eBay Beats Q2 Estimates On Strong Top Line Growth, Cost Cutting

eBay (NASDAQ:EBAY) reported strong Q2 results on Wednesday, with revenue increasing 6% year-over-year (y-o-y) to $2.2 billion during the quarter, which beat the Reuters consensus estimate by $60 million. eBay’s earnings of $0.43 per share were up 1 cent per share over Q2 2015 results. Top line growth was driven by a 14% increase in Marketing & Advertising revenue, while a 3.4% decline in operating expenses helped improve net income over 400% y-o-y to $435 million in the quarter. The company’s revenue also got a boost from solid sales at StubHub, which grew 40% y-o-y to $225 million in this quarter.

eBay repurchased $500 million worth of its own shares in the quarter, and has approved an additional $2.5 billion worth of share repurchases going forward. In the third quarter, the company expects revenue between $2.16 billion and $2.19 billion, implying a growth of 3-4% over the same period last year. It also expects non-GAAP EPS of $0.42 to $0.44 per share, reflecting a decline of 2% to 7% y-o-y, driven by strength in the U.S. dollar and partially offset by positive impact of its share repurchase program. For full year 2016, the company expects sales of $8.85-$8.95 billion, against current consensus estimates of $8.81 billion. This top line guidance beat, along with robust Q2 operating income growth, helped the stock gain 5% following the earnings release. Have more questions about Ebay? Please refer to our complete analysis for Ebay

Global Large Cap | U.S. Mid & Small Cap | European Large & Mid Cap |More Trefis Research