Oy Vey eBay
by John Paczkowski
Posted on October 21, 2009 at 1:56 PM PT
Though eBay reported a 29 percent drop in profit for its third quarter Wednesday, the company did deliver revenue that was reasonably higher than Wall Street’s expectations. Not that it mattered much. Investors took eBay out to the woodshed anyway, beating its shares down seven percent in after-hours trading. An unfortunate turn of events considering that eBay’s stock hit a 52-week high earlier in the day.
The online auctioneer reported revenue of $2.23 billion, up six percent from a year ago, while net income fell 29 percent to $350 million or 27 cents per share. Excluding some items, earnings were 38 cents a share. Analysts who follow eBay expected the company to turn in a gain of 37 cents per share on sales of $2.14 billion.
Gross merchandise volume–the value of all goods sold via eBay–rose seven percent from the same period last year. Analysts had believed it would drop between five and 10 percent.
EBay said it sees fourth-quarter earnings of 38 cents to 40 cents a share, on revenue of $2.2 billion to $2.3 billion.
“Our third quarter results were strong, with PayPal gaining momentum and market share worldwide and our core eBay business showing positive trends,” John J. Donahoe, eBay’s chief executive, said in a statement.
NOTES FROM THE EARNINGS CALL
On business overall:
eBay CEO John Donahoe: “These are strong results for a strong company….We’re seeing our turnaround efforts begin to pay off.”
On the economy:
Donahoe: “The economy as we see it is stable, and we’re cautiously optimistic about consumer spending going into the holiday.”
On the Skype lawsuit:
eBay CFO Bob Swan: “We’re highly confident in our position.”
Comments
Forget the BUTS:
Last quarter 2008 – decline
First quarter 2009 – decline
Second quarter 2009 – decline
Third quarter 2009 – decline
Do you see a pattern here? I sure do. Name of the game is revnue and Ebay’s has been declining for over a year now. If Donahoe doesn’t either get out or get over himself and his disruptive innovation he won’t have any company left! The coming holiday season should be the knockout punch. As an 11 year seller on Ebay I have never ever seen such a downturn in traffic and sales and everyone is saying the same thing!
Posted by Patricia none at October 21st, 2009 at 2:08 pmmeg whitman rode ebay to a deadend and then bailed ship before the numbers started looking bad
she made terrible decisions at ebay and it will cost the company its future 100%
in 5 years ebay is dead
Posted by Sam Harrison at October 21st, 2009 at 7:28 pm