Ina Steiner EcommerceBytes Blog
News and insight focusing on ecommerce.
by Ina Steiner, Editor of EcommerceBytes.com
Wed Oct 21 2015 16:35:06

eBay Releases Third Quarter 2015 Earnings

By: Ina Steiner

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eBay's conference call with analysts is at 5:00 pm EST today, here is the company's press release announcing third quarter 2015 earnings, you can view the full release with tables on eBay's investor relations website.

eBay Inc. Reports Third Quarter 2015 Results
eBay Inc. (Nasdaq: EBAY), a global commerce leader, today reported that gross merchandise volume (GMV) for the quarter ended September 30, 2015, increased 6% on a foreign exchange (FX) neutral basis, in-line with the prior quarter. Revenue for the quarter was $2.1 billion, driving non-GAAP net income from continuing operations of $529 million or $0.43 per diluted share, and GAAP net income from continuing operations of $545 million, or $0.45 per diluted share. The company repurchased $599 million of its common stock in the quarter, underscoring management's confidence in the long-term value of the business.

"We drove solid results in the quarter in which we completed a complex separation," said eBay Inc. President and CEO Devin Wenig. "We also marked eBay's 20th anniversary and made progress on executing our strategy to reposition the company to deliver stable and profitable long-term growth."

eBay Inc.'s commerce platforms continued to increase the role they play in global commerce, with an Active Buyer base that grew 5% year over year, to 159 million. GMV in the quarter was $19.6 billion, a 6% increase on an FX-Neutral basis and a 2% decline on an as-reported basis, reflecting the continued impact of a strong U.S. dollar. In the U.S., GMV grew 3%, a one point acceleration versus the prior quarter, and International GMV increased 7% on an FX-Neutral basis, while it was down 5% on an as-reported basis. Total revenue in the quarter of $2.1 billion was up 5% on an FX-Neutral basis and down 2% on an as-reported basis.

The eBay Classifieds and StubHub platforms both had strong quarters and continue to be key assets aligned with eBay's overall business strategy.

The quarter marked an important milestone for eBay as it celebrated its 20th anniversary with a number of activities, including a seller conference where significant upcoming changes to its seller policies and products were unveiled. These changes, which include more objective standards and a new Seller Hub, are intended to help small and medium sized sellers be even more successful on the eBay platform and better reward sellers who provide great service to eBay buyers.

During the quarter, eBay completed the distribution of PayPal and made progress against the completion of the sale of eBay Enterprise. Accordingly, the results of both PayPal and eBay Enterprise are presented as discontinued operations, appearing net of tax in a single line in the company's statement of income.

Other Selected Financial and Operational Results

Operating margin — GAAP operating margin decreased to 27.6% for the third quarter of 2015, compared to 27.7% for the same period last year. Non-GAAP operating margin decreased to 31.9% in the third quarter, compared to 32.8% for the same period last year.

Taxes — The GAAP effective tax rate for continuing operations for the third quarter of 2015 was 18.0%, compared to 17.0% for the third quarter of 2014. The non-GAAP effective tax rate for continuing operations for the third quarter of 2015 was 20.1%, compared to 19.8% for the third quarter of 2014.

Cash flow — The company generated $704 million of operating cash flow from continuing operations and $462 million of free cash flow from continuing operations during the third quarter of 2015.

Stock repurchase program — The company repurchased approximately $599 million of its common stock, or 21.9 million shares, in the third quarter. The company's total repurchase authorization remaining as of September 30, 2015 was $2.4 billion.

Cash and cash equivalents and non-equity investments — The company's cash and cash equivalents and non-equity investments portfolio totaled $8.0 billion as of September 30, 2015.

Business Outlook

Fourth quarter year 2015 — The company expects net revenues between $2,275 million to $2,325 million, representing FX-Neutral growth of 3% - 5%, with Non-GAAP earnings per diluted share from continuing operations in the range of $0.47 - $0.49 and GAAP earnings per diluted share from continuing operations in the range of $0.42 - $0.44.

