) reported its earnings for Q3 2012 on Wednesday. Revenues grew 15%
year-over-year to $3.4 billion and net profit increased to $718
million, up 14% year-over-year. The company credits its m-commerce
and mobile payment initiatives as the primary driver of growth.
Payment revenues once again led the growth with a 23% increase
while marketplace followed at 10%. eBay competes primarily
with Google (
), Square, Intuit GoPayment and other competitors in the payments
space, and Amazon (
) in e-commerce.
Check out our complete analysis of eBay
PayPal leads from the front
U.S. accounts for almost 48% of total PayPal revenues which
increased by 23% to $1.4 billion. It was partly due to a 20%
rise in TPV (Total Payment Volume) to $35 billion. The number of
active accounts on PayPal jumped 14% to 117 million. We expect it
to reach nearly 121 million by the end of 2012. PayPal Mobile
also continued its strong momentum in Q3, and the company expects
to do over $10 billion of mobile payments volume in 2012.
The company has been testing offline modes through its PayPal
Here device and announced a tie-up with Discover Financial Services
in Q3. It is currently present across 10 major U.S. retailers and
7,000 locations and is targeting 20 additional major retailers by
year-end. The growing popularity and adoption of PayPal Mobile
bodes well for the company which has often being accused of not
being innovative with its products. PayPal is currently
working to accelerate innovation by simplifying its product
organization and creating more agile development teams. A recent
announcement of it trimming its workforce by 400 was another step
in this direction.
Marketplaces pick up pace
Though Marketplaces still contributes a majority of eBay's total
revenues, it has been overshadowed by PayPal's blinding pace of
growth. Marketplaces' total gross merchandise volume
including vehicles increased to more than $18.3 billion, growing
about 9% year-over-year. The number of active users grew 10%
year-over-year to 108 million, the fastest growth since 2007.
Mobile was the fastest growing segment within Marketplaces with
800,000 new users making purchases on eBay Mobile during Q3.
Downloads of eBay Mobile apps topped 100 million, and the number of
items listed on eBay via Mobile also surpassed the 100 million
milestone during the quarter. Sellers are now listing 2 million
items per week from their smartphones on eBay.
In order to get rid of its image as an unorganized marketplace
and project itself as a provider of personalized, curated,
consistent and contemporary shopping experience, the company
recently refreshed its website and launched a new logo. The new
website contains innovative new features such as the eBay Feed
which provides personalized recommendations and we'd be looking for
its impact during Q4.
We currently have a
Trefis price estimate for eBay
, which is being revised.
a Post at Trefis Powered by Data and Interactive Charts
Drives a Stock at Trefis