Ina Steiner EcommerceBytes Blog
News and insight focusing on ecommerce.
by Ina Steiner, Editor of EcommerceBytes.com
Wed Jan 16 2013 16:21:06

eBay Sees 19 Percent Increase in Q4 GMV for US

By: Ina Steiner

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eBay announced fourth quarter 2012 earnings today, January 16, 2013. eBay's conference call with analysts is at 5:00 pm EST, here is the company's press release, you can view the full release with tables on the eBay investor website.

eBay Inc. Reports Strong Fourth Quarter and Full Year 2012 Results
Net Income up Double Digits in 2012 on Record Revenue

SAN JOSE, Calif. - eBay Inc., a global commerce platform and payments leader (NASDAQ:EBAY), today reported that revenue for the fourth quarter ended December 31, 2012 increased 18% to $4.0 billion, compared to the same period of 2011. The company reported fourth quarter net income on a GAAP basis of $751 million, or $0.57 per diluted share, and net income on a non-GAAP basis of $927 million, or $0.70 per diluted share. The increase in non-GAAP earnings per diluted share was driven by double digit user growth across the portfolio, strong gains in mobile adoption, and accelerating growth in the company's Marketplaces business, reflecting a 19% increase in U.S. gross merchandise volume (GMV), excluding vehicles.

For the full year, revenue increased 21% to $14.1 billion, compared to 2011. The company reported net income on a GAAP basis of $2.6 billion, or $1.99 per diluted share, and net income on a non-GAAP basis of $3.1 billion, or $2.36 per diluted share. eBay Inc. enabled more than $175 billion of commerce volume (ECV) in 2012, representing growth of 18%. ECV is the total commerce and payment volume across all three business units consisting of Marketplaces GMV, PayPal merchant services net total payment volume and GSI global ecommerce (GeC) merchandise sales.

"We had a great finish to an excellent year, with fourth quarter results exceeding our expectations," said John Donahoe, eBay Inc. President and CEO. "eBay Marketplaces in particular had a terrific fourth quarter, with growth in the U.S. accelerating three points, outpacing ecommerce."

"Mobile continues to rewrite the commerce playbook, and we continue to be a mobile commerce and payments leader," Donahoe said. "eBay mobile finished the year with $13 billion in volume - more than double the prior year - and PayPal mobile handled almost $14 billion in payment volume, more than triple the prior year. In 2013, we expect each to exceed $20 billion."

"Web-enabled multichannel commerce is evolving quickly, and consumer shopping behavior is changing rapidly. Our focus is on being a global commerce leader in this new environment, connecting buyers and sellers everywhere, and being a preferred multichannel partner of choice for retailers and brands of all sizes."

The company's PayPal business continued to expand its leadership position in global payments. PayPal's active account growth accelerated to 15% and ended the year with approximately 123 million registered accounts. PayPal added nearly 2 million accounts a month in the fourth quarter, representing the company's fastest active account growth rate in years. Net total payment volume (TPV) increased 24%, producing revenue growth of 24%. Key drivers included continued merchant and consumer adoption coupled with geographic expansion. PayPal's mobile payment volume reached nearly $14 billion in 2012, up more than 250% over the prior year, as more consumers used their smartphones and tablets to pay online. In addition, PayPal continued to invest in future growth initiatives and made significant progress towards the rollout of its offline payment solutions. Twenty-three major retailers adopted PayPal's offline payment solutions in 18,000 locations in 2012.

The company's Marketplaces business delivered a record $2 billion revenue in the fourth quarter, propelled by strong performance in the U.S. Revenue for the full year was driven by continued investments in the customer experience and efforts to bring the world's inventory to global buyers. Active user growth accelerated two points to 12%, driven by mobile, site enhancements designed to streamline the shopping experience on eBay and emerging markets. Fixed price GMV, excluding vehicles, increased 21% and contributed to a 16% increase in GMV, excluding vehicles. U.S. GMV growth, excluding vehicles, accelerated three points to 19%. Mobile commerce volume in 2012 grew more than 120% to $13 billion driven primarily by increased adoption of eBay's mobile apps and increased engagement from product innovation. eBay's suite of mobile apps attracted more than 4 million new customers in 2012.

