentive compensation program. Non-GAAP operating margin and free cash flow are not financial measures prepared in accordance with generally accepted accounting principles (“GAAP”). For information on how we compute these non-GAAP financial measures and a reconciliation to the most directly comparable financial measures prepared in accordance with GAAP, please refer to the section entitled “Non-GAAP Financial Information” in “Management’s Discussion and Analysis of Financial Condition and Results of Operations” in our 2018 Annual Report on Form 10-K filed with the SEC on February 7, 2019, which section is incorporated herein by reference.

² Free Cash Flow for 2017 and 2018 reflect the impact of held for sale accounting treatment in connection with the sale of the Company’s U.S. consumer credit receivables portfolio, which reduced free cash flow for 2017 by approximately $1.3 billion and increased free cash flow for 2018 by approximately $1.4 billion. Normalizing for this impact, free cash flow for 2017 and 2018 would have been approximately $3.2 billion and $3.3 billion, respectively.

In addition to our strong financial and operational results, we achieved the following in 2018:

To learn more about our 2018 performance and how it relates to our executive compensation program, see the Compensation Discussion and Analysis beginning on page 38.

2019 Director Nominees

Name and Primary Occupation		Independent				Age		Director since				Committee Memberships*				Other Public Company Boards
Rodney C. Adkins						60			2017				ARC;				4	**
President, 3RAM Group LLC													Governance
Wences Casares						45			2016				Compensation				—
CEO and Founder, Xapo Inc.
Jonathan Christodoro						42			2015				Compensation				4
Partner, Patriot Global Management, L.P.
John J. Donahoe						58			2015				—				2
President and CEO, ServiceNow, Inc.
David W. Dorman						65			2015				Compensation (Chair);				1
Former Chairman and CEO, AT&T Corporation (retired)													Governance
Belinda J. Johnson						52			2017				ARC				—
Chief Operating Officer, Airbnb, Inc.
Gail J. McGovern						67			2015				Compensation;				1
President and CEO, American Red Cross													Governance (Chair)
Deborah M. Messemer						61			2019				ARC				1
Former Managing Partner, KPMG (retired)
David M. Moffett						67			2015				ARC (Chair)				2
Former CEO, Federal Home Loan Mortgage Corp. (retired)
Ann M. Sarnoff						57			2017				ARC				—
President, BBC Studios Americas
Daniel H. Schulman			—			61			2015				—				2
President and CEO, PayPal Holdings, Inc.
Frank D. Yeary						55			2015				ARC				1
Manager, Darwin Capital Advisors, LLC

* ARC = Audit, Risk and Compliance Committee; Compensation = Compensation Committee; Governance = Corporate Governance and Nominating Committee

^** Mr. Adkins has notified us that he will be stepping down from the PPL Corporation board in May 2019, which will reduce the number of other public company boards on which he serves to three.

		2019 Proxy Statement

Ensuring that the Board of Directors of PayPal (the “Board” or the “PayPal Board”) is composed of directors who possess highly relevant skills, professional experience and backgrounds, bring diverse viewpoints and perspectives, and effectively represent the long-term interests of stockholders, is a top priority of the Board and the Corporate Governance and Nominating Committee. The following provides a snapshot of the diversity, skills, and experience of our director nominees.

		Skills and Experience Diversity 50% of the Board are women 66 or from under Represented ethnic groups Diversity Other Payments, Financial Services and Fin Tech Technology and Innovation Business Development and Strategy Senior Leadership Legal Regulatory Governmental Global Business Other Public Company Board Service Finance Accounting Consumer Marketing Brand Management Cybersecurity/Information Security Human Capital Management Independence Diversity Nominees

www.paypal.com

Corporate Governance

Corporate governance at PayPal is designed to promote the long-term interests of our stockholders, strengthen Board and management accountability, foster responsible decision-making, and engender public trust. We believe strong corporate governance practices that provide meaningful rights to our stockholders and ensure Board and management accountability are essential to our long-term success.

