On Wednesday, eBay released its earnings for the second quarter of 2018. The company continues to be stagnant on earnings and shares were down slightly in after hours trading.
Wall Street seems to be a bit concerned about the company having plateaued again as financial guidance on Q3 was slightly below expectations.
The following is the press release from eBay and we will follow up with highlights from their earnings call in a separate post.
Q2 Revenue of $2.6 billion; GMV of $23.6 billion.
- Revenue of $2.6 billion
- GAAP and Non-GAAP EPS per diluted share of $0.64 and $0.53, respectively, on a continuing operations basis
- Repurchased approximately $1.0 billion of common stock
eBay Inc., a global commerce leader, delivered revenue for the quarter ended June 30, 2018 of $2.6 billion, increasing 9% on an as-reported basis and 6% on a foreign exchange (FX) neutral basis, primarily driven by gross merchandise volume (GMV) of $23.6 billion, up 10% on an as-reported basis and 7% on an FX-Neutral basis.
During the quarter, eBay delivered GAAP net income from continuing operations of $638 million, or $0.64 per diluted share and Non-GAAP net income from continuing operations of $533 million, or $0.53 per diluted share.
The company generated $372 million of operating cash flow and $188 million of free cash flow from continuing operations while also repurchasing approximately $1.0 billion of its common stock in the quarter.
“In Q2 we continued to execute our strategy, making improvements to the core eBay experience. At the same time, we pursued significant opportunities in advertising and payments. As we look ahead to the second half of 2018, we expect acceleration in our core business and continued strong growth in earnings.”
Devin Wenig, President and CEO of eBay Inc.
In the second quarter, eBay grew active buyers by 4% across its platforms, for a total of 175 million global active buyers.
Underlying total eBay Inc. performance, the Marketplace platforms delivered $2.1 billion of revenue and $22.6 billion of GMV.
Marketplace revenue growth was 9% on an as-reported basis and 6% on an FX-Neutral basis, and GMV was up 11% on an as-reported basis and 7% on an FX-Neutral basis.
StubHub drove revenue of $246 million, up 4% on an as-reported basis and 3% on an FX-Neutral basis, and GMV of $1.1 billion, up 5% on both an as-reported and FX-Neutral basis.
Classifieds platforms delivered revenue of $259 million, up 18% on an as-reported basis and 10% on an FX-Neutral basis.
Continuing to Improve the Platform
eBay continues to make it easier to buy and sell on its platform. During the quarter, the company launched Interests, a new feature that tailors consumers’ shopping experience based on their passions, hobbies and style.
Shoppers select what they’re interested in, and the new feature transforms their homepage with themes and items chosen just for them.
To ensure that customers have access to the best deals, eBay introduced Best Price Guarantee, offering US shoppers 110% of the price difference if they find an item for less on a competitor’s website.
The company rolled out a number of competitive initiatives in Australia, including eBay Plus, eBay’s membership shopping program that gives members in Australia free delivery and returns on 15 million products, and Guaranteed Delivery, which provides the ability to search and filter items by delivery speed.
For sellers, eBay released an update to simplified selling on its Android and iOS native apps, which allows items to be listed on eBay within seconds and makes selling even easier.
The company also announced its intent to sell its holdings in Flipkart, which will represent gross proceeds of approximately $1.1 billion.
Following the close of the transaction, eBay will end its current strategic relationship with Flipkart. The company plans to relaunch eBay India with a differentiated offer to focus initially on the cross-border trade opportunity.
In Q2, eBay also completed its acquisition of Giosis’ Japan business, including the Qoo10.jp platform, which expands its footprint in Japan.
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