GSI revenue for the quarter increased 10% to $398 million driven primarily by a 17% increase in GeC merchandise sales. Same store sales grew 19% outpacing ecommerce. For the full year, GSI shipped a record 146 million units for its clients. GSI contributed revenue of $1.1 billion in 2012, as GSI continued to grow its relationships, investing and driving value to its clients through eBay Inc. technology solutions, including mobile app development, buy online and pick up in-store and mobile express checkout.

Other Selected Financial Results

Operating margin — GAAP operating margin decreased to 21.9% for the fourth quarter of 2012, compared to 22.3% for the same period last year. Non-GAAP operating margin decreased to 28.5% for the quarter, compared to 28.7% for the same period last year. The decrease in GAAP operating margin and non-GAAP operating margin was due primarily to the impact of acquisitions and business mix.

Taxes — The GAAP effective tax rate for the fourth quarter of 2012 was 14%, compared to 19% for the fourth quarter of 2011. For the fourth quarter of 2012, the non-GAAP effective tax rate was 18% compared to 20% for the fourth quarter of 2011. The decrease in the GAAP effective tax rate was due primarily to U.S. taxes on the sale of the remaining equity interest in Skype in the fourth quarter of 2011.

Cash flow — The company generated $1.4 billion of operating cash flow and $1.1 billion of free cash flow during the fourth quarter. For the full year the company generated $3.8 billion of operating cash flow and $2.6 billion of free cash flow.

Stock repurchase program — The company repurchased approximately $256 million of its common stock in the fourth quarter.

Cash and cash equivalents and non-equity investments — The company's cash and cash equivalents and non-equity investments portfolio totaled $11.5 billion at December 31, 2012.
   
PayPal customer balances — The company now holds PayPal U.S. customer balances directly, rather than as a custodian for its customers. As a result, PayPal U.S. customer balances and the associated customer liability are now reflected on the company's consolidated balance sheet, contributing to the $8.1 billion balance in funds receivable and customer accounts at December 31, 2012.

Restructuring — The company incurred restructuring charges of $31 million during the fourth quarter of 2012 related to work force reductions designed to simplify and streamline its organization and strengthen the overall competitiveness of its existing businesses.

Business Outlook
First quarter 2013 — eBay expects net revenues in the range of $3,650 - $3,750 million with GAAP earnings per diluted share in the range of $0.48 - $0.50 and non-GAAP earnings per diluted share in the range of $0.60 - $0.62.

Full year 2013 — eBay expects net revenues in the range of $16,000 - $16,500 million with GAAP earnings per diluted share in the range of $2.23 - $2.29 and non-GAAP earnings per diluted share in the range of $2.70 - $2.75.


See Thursday's EcommerceBytes Newsflash story for more information on eBay earnings and its post-conference call with analysts.
 




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Perminate Link for eBay Sees 19 Percent Increase in Q4 GMV for US   eBay Sees 19 Percent Increase in Q4 GMV for US

by: AgendaSwallowsAll This user has validated their user name.

Wed Jan 16 17:01:59 2013

And I've just gained full rights to sell the Brooklyn Bridge but I'm not selling it on ebay.

Perminate Link for eBay Sees 19 Percent Increase in Q4 GMV for US   eBay Sees 19 Percent Increase in Q4 GMV for US

This user has validated their user name. by: Philip Cohen
Web Site

Wed Jan 16 17:04:25 2013

"eBay Marketplaces in particular had a terrific fourth quarter, with growth in the U.S. accelerating three points, outpacing ecommerce."

Just show us where that marketplace growth is coming from because there is no sign of it in the “Completed listings” …

"Mobile continues to rewrite the commerce playbook, and we continue to be a mobile commerce … leader," Donahoe said.

