Consumer Products

eBay Delivers on Earnings (EBAY)

Jon C. Ogg

Online auction giant eBay Inc. (NASDAQ: EBAY) has just reported is fourth quarter earnings ahead of expectations.  The company’s earnings were $0.52 EPS and revenues rose 5% to $2.5 billion (10% excluding Skype). Thomson Reuters had estimates of $0.47 EPS and $2.49 billion in revenues.

PayPal ended the quarter with 94.4 million active registered accounts, which it says was almost 1 million new accounts per month.  PayPal’s net total payment volume was $26.9 billion.

Marketplaces showed that gross merchandise volume (ex-vehicles) rose to $15.0 billion and sold items grew 10%.  eBay did offer up guidance as follows:

  • Q1 revenues of $2.4 to $2.5 billion with non-GAAP earnings of $0.44 to $0.46 EPS; Thomson Reuters has estimates of $0.45 EPS and $2.43 billion in revenues.
  • Full year 2011 revenues of $10.3 to $10.6 billion and non-GAAP earnings of $1.90 to $1.95 EPS; Thomson Reuters estimates are $1.85 EPS and $10.19 billion in revenues.

The company generated $854.0 million of operating cash flow and $656.5 million of free cash flow during the quarter, and it repurchased about $400 million of its common stock in the fourth quarter.

Cash and cash equivalents was listed as $7.8 billion at December 31, 2010 versus $5.2 billion at December 31, 2009. Keep in mind that eBay issued $1.5 billion in senior notes in the fourth quarter and it launched a commercial paper program allowing it to issue up to $1.0 billion in short-term notes.

eBay closed down 1.2% at $29.10 on the day and shares now seem to be up 5.5% at $30.69 in the after-hours trading session.  The 52-week trading range is $19.06 to $31.64.