Inside eBay's Q3 Earnings Report.....

[kathieskorner]

Let's look at eBay's Q3 earnings report - good news for stockholders as earnings per share came in 3 cents above estimates while revenues were a hair above estimates.  eBay also claimed to have increased the number of active buyers by 4% to 183 million.   StubHub and Classifieds revenues were both up.  

However, on a closer look the picture is not quite as rosy as GMV was down 4%.  This means that sellers are paying eBay more for lower sales via managed payments ($500 million in payments processed in Q3 - 9.4% of all US sales)  and promoted listings revenue (up 119% and adding $103 million to ebay coffers).   

Oh, and by the way eBay repurchased $1.0 Billion in common stock in the quarter which helped inflate their EPS number.

Meanwhile Paypal grew revenue 19% in the quarter despite a drop from eBay transactions from 11% of their revenue to 8%.  

[chapeau-noir]

Funny thing about shell games - you can only move that bean around so often.

[4everctr]

Another billion dollars less in sales due to their bad decisions.   

[ten_o_nine]

EBay reported gross merchandise volume, the value of all goods sold on its platforms, of $21.7 billion, down 4.4% from a year earlier and the third straight quarterly decline. Schenkel blamed the slowdown partly on new internet sales tax laws taking effect in the U.S. More customers are abandoning purchases at the last minute -- particularly on higher-priced items -- when they see as much as 9% added to the total price because of sales taxes, he said.

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I think this started long before the internet sales tax, but I guess you can blame all your troubles on that ebay!!!

[eleanor*rigby]

@ten_o_nine 

Seriously.

How many times have you heard that a person went to checkout at a B&M store, had the clerk tell them the total, and then decided not to purchase the item? "Oh, changed my mind. Too much sales tax. I'll just go put this item back on the shelf."

How would eBay even know that's why the buyer didn't complete the transaction? There's not a survey asking why a buyer abandoned a purchase, is there? I've often put items in my cart and gone to the checkout page, only to change my mind at the last minute--and it doesn't have anything to do with the sales tax in my case. I pay sales tax in all B&M stores and have been paying sales tax on Amazon for two years or so, as well as other websites like Williams-Sonoma, Pottery Barn, Restoration Hardware, etc., for ages. 

I agree it's a pretty lame excuse, and one that doesn't hold up under any real scrutiny.

[3eyedfishcatcher]

Did eBay break down the total payments received through managed payments verses PayPal? It would be interesting to know which of the 2 are processing more sales credit cards directly through eBay or processed through PayPal. My guess would be user still prefer PayPal. Then it would be interesting to know if their managed payments is in the green or costing more money and in the red. Like are they ignoring lose hopping it gets better.

[gwzcomps]

A reputable corporation would never blame everyone else for their problems.

[gracieallen01]

So, while GMV  is down another 4%, but ebay revenue is up 'a hair' with Promoted Listings revenue up 119%, Stubhub and Classified both up.  I guess BODs, Elliott, et al, and major stockholders are, probably, at least content that they aren't loosing money.

If GMV is down, but ebay added somewhere around 4% more 'active' buyers, I wonder what they are buying and how much they are keeping?  I sure wish sellers could do as well.

[vintagecraze50]

That might be correct with the abandoning cart/purchase when the total comes up and there is the sales tax. It even shocked me a little bit becuase I am so used to not seeing that extra money tacked onto my purchase here. 

[vintagecraze50]

Now everybody has got to look at the price of their items and calculate what the buyer pays extra for in sales tax and then price the stuff with the competition with that in mind. Some people believe it or not are so cheap they will abandon a cart/purchase for a mere 5 dollars if someone else has it that much cheaper. LOL.

[gracieallen01]

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@ten_o_nine wrote:

EBay reported gross merchandise volume, the value of all goods sold on its platforms, of $21.7 billion, down 4.4% from a year earlier and the third straight quarterly decline. Schenkel blamed the slowdown partly on new internet sales tax laws taking effect in the U.S. More customers are abandoning purchases at the last minute -- particularly on higher-priced items -- when they see as much as 9% added to the total price because of sales taxes, he said.

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I think this started long before the internet sales tax, but I guess you can blame all your troubles on that ebay!!!

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There is the possibility that, when buyers see the tax being added on, they just may abandon the cart or sale.  For years, many have bought on-line to avoid tax and not report it to their state on their tax forms (Use Tax).

Still, I don't see how that reconciles with GMV down 4.4%, but active buyers UP 4%.  How can they be 'active' buyers if they are abandoning the sale and aren't paying for something.

[gracieallen01]

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@gracieallen01 wrote:

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There is the possibility that, when buyers see the tax being added on, they just may abandon the cart or sale.  For years, many have bought on-line to avoid tax and not report it to their state on their tax forms (Use Tax).

Still, I don't see how that reconciles with GMV down 4.4%, but active buyers UP 4%.  How can they be 'active' buyers if they are abandoning the sale and aren't paying for something.

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Or, is there  a new definition for 'buyer'?

[cashvaluerecovery2011]

How many of those 4% are scammers doing their thing with 50 accounts?

[cashvaluerecovery2011]

This is the buyer type you get when ebay advertises as the place to buy on the cheap. The latest commercial shows people laughing at brick and mortar store prices then goibg to buy on ebay. Now these cheapo buyers see prices with inflated shipping calculated in....20%-25% absurdly high fees with promted listings.....and now sales tax on top.

Of course people thinking its gonna be cheap here might run when they see reality.