Any mobile “success” will likely be coming off the desktop …

“The company's PayPal business continued to expand its leadership position in global payments.”

What! PreyPal has about one percent of the payment business. How can this turkey possibly claim leadership on that basis?

“The company now holds PayPal U.S. customer balances directly, rather than as a custodian for its customers”

No FDIC deposit insurance for you … not that there ever was any in this clunky “pretend bank” …

Yet another load on nonsensical spin full of smoke and mirrors dreamed up by the eBafia Don on yet another of his dreamtime trips down the rabbit hole to Wonderland …

eBay / PayPal / Donahoe: Dead Men Walking

Perminate Link for eBay Sees 19 Percent Increase in Q4 GMV for US   eBay Sees 19 Percent Increase in Q4 GMV for US

by: Massachusets Howler This user has validated their user name.

Wed Jan 16 17:31:13 2013

No surprise. GSI now at 10%.
WHAT IS THIS about paypal holding funds directly- anybody know what this change means?
Mass Howler

Perminate Link for eBay Sees 19 Percent Increase in Q4 GMV for US   eBay Sees 19 Percent Increase in Q4 GMV for US

This user has validated their user name. by: Philip Cohen
Web Site

Wed Jan 16 18:47:15 2013

@Howler,

I can only assume it means that PreyPal users’ funds were previously held in a form of “trust” account (with the infamous Wells Fargo Bank), where PreyPal users were not covered by FDIC insurance (only PreyPal was covered by such insurance in the case of the failure of Wells Fargo), and now the funds are being held by PreyPal in a general account as general revenue (much easier to apply creative accounting processes that way), and still PreyPal users are not covered by any FDIC insurance if the PreyPal “pretend bank” fails as PreyPal is not a licenses “bank” and therefore does not quality for such insurance … In the event of the PreyPal pretend bank failing, I presume PreyPal users will (still) become simply unsecured creditors, but their funds wont be readily identifiable as they would have been in a separate account … That’s my guess …

eBay / PayPal / Donahoe: Dead Men Walking

Perminate Link for eBay Sees 19 Percent Increase in Q4 GMV for US   eBay Sees 19 Percent Increase in Q4 GMV for US

This user has validated their user name. by: Ming the Merciless

Wed Jan 16 20:47:01 2013

There can be NO doubt whatsoever that the corporate Wall Street cabal has reached unparalleled criminal collusion and must be investigated by US Justice Department for the organized widespread criminal conspiracy that it is.

CNBC comments today that "ebay guidance is always solid." Stock price creeps steadily upward, and most analysts give ebay a buy rating.

13%? About ebafia's take on stealing a fee from sellers' shipping costs and fake "profits" from returned items sold a second time.

Smoke, mirrors, and blatant fraud and dishonesty. No actual growth -- just a constant, deceptive remixing of various marketplaces over and over and 'creative' reshuffling of funds.

For Wall Street to have bought into the claims of The Ho's criminal enterprise for the last five years can only mean they're nothing more than dishonest pimps helping to rob honest investors of their money by failing to report the truth rather than the pack of lies ebafia feeds them quarterly.

No wonder so many justifiably label these sociopathic 'analyst' parrots as banksters.

This is 21st century bank robbery, and the victims are sellers who have NO protections whatsoever from these corporate and media criminals.


Perminate Link for eBay Sees 19 Percent Increase in Q4 GMV for US   eBay Sees 19 Percent Increase in Q4 GMV for US

by: Bloggo This user has validated their user name.

Wed Jan 16 21:12:57 2013

ebay 2013 strategy: Pump and dump.

Perminate Link for eBay Sees 19 Percent Increase in Q4 GMV for US   eBay Sees 19 Percent Increase in Q4 GMV for US

by: Digmen1 This user has validated their user name.
Web Site

Wed Jan 16 21:13:11 2013

Ebay looks to be holding its own place in the market. While Amazon just keeps rising.

How can JD rattle off so much good news when there is a recession on?

Oh well he does a better job than the same old tired posters that rattle off the same old tired responses.

