EBay's Revenue Grows Again -- Update

By Laura Stevens 

EBay Inc. on Wednesday said revenue grew 3.1%, a fourth straight quarter of sales gains as a strong holiday season and a revamp of the company's website appear to be paying off.

The San Jose, Calif.-based online marketplace on Wednesday reported $2.4 billion in revenue, compared with last year's $2.32 billion. Boosted by a big tax benefit, net income was $5.94 billion, or $5.30 a share, compared with $477 million, or 39 cents, a year ago.

On an adjusted basis, eBay reported a per-share profit of 54 cents, in line with expectations of analysts surveyed by Thomson Reuters. Analysts had also expected $2.4 billion in revenue.

EBay's shares rose 7.5% in trading after the market's close, after finishing the day up 0.8%.

EBay was banking in part on its first U.S. and European TV holiday ad campaign since 2014, part of a broader new initiative to help it shed its legacy image as an online garage sale. The marketplace has been trying to attract younger shoppers, highlighting that the majority of the goods on its site are new.

But the holidays have been mixed for many retailers so far. While online spending surged, translating into a generally strong holiday season, traditional retailers including Macy's Inc. and Kohl's Corp. reported disappointing sales. Rival Amazon.com Inc. was a clear winner, commanding an estimated 38% of online sales, according to data from Slice Intelligence, which collects data from email receipts of 4.2 million shoppers. E.commerce also grew at a rate faster than total retail spending -- about 20%.

EBay said late last year it hoped to capitalize on last-minute shoppers in part through highlighting sellers on its site offering expedited shipping. Gross merchandise volume -- or the value of items sold on eBay's marketplace excluding vehicles and real estate -- increased to $21.1 billion, up from $20.68 billion a year ago.

That is also a measure of eBay's new initiative to make its site more easily searchable for shoppers who don't have time to scroll through thousands of search results, especially on their phones. As part of that effort, it is cataloging items on its site, something that should help improve its search results on Alphabet Inc.'s Google. Previously, individual listings changed too frequently to surface high on a search engine, but now items can be grouped and displayed by brands, type and deals.

Ticket seller and marketplace StubHub, a bright spot for the e-commerce company over the last few quarters, reported a 18% increase in revenue to $274 million, outpacing eBay's growth as a whole. The business last year acquired both Spanish rival Ticketbis and software firm Ticket Utils.

EBay said it had 167 million active buyers on the site, up from the third quarter, when it reported it had 165 million.

EBay said it sees full-year adjusted earnings of $1.98 to $2.03 and revenue of $9.3 billion to $9.5 billion, compared with analysts' views of $2.06 a share $9.36 billion.

The company also forecast first-quarter adjusted earnings of 46 cents to 48 cents on revenue of $2.17 billion to $2.21 billion, compared with analysts' expectations of 50 cents and $2.21 billion.

Write to Laura Stevens at [e-mail]

(END) Dow Jones Newswires

January 25, 2017 17:36 ET (22:36 GMT)

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