How Did eBay’s Same Store Sales Compare With Amazon’s In August?
eBay (NASDAQ:EBAY) continued to report positive same-store-sales (SSS) growth for the fourth straight month in August 2016, owing to growth in eBay Motors (parts and accessories) sales and eBay Fixed-Price sales, which was partially offset by declining marketplace (auctions) sales. In comparison, Amazon (NASDAQ:AMZN) and Google Shopping (NASDAQ:GOOG) reported year-over-year SSS growth of around 10.5% and 43%, respectively.
Interestingly, Amazon’s SSS growth of 10.5% was lower than its average growth of 14.4% in the first six months of the year, largely driven by a sharp increase in competition among sellers, which was likely due to a substantial increase in the number of new sellers on its platform. The average e-commerce growth rate predicted by comScore for August 2016 was 15%. [1]
eBay Motors has consistently reported near double-digit growth rates in its same-store-sales in the last twelve months. This has helped eBay report overall positive SSS growth rates in the same period. In March 2016, eBay announced that it had acquired Cargigi Inc., a provider of online advertising and marketing services for the auto industry. The company believes that, through Cargigi’s technology, its eBay Motors dealers will be able to grow and manage their businesses, while enhancing buyers’ shopping experience. It will be interesting to see the impact of the acquisition on eBay Motors’ sales growth over the next few quarters. Read more here.
eBay Mid Year Earnings Recap
eBay has had some trouble competing with Amazon in the global e-commerce market in the last couple of years. This was reflected in the company’s first quarter results, with its global net marketplaces revenue falling 2.3% year-over-year (y-o-y) to $1.5 billion compared to Amazon’s 25% y-o-y growth to $26.6 billion in the same period. In the second quarter, the company’s revenue increased 6% y-o-y to $2.2 billion compared to Amazon’s 29% growth. eBay has especially been struggling in the domestic market, which contributes about 46% of its total marketplaces revenue, including the StubHub business.
In the third quarter, the company expects revenue between $2.16 billion and $2.19 billion, implying 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.
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Notes:- August 2016 ChannelAdvisor Same Store Sales (SSS), Channeladvisor.com, Sept 12 2016 [↩]