eBay (EBAY) Tops Q1 EPS by 7c; Issues Strong Q3 EPS Outlook

eBay (NASDAQ: EBAY) reported Q1 EPS of $0.77, $0.07 better than the analyst estimate of $0.70. Revenue for the quarter came in at $4.45 billion versus the consensus estimate of $4.42 billion.

PayPal net total payment volume (TPV) grew 18% in the first quarter to $61 billion, with Merchant Services volume up 26% and on-eBay volume down 1%. Payment volume through eBay Marketplaces was $15 billion, representing 24% of total TPV. Revenue grew to $2.1 billion. PayPal gained 3.6 million new active accounts in the quarter, up 11% to 165 million, and processed more than 1 billion transactions in the quarter, up 24%. PayPal deepened its customer engagement with transactions per active account increasing to 23 in the quarter and monetization per active account increasing to $49. The strong, steady growth of PayPal’s customer base coupled with rising engagement reflects the growing popularity and relevance of the PayPal value proposition globally. We announced two acquisitions to bolster and accelerate PayPal's ability to partner with merchants and deepen its trusted relationship with consumers. The acquisition of Paydiant helps PayPal extend its mobile value proposition to the offline world for merchants and consumers while its acquisition of CyActive strengthens PayPal's security capabilities and will act as the foundation of PayPal's new security center of excellence.

eBay Marketplaces gross merchandise volume (GMV) declined 2%, with the strengthening dollar significantly impacting results. In the U.S., GMV was up 2%, while International volume was down 4%, producing $2.1 billion in revenue. On a fx-neutral basis, International GMV was up 7% and global GMV was up 5%. Marketplaces gained 2.1 million new buyers in the quarter, up 8% to 157 million. While active buyer growth continued to decline on a rolling 12-month basis, we are seeing signs that our business is stabilizing, with both three-month active buyer growth and FX neutral GMV growth flat at 5% on a sequential basis. Sold item growth improved sequentially to 9%. We are continuing to invest to improve buyer and seller experiences and provide consistency across devices while building platform capability to improve traffic.

Guidance:

eBay sees Q3 2015 EPS of $0.71-$0.73, versus the consensus of $0.71. eBay sees Q3 2015 revenue of $4.4-4.5 billion, versus the consensus of $4.67 billion.

eBay sees FY2015 EPS of $3.05-$3.15, versus the consensus of $3.10. eBay sees FY2015 revenue of $18.35-18.85 billion, versus the consensus of $18.96 billion.

For earnings history and earnings-related data on eBay (EBAY) click here.

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