EBay Shares Fall on Disappointing Profit Outlook
The shares were sold at an average price of $33.25, for a total value of $221,445.00. The Zacks Consensus Estimate is pegged at $2.32 billion.
Net income jumped to $1.04bn, or 94 cents per share, from $482m, or 41 cents per share. During the quarter, the company generated $582.0M of operating cash flow and $447 million of free cash flow from continuing operations. "We just think this is a way to stick our competitive advantage right out there and have no questions about why people shop on eBay and why they should".
Top line growth was driven by a 15% increase in StubHub sales and a 6% increase in Marketing & Advertising revenue over the prior year quarter. Marketplace GMV grew 2% year over year on a reported basis and 5% on an FX-Neutral basis. StubHub drove GMV of $916 million, up 6%, and revenue of $210 million, up 18% on an as-reported basis and 19% on an FX-Neutral basis, aided by strength in global markets with the integration of the Ticketbis acquisition.
Classifieds platforms also performed well with contribution of $199 million of revenues, up 7% year over year on a reported basis and 10% on an FX-Neutral basis. Marketplace launched several new consumer experiences built on the foundation of its structured data efforts, coupled with continued investment in brand advertising, including the launch of a billboard and radio campaign across the United States.
The company is looking to improve its market perception and position this year, and is scheduled to launch two new programs over the next few months: 1) new authentication program for high-end goods; and, 2) guaranteed 3-day delivery program for about 20 million products on its website. Classifieds continued to enhance user experiences across its platforms, including launching a personalized homepage feed on Marktplaats.nl, as well as expanding its inventory integration with the eBay Marketplace platform across multiple regions.
Wenig also said the company is on the lookout for more partnership and acquisition opportunities, like its recent tie-up with Indian e-commerce company Flipkart.
Operating margin - GAAP operating margin decreased to 24.6% for the first quarter of 2017, compared to 28.7% for the same period previous year.
GAAP operating margin fell to 24.6% during the quarter vs. 28.7% a year ago.
Revenues of $2.2 billion beat the Zacks Consensus Estimate by a slight margin and came ahead of the company's guidance at the mid-point.
EBay is now replatforming itself and there was significant progress on this front in the first quarter. The company also repurchased $350 million of its common stock in the quarter, according to eBay.
eBay's balance sheet is highly leveraged, with total debt of $9 billion eclipsing cash and short-term investments balance of $6.8 billion.
Q1 revenue rose 3.7% to $2.2 billion, up 4% on an as-reported basis and 7% on a currency-neutral basis, according to a press release, in line with analyst expectations cited by Reuters for $2.21 billion.
04/13/2017 - eBay Inc. had its "buy" rating reiterated by analysts at Aegis Capital. The return on assets ratio of the Company was 34.60% while its return on investment ratio was 30.60%. Hedge funds and other institutional investors own 85.86% of the company's stock. M&T Bank Corp now owns 8,824,578 shares of the e-commerce company's stock valued at $290,330,000 after buying an additional 7,006,789 shares during the period.