What To Expect From eBay Through 2018 After Robust Q1 Results?

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eBay (NASDAQ:EBAY) announced its first quarter results on April 25, reporting a 12% year-over-year increase in net revenue to $2.6 billion for the quarter. Growth came from both the transaction and marketing services businesses, which were up 11% and 14% to $2 billion and $557 million, respectively. Within the transactions segment, marketplaces revenues rose 11% to $1.8 billion, which was complemented by a 12% increase in StubHub revenues to $236 million. Similarly, within the marketing services segment, marketplaces revenues were up almost 10% y-o-y to $310 million with classifieds revenues surging 23% to $246 million. Growth in transaction revenues was driven by a 13% increase in gross merchandise volume (GMV) to $23.6 billion. Total GMV for both marketplaces and StubHub was up 13-14% to $22.6 billion and $1 billion, respectively.

eBay’s non-GAAP operating income was up 8% on a y-o-y basis to $721 million, with its operating profit margin compressing by around 1 percentage point to 27.9%. Resulting non-GAAP net income rose 2% to $548 million. However, share repurchases worth approximately $1 billion through the quarter helped push non-GAAP EPS by 8% on a y-o-y basis to 53 cents a share.

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Going forward, we expect both segments to sustain 9-10% revenue growth through the year. In addition, we expect margins to improve slightly through the year due to a limited increase in marketing and promotion expenses. We have created an interactive analysis, in which we have summarized our expectations for 2018. You can change expected segment revenue and margin figures for eBay to gauge how it will impact expected EPS for the year.

See our complete analysis for eBay

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