The following are the key governance provisions that demonstrate PayPal’s commitment to transparency, accountability, independence, and diversity

To learn more about our corporate governance programs, see page 24.

Executive Compensation

OUR COMPENSATION PROGRAM

We completed another strong year, during which we set new benchmarks and expanded our value proposition for our customers. For 2018, the Compensation Committee of the Board approved an executive compensation program based on our “pay for performance” philosophy that is designed to align our executive officers’ compensation with the key drivers of profitable short-term and long-term growth with the goals of properly incentivizing and rewarding our executives for performance that exceeds expectations, providing transparency for both our executives and our stockholders, and positioning us competitively to enable us to attract and retain our executives.

		2019 Proxy Statement

OUR 2018 NEO PAY

We believe that our executive compensation program was effective at incentivizing results in 2018 by appropriately aligning pay and performance. The following charts show the 2018 Target Total Direct Compensation mix for our Chief Executive Officer, Mr. Schulman (our “CEO”), and the average 2018 Target Total Direct Compensation mix for our other named executive officers (consisting of our principal financial officer and the three most highly compensated executive officers other than our CEO and CFO) (“NEOs”). Target Total Direct Compensation is the sum of (i) 2018 base salary, (ii) target 2018 annual incentive award (based on the grant date fair value for the portion of the award delivered as performance-based restricted stock units), and (iii) target annual long-term incentive award (based on the grant date fair value). For our CEO, Total Target Direct Compensation also included a CEO performance share unit award (as seen in the chart below) granted in 2018 to further incentivize significant stockholder value creation over a five-year period. To learn more about our executive compensation program, see the Compensation Discussion and Analysis beginning on page 38.

OUR PAY PRACTICES

We are committed to maintaining strong governance standards with respect to our executive compensation program, policies, and practices. Consistent with this focus, we maintain the following policies and practices that we believe demonstrate our commitment to executive compensation best practices.

www.paypal.com

SUPPORTING OUR EXECUTIVE COMPENSATION PROGRAM

The Compensation Committee believes that the goals of our executive compensation program are appropriate and that our executive compensation program supports PayPal’s growth strategy and is well-aligned with creating long-term stockholder value.

To learn more about our executive compensation program, see the Compensation Discussion and Analysis beginning on page 38.

		2019 Proxy Statement

Environmental and Social Sustainability Oversight

PayPal recognizes its responsibility as a global citizen to operate in a responsible and sustainable manner aligned with our mission, vision, and values to build a more financially inclusive and interconnected world. The management of key non-financial risks and opportunities, such as workforce inclusion and development, social impact, and environmental sustainability, are critical components in the Company’s long-term performance and strategy.

Over the past year, we formalized the Board’s oversight, executive leadership and operationalization of our Environmental, Social and Governance (ESG) efforts:

In 2018, we published our first annual ESG report, the 2017 Global Impact Report, which highlights four key priority areas of our ESG program:

To access the full 2017 Global Impact Report, visit: www.paypal.com/us/webapps/mpp/about/responsible-practices.

The Company is committed to regular communication of environmental and social sustainability topics. As our ESG efforts continue to evolve, we are committed to sharing progress through subsequent reports and updates.

www.paypal.com

Proposal 1 — Election of Directors

The 12 directors listed below have been nominated by our Board for election at the Annual Meeting, to serve until our 2020 Annual Meeting of Stockholders and until their successors are elected and qualified. All of the nominees are currently members of the Board. All of the director nominees are independent under the listing standards of The Nasdaq Stock Market (“Nasdaq”), except for Mr. Schulman.

Except for Ms. Messemer, each of our current directors has been previously elected by our stockholders. Based upon the recommendations of our Corporate Governance and Nominating Committee (the “Governance Committee”), the Board appointed Ms. Messemer as a director in January 2019. Ms. Messemer was initially identified as a potential candidate by an executive officer.