Full year 2015 — The company is maintaining net revenue guidance of 3% - 5% growth on an FX-Neutral basis and increasing Non-GAAP earnings per diluted share from continuing operations to the range of $1.80 - $1.82 and GAAP earnings per diluted share from continuing operations to the range of $1.58 - $1.60.

Quarterly Conference Call and Webcast

eBay Inc. will host a conference call to discuss third quarter 2015 results at 2:00 p.m. Pacific Time today. A live webcast of the conference call, together with a slide presentation that includes supplemental financial information and reconciliations of certain non-GAAP measures to their nearest comparable GAAP measures, can be accessed through the company's Investor Relations website at https://investors.ebayinc.com. In addition, an archive of the webcast will be accessible for 90 days through the same link.

eBay Inc. uses its Investor Relations website at https://investors.ebayinc.com as a means of disclosing material non-public information and for complying with its disclosure obligations under Regulation FD. Accordingly, investors should monitor, in addition to following press releases, SEC filings, public conference calls and webcasts.

About eBay
eBay Inc. (NASDAQ: EBAY) is a global commerce leader including the eBay, StubHub and eBay Classifieds platforms. Collectively, we connect millions of buyers and sellers around the world, empowering people and creating opportunity through Connected Commerce. Founded in 1995 in San Jose, Calif., eBay is one of the world's largest and most vibrant marketplaces for discovering great value and unique selection. In 2014, eBay enabled $83 billion of gross merchandise volume. For more information about the company and its global portfolio of online brands, visit www.ebayinc.com.

Update: See Thursday's Newsflash for more information about eBay's third-quarter earnings call with Wall Street analysts, available here.




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Perminate Link for eBay Releases Third Quarter 2015 Earnings   eBay Releases Third Quarter 2015 Earnings

by: JQ This user has validated their user name.

Wed Oct 21 17:55:24 2015

Some bottom line numbers very conspicuously missing from the above press release:

Ebay GMV declined yet again by 2%.

Ebay marketplace revenue declined for the third consecutive quarter. It was down another 2%.

E-Commerce as a whole continued to grow at roughly 15%, so in actuality eBay's revenue is down 17% from where it would have been had the company performed at standard market level. This is the third consecutive quarter eBay's revenue has declined by more than 10% when adjusted to market standard performance.

Ebay continues to flounder. Nothing positive changed during this quarter. Up to this point there is no concrete evidence that Wenig's management team has been able to produce any positive change at eBay. The marketplace continues to perform as poorly as it did prior to the corporate split.

Perminate Link for eBay Releases Third Quarter 2015 Earnings   eBay Releases Third Quarter 2015 Earnings

by: Orwellwasright This user has validated their user name.

Wed Oct 21 18:04:58 2015


Quick ! lets suspend More Sellers!

lets institute more polices that favor the Chinese Junk dumpers so even more sellers are starved out

Its only been 7 years,  that stratagy will start working any day now,  never admit the ship is sinking even you're at the bottom of ocean

Perminate Link for eBay Releases Third Quarter 2015 Earnings   eBay Releases Third Quarter 2015 Earnings

by: pace306 This user has validated their user name.

Wed Oct 21 20:00:07 2015

Well, eBay continues down the SAME EXACT PATH as before.

THEN, the CEO had no real experience, and now ..... the NEW CEO also has no experience. Just how does the BOD sleep at night ...?

Oh yeh, they dont make money of stock movement, they just get bonus's ... smart move 'cause if it was matched to stock pricing .... they'de all go hungry.

Nothing this quarter has changed from LAST. eBay is still universally hated by almost everyone except the people making bucks off their illegal methods and games - as well as TOOLGUY.

All major eBay "systems" are exactly the same, the same bufoons are still in charge, eBays community boards are still highly censored, eBay is still making back room deals with certain large accounts, search still doesnt work right, theft and fraud are RAMPANT (for everyone EXCEPT TOOLGUY) and eBays GMV is down AGAIN.

eBay us STILL absent from most major industry shows, all the industry magazines STILL ignore eBay, and of course .... Paypal is still helping them steal from sellers.

