Auctioneer eBay posts a third quarter loss despite higher auction sales
EBay Inc. reports that gross merchandise sales, or the value of all products sold at auction, increased by 14.2% in the third quarter to $14.4 billion from $12.6 billion in the same quarter last year. The number of active users rose by 3.9% and the number of product listings grew by 4.3%.
Total company revenue increased 30% to $1.89 billion from $1.45 billion in the year-ago quarter. But a previously disclosed charge against earnings related to its acquisition of Internet telephony service Skype resulted in a Q3 loss of $935.6 million. The company had net income $280.9 million in Q3 of last year. EBay disclosed plans for the Skype charge Oct. 1.
Despite the net loss, eBay is pleased with its third quarter performance. “During the third quarter we made significant progress against our business unit strategies which resulted in record net revenue of $1.9 billion,” says eBay president and CEO Meg Whitman. “EBay International, PayPal Merchant Services, StubHub, classifieds and our advertising businesses all performed above expectations.”
The number of active users, or those who have bid, purchased or listed an item on eBay within the past 12 months, rose to 83 million from 79.8 million a year ago, as the number of registered users rose to 247.6 million from 211.9 million.
The number of designated stores on eBay.com dropped 9.3% year-over-year in Q3 to 520,000 from 573,000. The number of inventory listings outside of eBay stores fell 3.1% year-over-year to 473.2 million from 488.3 million; the number of inventory listings in eBay stores fell 13.6% year-over-year to 82.4 million from 95.4 million.
Q3 revenue at eBay’s payments unit, PayPal, rose 34.3% year-over-year to $470 million from $350 million. The Q3 global total payment volume handled by PayPal grew 34% year-over-year to $12.2 billion.
Skype, eBay’s Internet-based communications unit, had 246 million registered user accounts at the end of Q3, up 81% from a year ago, and its Q3 revenue grew to $98 million. But eBay earlier said it will take a $1.43 billion charge in the third quarter related to Skype and replace Skype’s top executives. The $1.43 billion charge consists of a $900 million reduction in Skype’s book value and $530 million in payments to certain Skype shareholders to fulfill incentive clauses of the acquisition agreement.
EBay’s consolidated Q3 international revenue of $959.6 million accounted for 51% of net revenue, eBay says.
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