eBay Inc. Earnings Cheat Sheet: Beats Forecasts

S&P 500 (NYSE:SPY) component eBay Inc. (NASDAQ:EBAY) reported net income above Wall Street’s expectations 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 Earnings Cheat Sheet for the Third Quarter

Results: Net income for eBay Inc. rose to $490.5 million (37 cents per share) vs. $431.9 million (33 cents per share) in the same quarter a year earlier. This marks a rise of 13.6% from the year earlier quarter.

Revenue: Rose 31.8% to $2.97 billion from the year earlier quarter.

Actual vs. Wall St. Expectations: EBAY reported adjusted net income of 48 cents per share. By that measure, the company beat the mean estimate of 40 cents per share. Analysts were expecting revenue of $2.91 billion.

Quoting Management: “Our company reported another strong quarter, with eBay, PayPal and GSI each performing well,”said eBay Inc. President and CEO John Donahoe. “Mobile commerce continues to accelerate as consumers change the way they shop and pay. We expect eBay mobile commerce to generate almost$5 billion in merchandise volume this year and PayPal mobile to exceed $3.5 billion in payment volume. Mobile is one way online and offline shopping are blending into a single commerce environment. We are focused on enabling commerce, helping consumers shop anytime, anywhere,and being the commerce partner of choice for retailers of all sizes.”

Key Stats:

Gross margin shrank 2.5 percentage points to 69%. The contraction appeared to be driven by increased costs, which rose 43.6% from the year earlier quarter while revenue rose 31.8%.

Revenue has risen the past four quarters. Revenue increased 24.6% to $2.76 billion in the second quarter. The figure rose 15.9% in the first quarter from the year earlier and climbed 5.2% in the fourth quarter of the last fiscal year from the year-ago quarter.

The company has now beaten estimates the last two quarters. In the second quarter, it topped expectations with net income of 40 cents versus a mean estimate of net income of 39 cents per share.

The increase in profit last quarter comes after net income fell in the previous quarter. In the second quarter, net income declined 31.2% to $283.4 million.

Looking Forward: For next quarter, analysts have a more positive outlook about the company’s expected results. The average estimate for the fourth quarter is 51 cents per share, up from 49 cents ninety days ago. For the fiscal year, the average estimate has moved up from $1.68 a share to $1.70 over the last sixty days.

Competitors to Watch: Amazon.com, Inc. (NASDAQ:AMZN), GSI Commerce, Inc. (NASDAQ:GSIC), Liquidity Services, Inc. (NASDAQ:LQDT), Google Inc. (NASDAQ:GOOG), Overstock.com, Inc. (NASDAQ:OSTK), BIDZ.com, Inc. (NASDAQ:BIDZ), Gaiam, Inc. (NASDAQ:GAIA), U.S. Auto Parts Network, Inc. (NASDAQ:PRTS), HSN, Inc. (NASDAQ:HSNI), Wal-Mart (NYSE:WMT) and Target (NYSE:TGT).

Investing Insights: Amazon.com has a Stock Chart Technical Analysts Dream About.

(Source: Xignite Financials)