Retailers shift their ad spending from TV, radio and print ads to digital ads.
The value of merchandise sold on the eBay marketplace rose 6% year over year in the third quarter, as revenue rose 7%, marking the first time in a year that quarterly gross merchandise sales and revenue increased.
The value of merchandise sold on the eBay marketplace rose 6% year over year in the third quarter ended Sept. 30, as revenue rose 7%, marking the first time in a year that quarterly gross merchandise sales and revenue increased. The company’s payments unit, including PayPal and Bill Me Later, continued to show strong growth.
“We are seeing our turnaround efforts begin to pay off,” eBay CEO John Donahoe said yesterday in announcing the results. “While we still have a lot more work to do to improve trust, value and selection, we are making progress.”
In its Q3 release, eBay reported:
- The value of goods sold through eBay’s online marketplaces, excluding autos, rose 7% in the third quarter to $12.2 billion from $11.4 billion in the same quarter last year. That gross merchandise value figure had declined 10% in the second quarter, 16% in the first quarter and 12% in the last quarter of 2008. 56% of marketplace revenue was from outside the U.S. U.S. online marketplace volumes fell 5% to $5.3 billion from $5.6 billion a year ago.
- Sales of items at fixed price grew 19% year over year and 7% from the first quarter, reflecting eBay’s shift away from the auction format as more large retailers use eBay as a sales platform. Fixed price represented 56% of marketplace volume compared to 46% a year earlier.
- Active users of eBay’s marketplaces totaled 89.2 million as of Sept. 30, up 2% from 87.2 million a year earlier, but little changed from 88.4 million as of June 30. (Active users are those who have listed or bought on eBay in the previous 12 months.)
- Payment volume increased 19% year over year to $17.7 billion, of which 56% came from the company’s merchant services unit that handles online payments for e-retailers. Payments with eBay’s PayPal online payment service account for the majority of the rest, with Bill Me Later accounting for 1% of total payment volume. EBay last year acquired Bill Me Later, which enables merchants to offer delayed payment options, such as paying in 90 days without interest charges.
- Active users of eBay’s payment services, which include consumers with PayPal or Bill Me Later accounts, increased 19% year over year to 78 million. Forty-four of the top U.S. retail sites offer PayPal and 24 offer both PayPal and Bill Me Later, eBay CEO Donahoe told analysts yesterday. This week eBay announced the integration of Bill Me Later into the PayPal wallet on both eBay and across e-commerce.
- The eBay iPhone app has been downloaded more than 4 million times and it and its m-commerce web site counterpart are expected to generate more than $500 million in merchandise sales this year, the company reported.
- EBay’s total Q3 revenue rose 6% to $2.24 billion from $2.10 billion a year ago. Q3 net income was $350 million, a 29% decline from $492 million a year earlier.
Analyst Colin Sebastian, who follows eBay and other e-commerce stocks for Lazard Capital Markets, says eBay’s Q3 results show signs of a “gradual turnaround taking place at eBay” as the company emerges as a “smaller, more nimble and highly profitable platform for online commerce,” Sebastian wrote in a note to clients today.
Last week eBay confirmed plans to lay off about 60 employees as part of an internal restructuring plan first announced in a Sept. 21 post on its eBay Ink blog. As part of the restructuring, Lorrie Norrington, president of eBay marketplaces, will assume direct responsibility for eBay`s North America operations.