We expect that each director nominee will be able to serve if elected. If any director nominee is not able to serve, proxies may be voted for substitute nominees, unless the Board chooses to reduce the number of directors serving on the Board.

MAJORITY VOTE STANDARD

Under our Amended and Restated Bylaws (“Bylaws”), directors must be elected by a majority of the votes cast in uncontested elections, such as the election of directors at the Annual Meeting. This means that the number of votes cast “FOR” a director nominee must exceed the number of votes cast “AGAINST” that nominee. Abstentions and broker non-votes are not counted as votes “FOR” or “AGAINST” a director nominee. As a result, abstentions and broker non-votes will have no effect on the vote for this proposal. If a director nominee who currently serves as a director is not re-elected, Delaware law provides that the director would continue to serve on the Board as a “holdover director.” Under our Bylaws and the Governance Guidelines of the Board (the “Corporate Governance Guidelines”), each director submits an advance, contingent, irrevocable resignation that the Board may accept if stockholders do not re-elect that director. Within 90 days of the certification of the stockholder vote (subject to an additional 90-day period in certain circumstances), the Governance Committee, or a committee composed solely of independent directors that does not include such incumbent director, would determine whether to accept the director’s resignation in accordance with our Bylaws, and the Company would publicly disclose such decision and the rationale behind it.

In a contested election, the required vote would be a plurality of votes cast.

DIRECTOR NOMINEES

The Governance Committee and the Board have evaluated each of the director nominees against the factors and principles used to select director nominees. Based on this evaluation, the Governance Committee and the Board have concluded that it is in the best interests of the Company and its stockholders for each of the proposed director nominees on pages 13-20 below to continue to serve as a director of the Company. The Board believes that each of the director nominees has a strong track record of being a responsible steward of stockholders’ interests and brings extraordinarily valuable insight, perspective, and expertise to the Board.

The Governance Committee and the Board evaluate director nominees based several key qualifications and attributes. The following provides a snapshot of the diversity, skills, and experiences of our director nominees:

		Highly relevant professional experience in payments, financial services, FinTech, technology, innovation, business development, strategy, legal, regulatory, government, global business, finance, accounting, consumer, marketing, brand management, cybersecurity, information security, and human capital management;
		Relevant senior leadership/CEO experience;
		High-level managerial experience in complex organizations;
		Experience and expertise that complement the skill sets of the other director nominees;
		High degree of character and integrity and ability to contribute to strong Board dynamics;
		Highly engaged and able to commit the time and resources needed to provide active oversight of PayPal and its management, including attending at least 75% of the total number of meetings of the Board and committees of the Board on which he or she served during 2018;
		Sound business judgment; and
		Commitment to enhancing stockholder value.

Eleven of our 12 nominees for election are independent and, as part of PayPal’s commitment to diversity and inclusion, 50% of the Board members are women or from underrepresented ethnic groups.

		2019 Proxy Statement

Core Director Skills, Expertise, and Attributes

Listed below are the core skills, expertise and attributes that we consider important to have represented on our Board of Directors in light of our current business strategy and structure. We do not believe that each director needs to have all of these skills. Each director’s biography notes his or her relevant skills — see pages 13-20 for more detail.

PAYMENTS, FINANCIAL SERVICES AND FINTECH (8/12 DIRECTORS)

Experience in the payments, financial services, and financial technology (“FinTech”) industries, which is critical to the oversight of PayPal’s business and strategy.

TECHNOLOGY AND INNOVATION (9/12 DIRECTORS)

Experience and knowledge in developing technology businesses, anticipating technological trends, and driving innovation and product development, which are relevant to PayPal as a technology platform and digital payments company.

BUSINESS DEVELOPMENT AND STRATEGY (12/12 DIRECTORS)

Experience in strategy, business development, and acquisitions and other business combinations, which is relevant in helping PayPal grow our business and assessing the fit of potential targets with our strategy and culture.

