Analysts value Skype at roughly $2 billion. But John Donahoe, CEO of parent company eBay, values it at more than that. Asked to put a price on the Internet telephony business, Donahoe declined, but he said $2 billion is “low.”
EBay reported Q1 sales and earnings this afternoon that fell from the same quarter last year, but beat analysts’ estimates just the same. The company’s revenue totaled $2.02 billion, down 7.8 percent from $2.19 billion in 2008. Earnings were 39 cents per share. Analysts had been expecting worse, with estimates of 1.94 billion in revenue and earnings of 34 cents per share.
Describing its long-term financial outlook to analysts last week, eBay said it expects Skype to more than double its revenue to over $1 billion by 2011. Quite a claim to make about an Internet telephony business for which the company has taken some pretty nasty write-downs, a business that back in January eBay seemed to be looking to divest. But apparently, eBay sees quite a bit of promise in Skype’s new voice-over-IP service for businesses.
Apparently, fear of a deepening recession alone isn’t enough to maintain tech worker loyalty these days–mounting job losses be damned. This week, Google repriced millions of employee stock options that had gone underwater as the company’s share price declined. Now eBay hopes to do the same. The reason: employee retention.
Amazon’s much needed good news in a week full of bad news is proving a boon to investors. The nice gain the online retailer posted in its fourth quarter appears to be reviving traders beaten into submission by the worst economic malaise since the Depression. Amazon’s shares are trading up more than 17 percent as I write this.
“Skype is a great standalone business.” That’s how eBay CEO John Donahoe described the company’s anomalous Internet telephony unit during its recent earnings call, and that remark is being interpreted by some as a signal that the online auctioneer is looking to unload it. Frankly, that wouldn’t be a bad idea.
If IBM and Apple, with their bullish earnings, are the flame of hope around which battered investors are huddling today, then eBay is the sopping wet blanket tossed over that flame. The online auctioneer reported fourth-quarter earnings Wednesday afternoon and they are dismal to say the least.
Good thing Wall Street’s expectations for eBay’s fourth-quarter earnings are low, because the online auctioneer is gearing up to post what many believe will be its first quarterly revenue decline in nearly 10 years. With its auction business slowing and the deepening recession playing havoc with its now year-old turnaround plan, 2008 has been a challenging year for eBay. So much so that analysts expect the company’s earnings per share to drop 11 percent for the quarter.
Consumers may not be buying as in years past, but they are browsing. Nielsen Online reports that traffic to online retail sites on Black Friday grew from 28.8 million unique visitors in 2007 to 31.7 million unique visitors in 2008. That’s 10 percent year-over-year growth. But what does it mean that Nielsen’s top-ranked Black Friday e-tailer was eBay, a site visited as often by people looking to sell things as buy them?
Concerns that the econalypse will last longer than expected inspired a nasty market selloff Wednesday, one that kicked tech’s ass all the way back to April 2003. The Nasdaq gave up nearly 97 points, falling 6.5 percent to 1,386, its lowest close in five years. And it dragged a host of tech issues down into the mud along with it.
Beyond the wet-your-pants whipsawing of the financial markets, the week ending Oct. 17, 2008, was one in which Apple figured prominently. On Tuesday, the company unveiled revisions to its MacBook Pro, MacBook and MacBook Air portables–as well as its new LED Cinema Display. It also issued a Steve Jobs health update: The Apple CEO’s blood pressure is 110/70.
John Paczkowski has been poking fun at the tech industry and the personalities that drive it since 1997. From 1999 to 2007, he wrote the award-winning tech news Web log Good Morning Silicon Valley for the San Jose Mercury News, Silicon Valley's daily newspaper. Read more »
Here is a statement of my ethics and coverage policies. It is more than most of you want to know, but, in the age of suspicion of the media, I am laying it all out.
Best use of the Beeker “meee” ever.
While the technology behind the Telephone is new, the design is reassuringly old-fashioned, reminiscent of a phrenologist’s horn or ear-candle in form. We found the experience far more comfortable than the one we had with the Telegraph.
12:58 AM: Breakfast: Two schools of fish from Tokyo Bay. Calories: 782,000. How I was feeling when I ate this: confused, irradiated, hating my size.
11:37 AM: Exercise: “Taxi Stomp” (alternating legs, for 30 blocks). Calories burned: 148,900,183.
1983. The Beatles announce their first tour in thirteen years, but likewise announce that Michael Jackson will be going on tour with them as a one gigantic mega-concert event.
Best video mashup ever.
A Facebook Memorial
Wow.
Worth it for the Rickrolling photo alone.
Excellent.
Flughumor!
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