Ebay beat the Street’s expectations for Q2 earnings, reporting profits of 40 cents a share (or $530.2 million) on revenues of $2.2 billion. Analysts expected
3038 cents a share with revenue at $2.1 billion, Net income increased by 18 percent (excluding Skype) from the same quarter in 2009, and revenue rose by 6 percent from last year.
Similar to last quarter, PayPal’s business seems to boost eBay’s results. According to eBay, PayPal delivered record second quarter performance and has been adding a million new accounts each month during the quarter. PayPal reported net income at $817 million, with total net payments volume coming in at $21.4 billion. The company generated $726.4 million of operating cash flow and $519.2 million of free cash flow during the quarter.
For three consecutive quarters, PayPal’s merchant services business has grown by over 40 percent year over year. Merchant services total payment volume equaled $13.1 billion for the quarter.The company also reported eBay’s marketplace saw strength in Europe, expected performance in Asia, and slower than expected growth in the U.S.
eBay CEO John Donohoe said in a release:
“We delivered strong second quarter results, demonstrating the global strength and increasing diversity of our business…PayPal is strong and getting stronger, building a robust and innovative global footprint serving all of ecommerce. And our eBay turnaround remains on track, with strong performance in Europe, significant changes in the U.S. and continued improvements to the buying and selling experience. We continue to focus on delivering strong financial results, managing a healthy balance sheet and making the necessary investments to compete, win and satisfy our customers.”
New and interesting tidbits from the conference call:
– PayPal now has 87 million active accounts
– Mobile is a big for eBay and PayPal, especially mobile payments. He highlights the launch of Mobile Express Checkout, which we recently covered here.
-eBay auction marketplace is also making a big push to mobile, eBay has seen 11 million downloads of its primary iPhone app.
– While U.S. sales are weaker, eBay is seeing strnger traffic from international markets.