SENIOR LEADERSHIP (12/12 DIRECTORS)

Senior leadership and/or CEO experience, with a practical understanding of organizations, processes, strategic planning and risk management to assess, develop, and implement our business strategy and operating plan.

LEGAL / REGULATORY / GOVERNMENTAL (10/12 DIRECTORS)

Knowledge or experience with legal issues, regulatory issues, and compliance obligations (including deep engagement with regulators as part of a business), and governmental policy within a company or regulatory body, which is relevant to PayPal as we operate globally in a rapidly evolving legal and regulatory environment where government regulation impacts key aspects of our business.

GLOBAL BUSINESS (12/12 DIRECTORS)

Experience in international markets, with an understanding of diverse business environments, economic conditions, cultures, and regulatory frameworks, which is relevant to PayPal as a global business operating in over 200 markets around the world.

OTHER PUBLIC COMPANY BOARD EXPERIENCE (10/12 DIRECTORS)

Experience as a director of a public company, which provides diversity of perspectives and valuable and relevant experience, including the oversight responsibilities of the Board and Board committees.

FINANCE / ACCOUNTING (11/12 DIRECTORS)

Experience with financial reporting, capital allocation, and accounting, which is relevant to the oversight of PayPal’s capital structure, financing, and investing activities, as well as our financial reporting and internal controls.

CONSUMER, MARKETING AND BRAND MANAGEMENT (8/12 DIRECTORS)

Experience in sales, marketing, and brand management, which is relevant to the growth of PayPal’s business and brand awareness.

CYBERSECURITY / INFORMATION SECURITY (5/12 DIRECTORS)

Expertise in managing cybersecurity and information security risks, which is vital to protecting PayPal’s technology infrastructure and payments platform and maintaining the trust of our customers.

HUMAN CAPITAL MANAGEMENT (12/12 DIRECTORS)

Experience in attracting, motivating, developing, and retaining qualified personnel and succession planning, which is relevant for PayPal’s growth and particularly important within the context of our highly competitive market for employee talent in which we operate.

www.paypal.com

The directors’ biographies and the skills matrix set forth below note each director’s relevant experience, qualifications, and skills relative to the list above.

Experience, Expertise or Attribute

Payments, Financial Services and FinTech

Technology and Innovation

Business Development and Strategy

Senior Leadership

Legal / Regulatory / Governmental

Global Business

Other Public Company Board Service

Finance / Accounting

Consumer / Marketing / Brand Management

Cybersecurity / Information Security

Human Capital Management

Independence

Diversity (Gender, Underrepresented Ethnic Groups)

		2019 Proxy Statement

Included in each director nominee’s biography below is a description of select key experience and qualifications of the nominee. The Board and the Governance Committee believe that the combination of the various qualifications, skills, and experience of the director nominees would contribute to an effective and well-functioning Board and that, individually and collectively, the director nominees possess the necessary qualifications to provide effective oversight of the business and quality advice and counsel to the Company’s management.

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				John J. Donahoe Age: 58   Director since: July 2015   Board Committees: None   Other Current Public Company Boards: Nike, Inc. ServiceNow, Inc.   Key Qualifications and Experience: •  Payments and FinTech •  Technology •  Business Development and Strategy •  CEO Experience •  Global Business •  Other Public Company Board Service •  Finance •  Consumer and Marketing •  Cybersecurity/Information Security •  Human Capital Management
		Biography: •  President and Chief Executive Officer of ServiceNow, Inc., an enterprise cloud company, since April 2017 •  Former President and Chief Executive Officer of eBay from March 2008 to July 2015, and was a director of eBay from January 2008 to July 2015 •  Former President, eBay Marketplaces from March 2005 to January 2008 •  Former Worldwide Managing Director of Bain & Company from January 2000 to February 2005 •  M.B.A. from the Stanford Graduate School of Business; B.A. in Economics from Dartmouth College