Should be a BANG UP 4th quarter.

Perminate Link for eBay Releases Third Quarter 2015 Earnings   eBay Releases Third Quarter 2015 Earnings

by: maxmad This user has validated their user name.

Wed Oct 21 20:27:41 2015

Actually from all the info I am reading they are up 7%

They pick what items and sellers that make the most money for them, and them only, the rest are dead weight or just filler, and are 100% disposable, and if you don't like their policies or fee's they don't care, get out of line, meet the death squad, they have plenty of sellers to pick from.







 

Perminate Link for eBay Releases Third Quarter 2015 Earnings   eBay Releases Third Quarter 2015 Earnings

by: JQ This user has validated their user name.

Wed Oct 21 20:52:30 2015

madmax, you are reading the press release, which was written in such vague terms I could not make any sense of it. What I did was simply open the link Ina provided to the actual 2015 Q3 financial report and found the bottom line numbers in a couple of minutes. The Marketplace brought in over $500 million less than it did during 2014 Q3, which was a bit more than a 2% decrease in gross revenue.

Press releases are just public relations attempts to spin the actual numbers that are contained in the financial reports. It probably is best to not read the press reports and just look at the numbers.

Perminate Link for eBay Releases Third Quarter 2015 Earnings   eBay Releases Third Quarter 2015 Earnings

by: JQ This user has validated their user name.

Wed Oct 21 21:01:38 2015

Here are the bottom line numbers

GMV (Gross Merchandise Value, or the amount of stuff listed for sale on the site) declined YTY (comparing this quarter to the same quarter in 2014) declined by $433 million, or 2%.

Net revenue (the amount of revenue eBay receives from selling fees on the marketplace) declined by $51 million during the same period, also a 2% decline.

Perminate Link for eBay Releases Third Quarter 2015 Earnings   eBay Releases Third Quarter 2015 Earnings

by: maxmad This user has validated their user name.

Wed Oct 21 21:11:54 2015

@JQ

yes my mistake,  your right, -2%  

Perminate Link for eBay Releases Third Quarter 2015 Earnings   eBay Releases Third Quarter 2015 Earnings

This user has validated their user name. by: The End

Wed Oct 21 23:26:50 2015

Ebay shouldn't be focused on focusing.
Ebay needs to stand down, remove all the bells and whistles.
Go Plain Vanilla.
The sellers have a handle on their own policies and protocols.
List it, Sell it, get paid the sellers' way.
3% take rate.
GET TO WORK !

Perminate Link for eBay Releases Third Quarter 2015 Earnings   eBay Releases Third Quarter 2015 Earnings

This user has validated their user name. by: Shop and Ship

Wed Oct 21 23:34:23 2015

2% here, 2% there ... pretty soon we'll be talking about some real money: $500,000,000.00  

Perminate Link for eBay Releases Third Quarter 2015 Earnings   eBay Releases Third Quarter 2015 Earnings

This user has validated their user name. by: Ric

Thu Oct 22 00:38:46 2015

"eBay revenue fell 2% year-over-year..." a disaster regardless of the excuses offered up by eBay's new senior executive team.


"The dollar amount of goods sold by eBay's US sellers in the third quarter was only 3% higher than the third quarter of 2014." .... Factor increased shipping costs included in the selling price of fixed price transactions, and the reality is that sales are flat or in decline.

"The deceleration was driven by investments in increased seller promotions such as eBay Top Rated Seller and Daily Deals programs, the company explained."  So, with casual sellers declining, eBay volume is generated by Top Rated Sellers, so eBay is justifying 'deceleration' based in part on the discounts Top Rated Sellers receive. TRS sellers should expect that eBay will find new ways to deprive them of their hard earned discount in order to slow the 'deceleration'.

"Despite disruption by launching a new mobile experience, the percentage of GMV that closed on mobile still increased to 42% in the quarter, up 1% from last quarter."  Yet somehow, PayPal is telling a majority of sellers their mobile transaction volume is zero. Will anyone attempt to explain the conflicting data these two companies are stating?