It would be nice to hear from some other people, what do they think of ebay's results?

Perminate Link for eBay Sees 19 Percent Increase in Q4 GMV for US   eBay Sees 19 Percent Increase in Q4 GMV for US

This user has validated their user name. by: bitbybit

Wed Jan 16 21:51:54 2013

@Digmen1

Thanks for your unbiased opinion.

Just reading between the lines.

Perminate Link for eBay Sees 19 Percent Increase in Q4 GMV for US   eBay Sees 19 Percent Increase in Q4 GMV for US

This user has validated their user name. by: Anonymous Annie

Wed Jan 16 23:02:44 2013

Ha! MY year-over-year increase for the last holiday season was about two-and-a-half times more than eBay's!

I'm doing BETTER THAN EBAY... **WITHOUT** eBay!

Perminate Link for eBay Sees 19 Percent Increase in Q4 GMV for US   eBay Sees 19 Percent Increase in Q4 GMV for US

by: pace306 This user has validated their user name.

Wed Jan 16 23:27:38 2013

''PayPal customer balances — The company now holds PayPal U.S. customer balances directly, rather than as a custodian for its customers. As a result, PayPal U.S. customer balances and the associated customer liability are now reflected on the company's consolidated balance sheet ''

LMFAO! ''in english'' ... eBay is now counting the money Paypal has in its balance sheets (sellers funds) as THIER income/revenue!

Isnt that counting the same funds 2x - 1x under eBay and 1x under Paypal ?

The sheer amount of fraud is mind boggling. Its one huge Ponzi scheme .. the moneys here, no its there, no its here, no its there!

Its a Madoff Moment .... wheres Jim Cramer when you need him?!

Perminate Link for eBay Sees 19 Percent Increase in Q4 GMV for US   eBay Sees 19 Percent Increase in Q4 GMV for US

This user has validated their user name. by: iheartjacksparrow

Wed Jan 16 23:33:28 2013

JD says: "eBay Marketplaces in particular had a terrific fourth quarter...." That seems to be a contradiction with what sellers have been saying about their sales tanking.

Perminate Link for eBay Sees 19 Percent Increase in Q4 GMV for US   eBay Sees 19 Percent Increase in Q4 GMV for US

This user has validated their user name. by: Sales Smith

Thu Jan 17 01:47:47 2013

Is it just me or did anyone else capture the smell of books cooking?

It's hard to believe ebay claims such growth. Considering ebay sales continue to be reported as ''weak'' for so many merchants.

Undoubtedly the day will come where JD runs out of creative book keeping options, until then many of us will continue to expose ebay for what they are.

Each month, we see our website growth increase while our ebay sales continue to decline.

Speaking from my own experience, I would prefer ebay to collapse soon than continue hearing about the collateral damage and carnage they leave behind as they run roughshod over their long term sellers.

As Neil Young has sung:
Oh... the damage done.

Perminate Link for eBay Sees 19 Percent Increase in Q4 GMV for US   eBay Sees 19 Percent Increase in Q4 GMV for US

This user has validated their user name. by: Marie

Thu Jan 17 02:42:47 2013

@ Mass Howler

WHAT IS THIS about paypal holding funds directly- anybody know what this change means?
-------------------------

Some time in the past year or two, there was a huge uproar against PP from members that were having holds put on their money in PP.  PP would frequently move the held money into accounts that generated interest, but of course whatever interest earned was never passed onto the member having their money held, PP of course kept it for themselves.

Under the threat of a huge law suit, PP agreed in writing NOT to move the money into interest bearing accounts any longer.  

------------------

All this growth by Ebay makes no sense to me.  So many people are reporting the lack of sales.  Of course their new fee on S&H is certainly a huge help to their bottom line since it is PURE profit for them.  They never added any new service for this new very steep fee.  In fact they laid off some customer service people as they no longer monitored excessive shipping fees any longer, but in reality they didn't do much about it before this change anyways.