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				Belinda J. Johnson Age: 52   Director since: January 2017   Board Committees: Audit, Risk and Compliance   Other Current Public Company Boards: None   Key Qualifications and Experience: •  Payments •  Technology •  Business Development and Strategy •  Senior Leadership •  Legal and Regulatory •  Global Business •  Finance •  Consumer, Marketing, and Brand Management •  Human Capital Management
		Biography: •  Chief Operating Officer of Airbnb, Inc., a global community marketplace which provides access to unique accommodations and experiences, since February 2018 •  Former Chief Business Affairs and Legal Officer of Airbnb, Inc., starting in July 2015, having joined as General Counsel in December 2011 •  Former Senior Vice President and Deputy General Counsel of Yahoo! Inc., a digital information platform, until August 2011; Ms. Johnson also served in other positions at Yahoo! Inc. from August 1999 •  Former General Counsel of Broadcast.com, Inc., an internet broadcasting company from November 1996 to August 1999 •  B.A. from The University of Texas at Austin; J.D. from The University of Texas Law School

				Gail J. McGovern Age: 67   Director since: June 2015   Board Committees: Compensation Governance (Chair)   Other Current Public Company Boards: DTE Energy Company   Key Qualifications and Experience: •  Technology •  Business Development and Strategy •  CEO Experience •  Regulatory and Compliance •  Global Business •  Other Public Company Board Service •  Finance •  Consumer, Marketing, and Brand Management •  Human Capital Management
		Biography: •  Former board member of eBay from March 2015 to July 2015 •  President and Chief Executive Officer of the American Red Cross, a humanitarian organization, since June 2008 •  Serves as a trustee of John Hopkins Medicine •  B.A. in quantitative sciences from Johns Hopkins University; M.B.A. from Columbia University

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				Ann M. Sarnoff Age: 57   Director since: June 2017   Board Committees: Audit, Risk and Compliance   Other Current Public Company Boards: None   Key Qualifications and Experience: •  Technology •  Business Development and Strategy •  Senior Leadership •  Regulatory •  Global Business •  Other Public Company Board Service •  Finance •  Consumer and Marketing •  Human Capital Management
		Biography: •  President of BBC Worldwide Americas, recently renamed BBC Studios Americas, a media company that delivers high- quality, innovative and intelligent programming, since August 2015 •  Served as Chief Operating Officer of BBC Worldwide North America from 2010 through July 2015 •  Chair of the board of BritBox, a joint venture subscription streaming service launched in partnership with ITV in March of 2017 •  Sits on the board, operating committee, and editorial committee of BBC America, a joint venture with AMC Networks •  Former President of Dow Jones Ventures and Senior Vice President of Strategy for Dow Jones & Company, Inc. from June 2006 until joining BBC Worldwide in 2010 •  Member of the board of directors of Georgetown University, the vice chair of the McDonough School of Business at Georgetown, and is on the board of the Harvard Business School Women’s Association of New York •  Previously served on the Board of HSN, Inc., an interactive multichannel retailer, from December 2012 to December 2017 •  B.S. from Georgetown University’s McDonough School of Business; MBA from Harvard Business School

				Daniel H. Schulman Age: 61   Director since: July 2015   Board Committees: None   Other Current Public Company Boards: Symantec Corporation Verizon   Key Qualifications and Experience: •  Payments, Financial Services and FinTech •  Technology •  Business Development and Strategy •  CEO Experience •  Legal, Regulatory and Governmental •  Global Business •  Other Public Company Board Service •  Finance and Accounting •  Consumer, Marketing and Brand Management •  Cybersecurity/Information Security •  Human Capital Management
		Biography: •  President and Chief Executive Officer of PayPal since July 2015; served as the President and CEO-Designee of PayPal from September 2014 until July 2015 •  Former Group President, Enterprise Group of American Express Company, a financial services company, from August 2010 to August 2014 •  Former President, Prepaid Group of Sprint Nextel Corporation, a cellular phone service provider, from November 2009 until August 2010, when Sprint Nextel acquired Virgin Mobile, USA, a cellular phone service provider •  B.A. from Middlebury College; M.B.A. from New York University’s Leonard N. Stern School of Business