"Talking very quickly in his presentation, Wenig outlined again for analysts his 3-pronged strategy and, referring to his last presentation in July, said "we are doing what we said we would do."

"The CEO presented information about its efforts to move toward structured data, which it said would help it leverage data to improve the user experience, SEO, merchandising, and the seller listing flow."

In other words, eBay allegedly has another long term plan for turning the marketplace around.  Sellers will no doubt recall the 3 year plan proposed by John Donahoe which over the course of 7 years produced zero positive results for buyers, for sellers, or for eBay.  Sounds much like the smoke and mirrors produced by the previous management - same song - just a different singer.


Perminate Link for eBay Releases Third Quarter 2015 Earnings   eBay Releases Third Quarter 2015 Earnings

by: CaddyShack This user has validated their user name.

Thu Oct 22 01:25:10 2015

I sell mostly vintage items, or items I pick up at a good price. I also do hand made wood items. My hats off to all the sellers that can make it selling new items. I don't know how you can compete with all the items coming in from China. They get free shipping thanks to our government and the postal service. We the american worker keep paying for and supporting other countries at our expense.

Perminate Link for eBay Releases Third Quarter 2015 Earnings   eBay Releases Third Quarter 2015 Earnings

by: flybuy This user has validated their user name.

Thu Oct 22 01:53:41 2015

Does Ebay take into account lot of people are selling via Facebook or Instagram? I am a vintage seller and when I ask around several ecommerce  acquaintances say they are selling more on IG than on Ebay or Etsy.    

Perminate Link for eBay Releases Third Quarter 2015 Earnings   eBay Releases Third Quarter 2015 Earnings

by: flybuy This user has validated their user name.

Thu Oct 22 01:54:52 2015

Does Ebay take into account lot of people are selling via Facebook or Instagram? I am a vintage seller and when I ask around several ecommerce  acquaintances say they are selling more on IG than on Ebay or Etsy.    

Perminate Link for eBay Releases Third Quarter 2015 Earnings   eBay Releases Third Quarter 2015 Earnings

by: blaumann This user has validated their user name.

Thu Oct 22 07:14:43 2015

Thya want to increase small sellers with unique items? Quit the insane suspensions. Remove listing fees. Stop stealing by tacking FVF from shipping. Quit trying to be Amazon.

Perminate Link for eBay Releases Third Quarter 2015 Earnings   eBay Releases Third Quarter 2015 Earnings

by: blaumann This user has validated their user name.

Thu Oct 22 07:21:44 2015

Just mayne they should stop throttling sales? Ebay is destroying itself.  

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This user has validated their user name. by: FEEbay

Thu Oct 22 07:53:18 2015

They are going away in 2016..... This is nonsense....

Perminate Link for eBay Releases Third Quarter 2015 Earnings   eBay Releases Third Quarter 2015 Earnings

by: SirRocko This user has validated their user name.

Thu Oct 22 07:57:29 2015

Anyone know how these numbers compare to Amazon?  I'm not even sure if Amazon has released their Q3 numbers yet.  

Perminate Link for eBay Releases Third Quarter 2015 Earnings   eBay Releases Third Quarter 2015 Earnings

by: serioussellers This user has validated their user name.

Thu Oct 22 09:06:05 2015

Is the GMV the total of all the actual dollar amounts that eBay buyers agreed to pay when they ''clicked'' to allegedly purchase something - whether they ever paid or not?  Or is it a total of the inflated/phony (alleged sales) amounts that eBay shows to viewers after ''sales'' (also whether or not the buyers ever paid)?  Or is it a total of actual amounts received from eBay buyers (including shipping)?  Or is it perhaps a magical and creative eBay assemblage of all or some of the above?

While considering which method (or combination) was creatively used by the eBay accounting wizards, an equally crucial question is ... what huge percentage of that needs to be deducted from ''total sales'' because of returns ''funny business'' &/or non-payments?

If you sell $800 gazillion, but your hard to please disappointed buyers/borrowers forced refunds totaling $400 gazillion, any touted alleged gains don't just get reduced a little bit, they get obliterated.

