September 22, 2020

EBay Earnings Rise in First Quarter

EBay reported Wednesday that net income in the first quarter rose 20 percent to $475.9 million, or 36 cents a share, from $398 million, or 30 cents, in the year-ago quarter.

The company said revenue climbed 16 percent to $2.5 billion from $2.2 billion.

The adjusted income of 47 cents a share was slightly above the expectations of Wall Street analysts. They had expected 46 cents a share and revenue of $2.48 billion, according to a survey of analysts by Thomson Reuters.

“In the first quarter, PayPal continued to drive strong growth globally, eBay sharply accelerated growth in the U.S. and we announced several acquisitions that we believe will enhance our leadership and innovation in commerce and payments,” John Donahoe, eBay’s chief executive, said in a news release. “The year is off to a strong start.”

The company, based in San Jose, Calif., said that revenue from its online marketplace during the quarter increased 12 percent to $1.55 billion. EBay is trying — with mixed results — to revamp the service by recasting it as an online outlet mall and upgrading its technology.

Meanwhile, revenue from eBay’s payments unit, of which PayPal is the major contributor, grew 23 percent to $992 million. Within a few years, analysts expect that payments will surpass the marketplace as eBay’s main source of revenue.

EBay passed a milestone in the first quarter as the number of active PayPal accounts surpassed the number of active eBay accounts. There were 97.7 million active PayPal users at the end of the quarter compared with 95.9 million eBay users.

Mr. Donahoe is pushing PayPal as a payments service for all online transactions, not just on eBay. Many major retailers now accept payments through PayPal, and provide a major source of growth. EBay also wants to have PayPal at the center of a mobile payment network for using cellphones and tablets instead of credit cards in transactions.

Meanwhile, Mr. Donahoe is taking eBay is an entirely new direction through its planned $2.4 billion acquisition of GSI Commerce. The deal, announced last month, would put eBay into the business of filling orders and managing stock for large retailers.

The acquisition, which has yet to close, puts eBay on a collision course with Amazon.com, which handles online sales for a number of major retailers.

In after-hours trading, eBay’s shares fell 2.7 percent to $33.10. They had gained 2.9 percent to $34.03 in regular trading before the earnings announcement.

In its forecast, EBay said second-quarter revenue would fall between $2.55 billion and $2.65 billion, with net income of 36 cents or 37 cents a share. Full-year revenue is expected to be $10.6 billion to $10.9 billion, with net income of $1.53 to $1.58 a share.

Article source: http://feeds.nytimes.com/click.phdo?i=0d8509ec3ed4403f47e167f2d54d8f62

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