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				Frank D. Yeary Age: 55   Director since: July 2015   Board Committees: Audit, Risk and Compliance   Other Current Public Company Boards: Intel Corporation   Key Qualifications and Experience: •  Financial Services •  Business Development and Strategy •  Senior Leadership •  Governmental, Regulatory and Compliance •  Global Business •  Other Public Company Board Service •  Finance and Accounting •  Human Capital Management
		Biography: •  Former board member of eBay from January 2015 to July 2015 •  Manager at Darwin Capital Advisors, LLC, a private investment firm •  Former Executive Chairman of CamberView Partners, LLC, a corporate advisory firm, until 2018 •  Former Vice Chancellor of the University of California, Berkeley, a public university, from 2008 to 2012, where he led and implemented changes to the university’s financial and operating strategy •  Prior to 2008, Mr. Yeary spent 25 years in the finance industry, most recently including as Managing Director, Global Head of Mergers and Acquisitions and as a member of the Management Committee at Citigroup Investment Banking, a financial services company •  B.A. in History and Economics from the University of California, Berkeley

CONSIDERATION OF DIRECTOR NOMINEES

Stockholder Recommendations and Nominations

The Governance Committee is responsible for recommending to the Board a slate of nominees for election at each annual meeting of stockholders. Nominees may be suggested by directors, members of management, stockholders, or by a third-party firm. In evaluating potential director nominees, the Governance Committee considers a wide range of factors, including the criteria described below under “Director Selection Process and Qualifications.”

Stockholders who would like the Governance Committee to consider their recommendations for director nominees should submit their recommendations in writing by mail to the Governance Committee in care of our Corporate Secretary at PayPal Holdings, Inc., 2211 North First Street, San Jose, California 95131, stating the candidate’s name and qualifications for Board membership. Recommendations by stockholders that are made in accordance with these procedures will receive the same consideration by the Governance Committee as other suggested nominees.

In addition, our Restated Certificate of Incorporation (“Certificate of Incorporation”) and Amended and Restated Bylaws (“Bylaws”) provide proxy access rights that permit eligible stockholders to nominate candidates for election to the Board in the Company’s proxy statement. These proxy access rights permit a stockholder, or group of up to 20 stockholders, owning 3% or more of the Company’s outstanding common stock continuously for at least three years to nominate and include in the Company’s proxy materials director nominees constituting up to 20% of the Board, provided that the stockholder(s) and nominee(s) satisfy the requirements and procedures described in our Certificate of Incorporation and Bylaws.

Director Selection Process and Qualifications

The Governance Committee is responsible for recommending to the Board the qualifications for Board membership and for identifying, assessing and recommending qualified director candidates for the Board’s consideration. The Board’s membership qualifications and nomination procedures are set forth in the Corporate Governance Guidelines.

		2019 Proxy Statement

The Board and Governance Committee consider the following factors and principles in evaluating and selecting director nominees:

In particular, the Governance Committee values diversity as a factor in selecting nominees. When searching for new directors, the Governance Committee actively seeks out qualified women and individuals from underrepresented ethnic groups to include in the pool from which Board nominees are chosen. In keeping with this commitment to inclusion and diversity, 50% of our current Board is comprised of women or underrepresented ethnic groups.

From time to time, the Governance Committee may retain an executive search firm to assist in identifying, screening, and evaluating potential candidates.

Director Compensation

The Compensation Committee is responsible for reviewing and making recommendations to the Board regarding compensation paid to non-employee directors for their Board and committee services. On an annual basis, the Compensation Committee reviews the non-employee director compensation program, receiving input from the Compensation Committee’s independent compensation consultant regarding market practices and the competitiveness of the non-employee director compensation program in relation to the general market and the Company’s peer group.