An accurate report & analysis of the real numbers would certainly more completely reveal the true catastrophe.

Based on the MANY detailed & credible reports on this site & elsewhere, the tsunami of fraudulent/manipulated/forced returns (that are so aggressively encouraged & enabled by eBay) virtually wipe out a huge chunk of the original ''sales'' totals.

[ Hypothetical Example: ]  If a customer saw a vintage studio art glass vase that was listed for $1,000, decided to put in a $600 offer when it was on a 2 day sale for $900, and then actually paid (after the struggling small ''blacked out'' seller accepted the $600 offer for the vase that had somehow been miraculously ''found'' on eBay), does eBay use the $600 amount ... or does it use the $900 amount that it fraudulently shows on its site as being the sold amount (making neophyte viewers think that they too can list their identical item & get $900) -- or does eBay stretch the truth even more and just document it as a $1,000 transaction?  The thrilled buyer then displayed the vase to enjoy &/or impress for a week or two (or, as often happens, possibly for MONTHS) ... then claimed it was not as described because the base's diameter (measured with the buyer's plastic ruler) was allegedly 1/16'' larger than described in the listing.  So the suddenly unhappy and disappointed buyer decided that it did not properly fit -- or did not look as good as planned/desired -- on the base on which it had been displayed for a couple of weeks/months.  Somehow, the buyer's outraged claims to the eBay/PayPal consortium got the buyer the (planned/desired) almost instant ''forced'' refund.  Perhaps the suddenly unhappy buyer (who had left positively glowing feedback within days of displaying their new treasured vase) got to keep the vase as well.  Perhaps it was returned, or perhaps a crummy ''substitute'' vase -- or a box of rocks -- was sent back.  Perhaps the seller never even knew that anything was happening because eBay's messages about the case disappeared into an eBay message black hole, instead of being promptly delivered to the seller's inbox.  There are so many possible variations of this all too common scenario.  Perhaps the seller's PayPal/credit card/bank account suddenly showed an unexpected $600 debit (prompting the seller to make some calls about this financial mystery) , perhaps the seller's exceptional seller ''ratings'' took an unmerited ''hit'', perhaps the buyer continued the thrilling buying/borrowing spree with dozens of other sellers, etc.  ..... It doesn't really matter .... since all the variations reveal the same basic ecommerce tragedy/disaster.

So, in the big picture, it doesn't truly matter whether in this hypothetical example eBay uses $600, $900 or $1,000 when calculating GMV..... but does anyone know which one eBay would claim to use?

And, regardless of which they use, have they ever revealed the total ''deductions'' due to returns (and due to non-payments, if they included amounts in their GMV total of items that were ''sold'' but remained unpaid) ??  

Perminate Link for eBay Releases Third Quarter 2015 Earnings   eBay Releases Third Quarter 2015 Earnings

by: Volvo351 This user has validated their user name.

Thu Oct 22 09:32:44 2015

Lemmie try to work through the deliberately-confusing SPIN: eBay's biz is OFF 2%, in US dollars, but they're saying it's "really" UP due to a strong dollar? Is that the translation of Devil Wingnut's double-talk? IOW, if it weren't for the OIL BOOM that's strengthened the greenback relative to world currencies, Wingnut would have to flat-out ADMIT failure? But, he's got a cover story, and he's stickin' to it?

If I've failed to properly interpret the gobbledygook being spewed by eBay's current unqualified CEO, someone please fill me in.

Perminate Link for eBay Releases Third Quarter 2015 Earnings   eBay Releases Third Quarter 2015 Earnings

by: Volvo351 This user has validated their user name.

Thu Oct 22 09:39:37 2015

OH, lemmie tell you something about that so-called "active buyer base" - I presume that includes my recent buyer from the island of Malta who hadn't made an eBay purchase [judging from FB record] in over a year. I am WAITING for a payment and a confirmed US shipping address. I don't know Malta from East Borneo, and I wouldn't ship THERE, either. Wanna bet that Devil counts this guy as "active?" On WHAT basis?

Their metric of "active buyers" has about as much credibility as the rest of the nonsense they spew.

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