eBay Earnings: Double-Digit Growth Again

S&P 500 (NYSE:SPY) component eBay Inc. (NASDAQ:EBAY) reported its results for the third quarter. eBay is an Internet company that, together with its subsidiaries, provides online marketplaces for the sale of goods and services. It also provides other online commerce platforms, online payment solutions, and communication offerings to a diverse community of individuals and businesses.

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eBay Inc. Earnings Cheat Sheet

Results: Net income for eBay Inc. rose to $597 million (45 cents per share) vs. $490.5 million (37 cents per share) in the same quarter a year earlier. This marks a rise of 21.7% from the year-earlier quarter.

Revenue: Rose 14.8% to $3.4 billion from the year-earlier quarter.

Actual vs. Wall St. Expectations: eBay Inc. fell short of the mean analyst estimate of 47 cents per share. Analysts were expecting revenue of $3.36 billion.

Quoting Management: “We had a great third quarter across our company, with Marketplaces and PayPal accelerating customer growth,” said John Donahoe, eBay Inc. President and CEO. “Mobile continues to be a game changer for us, and we continue to be a clear leader in mobile commerce and payments. With our strong portfolio and global reach, we are consistently demonstrating our capabilities to help consumers shop anytime, anywhere. And we are enabling retailers of all sizes to compete in a rapidly evolving, multichannel commerce environment.”

Key Stats:

The company has enjoyed double-digit year-over-year percentage revenue growth for the past five quarters. Over that span, the company has averaged growth of 26.8%, with the biggest boost coming in the fourth quarter of the last fiscal year when revenue rose 35.5% from the year earlier quarter.

The company has now seen its net income increase for three consecutive quarters. In the second quarter, net income rose more than twofold and in the first quarter, the figure rose 19.8%.

After beating analyst estimates for the two previous quarters, the company fell short of forecasts. In the second quarter, it topped the mark by 4 cents, and in the first quarter, it was ahead by 5 cents.

Gross margins widened last quarter, growing one percentage point from the year-earlier quarter to 70%. This snaps a streak of two consecutive quarters of shrinking margins.

Looking Forward: The average estimate for the fourth quarter remains unchanged at 61 cents a share. In the last thirty days, the average estimate for the fiscal year has moved up from $2.04 per share to $2.07.

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(Company fundamentals provided by Xignite Financials. Earnings estimates provided by Zacks)

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