2018 DIRECTOR COMPENSATION

For 2018, each non-employee director of the Company received the following annual retainers on the first trading day after January 1, 2018:

A non-employee director who serves as the Board Chair and/or as the chair of a committee was entitled to receive the Board Chair annual retainer and/or committee chair annual retainer in addition to the non-employee director annual retainer, but was not entitled to the committee member annual retainer for serving as a member of that specific committee.

A non-employee director could elect to receive 100% of his/her annual retainer(s) in fully vested stock awards of PayPal common stock having a value equal to the annual retainer(s), in lieu of cash.

If a non-employee director was appointed or elected to serve as a member of the Board (or appointed to serve as a member of a committee or as a chair of a committee in which he/she was not a member or chair prior to such appointment) following the annual retainer payment date (i.e., the first trading day of the year), the non-employee director received a prorated annual retainer, based on the number of days from the appointment or election date to December 31 of the year.

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2018 Equity Awards:

In addition to the annual retainers, all non-employee directors of PayPal received the following fully vested stock awards of PayPal common stock following PayPal’s 2018 annual meeting of stockholders:

¹ The Board Chair received $100,000 in PayPal common stock in addition to the $275,000 in PayPal common stock that he received for services as a non-employee director.

The number of shares of PayPal common stock subject to the stock award is determined by dividing the amount of the annual equity award by the per share fair market value (i.e., the closing price of our common stock) on the date of the annual stockholders meeting, rounded up to the nearest whole share.

For 2018, if a non-employee director was appointed or elected at any time other than at an annual stockholders meeting, such director was eligible to receive a prorated annual equity award, as of the date of his or her appointment or election, for the period prior to the first annual stockholders meeting following his or her appointment or election, determined by (i) multiplying the amount of the annual equity award (i.e., $275,000 and, with respect to the additional equity award to the Board Chair, $100,000) by a fraction, the numerator of which was the number of days from the date of appointment or election to the first anniversary of the most recent annual stockholders meeting, and the denominator of which was 365, and (ii) dividing such amount by the per share fair market value on the date of appointment or election, rounded up to the nearest whole share.

2019 DIRECTOR COMPENSATION

In late 2018, the Compensation Committee recommended certain adjustments to the annual retainers for the 2019 director compensation program based on market practices. Effective January 1, 2019, each non-employee director of the Company will receive the following annual retainers on the first trading day of the year in which the director serves as a non-employee director of the Company. The Non-Executive Board Chair’s retainer was reduced from $100,000/year to $50,000/year to bring the fees more in line with the Company’s peer group.

2019 Equity Awards:

In late 2018, the Compensation Committee also recommended certain adjustments to the annual equity awards under the 2019 director compensation program based on market practices. In addition to the annual retainers as set forth above, all non-employee directors of the Company will receive the following fully vested stock awards of PayPal common stock following PayPal’s 2019 annual meeting of stockholders. The Non-Executive Board Chair’s annual stock award was reduced from $100,000/year in value to $50,000/year in value to bring the award more in line with the Company’s peer group.

¹ The Board Chair receives $50,000 in PayPal common stock in addition to the $275,000 in PayPal common stock that he receives for services as a non-employee director.

Deferred Compensation

Beginning in 2019, our non-employee directors are eligible to defer compensation earned in 2019 pursuant to the PayPal Holdings, Inc. Deferred Compensation Plan (“DCP”), our non-qualified deferred compensation plan. The DCP allows participants to set aside tax-deferred amounts. The investment return on the deferred cash amounts is linked to the performance of a range of market-based investment choices made available pursuant to the DCP.

		2019 Proxy Statement

2018 DIRECTOR COMPENSATION TABLE

The following table summarizes the total compensation paid by the Company to non-employee directors for the fiscal year ended December 31, 2018. Ms. Messemer joined the Board in January 2019 and did not receive any compensation in fiscal year 2018.

¹ The amounts reported in the Fees Earned or Paid in Cash column reflect the cash fees earned by each non-employee director in 2018, which includes fees with respect to which the following directors elected to receive fully vested shares of PayPal common stock in lieu of cash: