eBay Q1 results and conf call thoughts…

April 16, 2008

ChannelAdvisor ChannelAdvisor By ChannelAdvisor

eBay’s Q1 results were out this evening and the company hosted a conference call with analysts to answer their questions.

Note that the PayPal and Skype businesses are doing very well, the focus on this post is the marketplace business.

The most interesting part of the day was the verbal comments of the call.

  • JD talked about the changes to fees and BestMatch and how the early indications are that they are working.  Specifically he said that listings are up, conversions are holding/down slightly, completed transactions are up and thus GMV is up.
  • In the Q+A they said they are focused less on getting new buyers, but more on generating more gmv/existing active user.
  • They also talked a good bit about couponing whenever they see active buyers slow down or start to leave to keep them.

The bullish comments were not really supported by the Q1 marketplace data:

  • While GMV grew 12% y/y, when you peel the onion, there were some negatives.
    • GMV Q/Q was down 1%
    • The US marketplace business grew at 7% y/y
    • The international marketplace business grew at 8% y/y when you take out the benefit of foreign exchange (FX).  I’ll have to check, but I think this is a material deceleration on the International business.
    • Remember that e-commerce is growing at 17-20% y/y in the US and even faster Internationally so this indicates that eBay is losing share overall (it will be interesting to see what Amazon reports).

Active users came in at a paltry 83.9m.  You can see the active user trend in this chart:


More telling is the y/y growth expressed as a %:


Over the course of the year it’s going to be interesting to see if eBay can get the GMV to grow (using the existing active buyers) and then from there see if they can accelerate the active buyer growth again.