eBay: Q2 earnings

Summary of eBay's earnings for its second quarter, following which shares went up 1% in post-market trading (9.17pm London time).

 

Revenue

Earnings per share

Expected

$4.39 billion

$0.68

Actual

$4.37 billion $0.69

 

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eBay has been able to announce a 13% increase in quarterly revenue to the market, as year-on-year it has increased from $3.88 billion to $4.37 billion. The company has kept its expectations for its third quarter at $4.3 billion.

The quarter has been dominated by cyber-attacks that have seen as many as 145 million customers’ accounts compromised, resulting in the share price falling by as much as 12% before finding some support. On top of this, the company has also found that competitors such as Amazon have upped their game. The company also had to deal with the knock-on effects of changes to the way that Google rankings worked, unfortunately to the detriment of its website.

In contrast to this, eBay’s online payment arm PayPal has seen rapid growth, and managed to more than make up for the disappointing performance of the online sales platform. PayPal saw its volume of business increase by 29%, which was driven by an increased sales values of 12%.

The company still envisages tough market conditions in the future, with one possible blip on the horizon being the imminent float of Chinese company Alibaba in August. This looks set to be the largest tech sector IPO in history, and when the company is finally quoted on the US exchange it will ensure that its brand awareness in the country will dramatically improve.

Questions about eBay’s future continue to hang over the company, as increased competition looks likely and improving PayPal returns are unlikely to able to cover this short fall in the longer term. The next obvious resistance will be the $53 level where both the 100- and 200-day moving averages are converging.

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