eBay Inc Reports On First Quarter Trading

eBay Inc. (Nasdaq: EBAY), a global commerce leader that connects millions of buyers and sellers around the world, today reported financial results for its first quarter ended March 31, 2020.

"During these unprecedented times, I am extremely proud of how our team has come together to support one another, our buyers and sellers, our communities and the business," said Scott Schenkel, eBay Inc. "As we look at Q1, I am pleased that we delivered on all of our commitments for the quarter, with key metrics such as Buyers, GMV and Revenue performing at or better than our expectations. Over the past several months, we have remained focused and clear-eyed about the strategic direction of the company and have driven substantial changes to position the business for sustainable and profitable long-term growth." 

"I appreciate the team's hard work in the first quarter and their efforts to maintain focus amid so many factors affecting the business and the industry," said Jamie Iannone, Chief Executive Officer of eBay Inc. "I'm thrilled to return to eBay this week as CEO and I look forward to building on the positive momentum in the business, continuing to evolve the Company's strategy and maximizing value for our shareholders."

COVID-19 Response and Business Impacts

• We believe our strong balance sheet, stable cash flows, low capital intensity and disciplined capital management approach gives us the strength and flexibility to adapt to this tough economic environment and to enable investment in our sellers and customers.
• As the COVID-19 pandemic continues, our priority is the safety and well-being of our employees, customers and communities. To that effect, we have taken immediate action to support our stakeholders.
• Nearly all global employees are working from home. In mainland China, Taiwan and Korea we are now managing a staggered return to the office.
• eBay Foundation has donated over $3.0 million in grants to nonprofits around the world, along with $500,000 in support to Silicon Valley Strong.
• Through eBay for Charity, we are matching up to $1.0 million in contributions made by U.S. customers who donate a portion of sales to Feeding America, Direct Relief and Opportunity Fund.
• In the U.K., we announced a partnership with the National Health Service (NHS), the Department for Health and Social Care and others to pilot a new platform to supply primary care and social care providers with access to personal protective equipment for free at the point of order from NHS Supply Chain.
• We have implemented measures designed to ensure our platform remains safe and trusted for buyers, removing or blocking over 15 million listings to date globally that make false health claims or offer products at inflated prices, in line with price gouging rules.
• We have offered to defer fees for hundreds of thousands of eBay sellers to support their cash flow needs, provided eBay Store subscribers with up to 100,000 extra listings for free and implemented additional protections for Seller Performance Standards.
• eBay has helped launch and grow hundreds of thousands of small businesses, and now we've created Up & Running to accelerate the start-up time frame for Main Street retailers opening online stores amid the pandemic.
• From the start of the quarter through mid-March our underlying business performance was better than our expectations.
• Since mid-March, our Marketplace platforms have experienced strength in key metrics - traffic, buyer acquisition, conversion, sold items and GMV - due to ongoing shelter-in-place dynamics in many countries. The Marketplace platforms have also experienced improved acquisition of small business sellers. This strength has continued into April.
• Our Classifieds platforms have been adversely impacted by recent auto dealer closures in many international markets, lower traffic to horizontal classifieds sites around the world due to social distancing requirements and lower advertising revenues. This pressure has continued into April.
• The impacts seen in both platforms to date could continue while shelter-in-place guidelines remain active, and it is difficult to predict what may result as shelter-in-place guidelines are eased and lifted and how global consumer demand and seller inventory may evolve over time.
• Our capital allocation strategy and key tenets and targets have not changed.

First Quarter Financial Highlights

• Revenue was $2.4 billion, down 2% on an as-reported basis and up 1% on a foreign exchange (FX) neutral basis.
• Active buyers grew by 2%, for a total of 174 million global active buyers.
• Gross merchandise volume (GMV) was $21.3 billion, down 1% on an as-reported basis and remaining flat on a FX-Neutral basis.
• Marketplace platforms delivered $2.1 billion of revenue, down 1% on an as-reported basis and up 1% on a FX-Neutral basis.
• Classifieds platforms delivered revenue of $248 million, down 3% on an as-reported basis and remaining flat on a FX-Neutral basis.

Business Highlights

• Following a comprehensive CEO search, on April 13, 2020, eBay announced that its Board of Directors appointed Jamie Iannone as Chief Executive Officer, effective April 27, 2020. Mr. Iannone was also appointed as a member of the Board, effective as of April 27, 2020.
• eBay's transition to managed payments continues to build momentum, processing over $3.0 billion of GMV for over 32,000 sellers. The service will be available in several new markets this July, including in the U.K., which was announced in February, and most recently announced in Canada and Australia.
• In Q1, Promoted Listings delivered $137 million of revenue, up 109% on an as-reported basis and up 111% on a FX-Neutral basis. Nearly 1.2 million sellers promoted more than 310 million listings in the quarter.
• Seller Initiated Offers scaled to over 1.5 million per day driven by increased adoption and item eligibility.
• Introduced a new feature, "Image Clean-Up," available in all markets, that uses computer vision technology to create a more consistent-looking buyer experience and is more effective in Google Shopping for both Android and iOS. Since launch, more than one third of sellers are using this new tool.
• eBay's Retail Revival program launched in Austin, Texas, with adaptations of the program, "Export Revival," also launching globally in Athens, Greece.
• eBay continues to explore potential value-creating alternatives for its Classifieds business, is holding active discussions with multiple parties, and anticipates having an update by the middle of the year.
• The company completed the sale of StubHub to viagogo on February 13, 2020, for $4.1 billion in proceeds, with net proceeds of $3.2 billion net of income taxes of $900 million, subject to working capital adjustments.

Source : eBay Inc

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