“We anticipate this reduction in our cost structure will result in at least $1.3 billion of cost savings in 2023, which will result in operating margin expansion next year.”

In context

“discussed during our last call, we have been working to drive productivity improvements across all functions. Our strategy shift to focus on customer engagement from our unparalleled network of consumer and merchant accounts led to significant opportunity for greater efficiency and, importantly, deeper investments in our world-class portfolio of assets. We have narrowed our focus, driven greater productivity and increased our market share gains with profitable growth. We are leveraging our enhanced scale coming out of the pandemic to drive meaningful reductions in unit costs across our supplier base. As a result, we will realize our target of approximately $900 million of savings in 2022 across our OpEx and transaction expenses, which was contemplated in our reset guidance last quarter. We anticipate this reduction in our cost structure will result in at least $1.3 billion of cost savings in 2023, which will result in operating margin expansion next year. These cost savings are not onetime in nature and will continue to benefit the company on a run rate basis. We are also still sharpening our pencils to identify additional areas of productivity improvements across our servicing, marketing and engineering functions as well as opportunities to rationalize our real estate footprint and shift our hiring to lower-cost geographies. These efficiency gains will allow us to increase our investments in our highest conviction growth opportunities, which, as I mentioned, include Checkout, Braintree and our digital wallets. Importantly, as a result of this exercise and disciplined leadership from our team, we are targeting nontransaction-related operating expenses to be roughly flat as we exit 2022. Consequently, we expect operating margin expansion”