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eBay’s US sales rise 3.5% in Q3

October 19, 2016 04:49 PM
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The value of goods sold on eBay Inc.’s U.S. marketplace increased to $8.38 billion in the third quarter ended Sept. 30, up 3.5% from $8.10 billion in the same period a year ago, the online marketplace reported Wednesday. For the first nine months of the year, eBay’s sales in the U.S. grew 3.7% to $25.44 billion, up from $24.54 billion in the year-ago period. 

Global sales on eBay’s marketplaces increased to $20.11 billion in the quarter, up 2.6% from $19.601 billion in the same period a year ago. Excluding the impact of foreign exchange rates, global sales rose about 5% in the period, the company says.

Net revenue for eBay’s global marketplaces increased 5.7% in Q3 to $2.22 billion from $2.10 billion a year ago. On a constant-currency basis, revenue jumped 8%.

The number of active buyers, or those who made a purchase in the past 12 months, increased 3.8% to 165 million active buyers from 159 million a year ago.

EBay is making progress on cataloging its products—what it calls its structured data initiative—which requires marketplace sellers to add more details about products they list on eBay.com. This is intended to provide better search results for eBay customers. As of the end of the quarter, 100 million pages are live that conform to structured data rules, compared with 15 million at the end of Q2.  

“We're further enhancing these pages by introducing new features, such as multiple top picks, product comparisons and limited-time deals, and we continue to see significantly higher conversion,” CEO Devin Wenig said on a call discussing the results with investors, according to a transcript from SeekingAlpha. 

For the third quarter ended Sept. 30, eBay also reports:

  • Net income of $509 million, down 3.9%% from $529 million in the same quarter a year earlier.
  • The value of goods sold on eBay’s marketplaces, not including sales on online ticket marketplace StubHub, grew 1.6% to $18.97 billion from $18.67 billion in the same quarter a year ago. Revenue from eBay’s marketplaces, excluding StubHub, was up 1.7% to $1.48 billion from $1.46 billion a year ago. 62% of eBay’s revenue is international.  
  • Sales from fixed-price items on eBay’s marketplaces grew 9% year over year and sales from auction items declined 13% year over year. EBay has moved away from the auction model for which it  was previously well-known. The company doesn’t break down what percentage of its listings are fixed-price versus auction items in its quarterly results, but in its 2015 annual report, eBay said it was an auction site selling vintage items, though 80% of the items sold on eBay are new.  
  • For StubHub, eBay’s concert and sports ticketing marketplace, gross merchandise volume jumped 23.0% year over year to $1.14 billion from $927 million a year ago. Revenue for StubHub was $261 million, up 30.5% from $200 million a year ago. 2% of StubHub's revenue is international. 

For the first nine months of the year, eBay also reports:

  • Net revenue of $6.58 billion, up 4.9% from $6.27 billion a year ago.
  • Net income of $1.33 billion, up 6.4% from $1.25 billion.

During the quarter, eBay sold its stake in MercadoLibre, a leading online marketplace in Latin America. EBay had a nearly 20% stake in the company since 2001.

“We remain committed to our customers in Latin America and have signed a strategic agreement with MercadoLibre that is designed to advance cross-border opportunities for our sellers who are targeting buyers in Latin America,” chief financial officer Scott Schenkel said on the call.

Analysts say this move does not indicate an exit from the Latin America market, but rather follows the pattern of divestments eBay has made recently, such as withdrawing from its business investments like PayPal, Craigslist and eBay Enterprise (Magento). 

“The exit of eBay from MercadoLibre seems more a part of their divesting strategy rather than an exit from the Latin America market, as Latin America seems strong and many others are investing,” says Adrien Nussenbaum, U.S. CEO and co-founder, Mirakl. 

EBay’s exit from MercadoLibre may present an opportunity for other e-commerce global e-commerce giants like China’s Alibaba Group Holding Ltd. to invest in Latin America, Nussenbaum says. “Retail, e-commerce and marketplaces are growing in the region and represent a large opportunity.” 

 

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