eBay Inc. announced it’s Q2 2013 results this Wednesday with revenues of $3.9 billion, an increase of $200 million from previous quarter and non-GAAP earnings per share of $0.63.
Market had predicted that the virtual marketplace company would bring in revenues of $3.9 billion with EPS of $0.63 and ebay hit the bull’s eye with its results.
In its quarterly report, the company credited its growth to its marketplace, PayPal, and eBay Enterprise (formerly GSI Commerce) which combined grew 21 percent in Q2 2013 to $51 billion. The report highlighted the importance of each of these. John Donahoe, company President and CEO, said in a statement:
We had a strong second quarter, with $51 billion of enabled commerce volume across Marketplaces, PayPal and eBay Enterprise driving double-digit revenue and earnings growth.
Macroeconomic headwinds in Europe and Korea will continue to be a challenge in the second half of the year. But our core businesses are strong and we continue to attract millions of new customers each quarter through mobile innovation. We remain confident in our ability to meet our goals and drive global commerce innovation and leadership.
eBay Q2 2013 Results Highlights
Other selected Financial results:
- GAAP operating margin decreased to 19.3% for the second quarter of 2013, compared to 20.5% for the same period last year.
- NonGAAP operating margin decreased to 26.3% in the second quarter, compared to 27.3% for the same period last year.
- The company generated $1.0 billion of operating cash flow and $658 million of free cash flow.
- Year 2013-The company expects net revenues in the range of $16,000 – $16,500 million
- Q3 2013-The company expects net revenues in the range of $3,850 -$3,950 million
In 2013 Q2 eBay’s earnings were increased by good performance of its PayPal division, which brought in $1.5 billion in revenue, an 18 percent increase from Q4 2012. For the past three months, PayPal brought in $1.6 billion, a 20 percent increase and gained 4.7 million registered accounts, totaling 132 million, a 17 percent increase.
eBay Marketplace delivered revenue of $2 billion, a 10 percent increase. In Q2 2013, it gained 3.5 million active users, resulting in a total of 120 million, a 14 percent increase. In it’s quarterly report eBay believes that its Marketplace’s new search engine will help to enable smarter, faster, and more intuitive search experiences.
Looking ahead, eBay says that in Q3 2013, it expects to see revenues between $3.85 billion and $3.95 billion with non-GAAP EPS of $0.61 to $0.63.
With strong integration with PayPal, eBay looks strongly poised to keep its place as the world’s leading market place.The best strategy for eBay would be to avoid direct confrontation with Amazon and any other e-commerce retailer and to look for a strategic acquisition or partnership which would make eBay’s presence in the social web space more visible.