Perminate Link for eBay Sees 19 Percent Increase in Q4 GMV for US   eBay Sees 19 Percent Increase in Q4 GMV for US

by: Bloggo This user has validated their user name.

Thu Jan 17 02:54:15 2013

''hear from some other people''
Reuters, Yahoo and various other sites have articles on ebay's Q4 report. Though the articles I've read so far seem more like Press Releases than any sort of real analysis, the Wall Street perspective is quite easy to find, if you care to take a moment to look.
Here, you're just going to find commentary from people that actually use ebay.

Perminate Link for eBay Sees 19 Percent Increase in Q4 GMV for US   eBay Sees 19 Percent Increase in Q4 GMV for US

This user has validated their user name. by: Philip Cohen
Web Site

Thu Jan 17 04:04:32 2013

@Bloggo,

''hear from some other people'' …

There are no longer any investigative journalists/analysts; now, the majority of them are no more than uncritical regurgitators of media releases from corporate departments of spin; eBay being one of the finest producers of arrant nonsense; still, you are entitled to believe the nonsense that habitually spews forth from them if you wish; I prefer to believe what I can see with my own eyes …

And the people here comment from first hand personal experience …

Regardless, Wall Street knows that this rusting old hulk, that Captain Ho keeps driving onto the rocks, is going nowhere, and that knowledge is reflected in the now great difference between the share prices of eBay and Amazon; in late 2007, before the cretinous Ho took the helm of eBay, they were both ~$40 …

So, if you think that eBay’s financial reporting is on the level then maybe you should be doing some long term investing in eBay stock; that would help to counter the only other people buying eBay stock, the day-trading speculators …

Remember Enron …

eBay / PayPal / Donahoe: Dead Men Walking

Perminate Link for eBay Sees 19 Percent Increase in Q4 GMV for US   eBay Sees 19 Percent Increase in Q4 GMV for US

by: LadyElizabeth This user has validated their user name.

Thu Jan 17 09:15:48 2013

Ever since eBay began to charge a fee on shipping costs, earnings have gone up. You're welcome, eBay.

Perminate Link for eBay Sees 19 Percent Increase in Q4 GMV for US   eBay Sees 19 Percent Increase in Q4 GMV for US

by: Bloggo This user has validated their user name.

Thu Jan 17 11:35:18 2013

@ Philip Cohen - I totally agree with you, that's why I used the term ''press releases''.
''uncritical regurgitators'' is more accurate though.
Any investor that takes ebay's word at face value is a moron.

Perminate Link for eBay Sees 19 Percent Increase in Q4 GMV for US   eBay Sees 19 Percent Increase in Q4 GMV for US

by: ebay refugee camp This user has validated their user name.

Thu Jan 17 12:00:17 2013

I think maybe some creative cooking of the books is the situation with the paypal funds, I cannot help but wonder is this not counting your eggs twice, it is a little confusing. I am noticing a uptick in sales on all of my venues. As far as mobile shopping goes how are we going to tell? It does not say this shopper bought this item on their iphone. The numbers reflect nothing more than the increase in online shopping as a whole and Donhoes courting of big business and the advertisements in your listings that ebay is getting paid for.

Perminate Link for eBay Sees 19 Percent Increase in Q4 GMV for US   eBay Sees 19 Percent Increase in Q4 GMV for US

by: Digmen1 This user has validated their user name.
Web Site

Thu Jan 17 12:21:57 2013

Yes I have always said it would be nice of ebay would publish the actual number of items sold each quarter.

That would have given us a solid figure on which to basis our analysis.
They must have these figures, but they chose not to publish them.
Don't get me wrong I don't like ebay anymore than the next man.

Perminate Link for eBay Sees 19 Percent Increase in Q4 GMV for US   eBay Sees 19 Percent Increase in Q4 GMV for US

by: Bloggo This user has validated their user name.

Thu Jan 17 13:36:17 2013

What's the big deal about Mobile? Desktop or Laptop or Mobile. A sale is a sale.  

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