eBay Q2 Revenues Exceed Expectations

• Revenue of $2.6 billion, up 1% on an as-reported basis and up 2% on an FX-Neutral basis
• Gross Merchandise Volume of $18.4 billion, up 1% on an as-reported and FX-Neutral basis
• GAAP and Non-GAAP earnings per diluted share of $0.45 and $1.18, respectively
• GAAP and Non-GAAP operating margin of 21.3% and 27.9%, respectively
• Returned $1.1 billion to stockholders in Q2, including $1.0 billion of share repurchases and $135 million paid in cash dividends

eBay Inc. (Nasdaq: EBAY), a global commerce leader that connects millions of buyers and sellers around the world, today reported financial results for its second quarter ended June 30, 2024.

"eBay's strong Q2 results mark another step toward achieving sustainable, long-term growth," said Jamie Iannone, Chief Executive Officer at eBay. "The continued momentum in Focus Categories contributed to our increase in GMV, while new AI capabilities are driving innovation across the platform and transforming the experience for eBay customers around the world."

"Q2 was another strong quarter for eBay as we exceeded expectations across our key financial metrics," said Steve Priest, Chief Financial Officer at eBay. "We achieved positive year-over-year GMV growth, driven by our execution against strategic initiatives, despite an uneven discretionary demand environment in our major markets."

Second Quarter Financial Highlights

• Revenue was $2.6 billion, up 1% on an as-reported basis and up 2% on a foreign exchange (FX) neutral basis.
• Gross Merchandise Volume (GMV) was $18.4 billion, up 1% on an as-reported and FX-Neutral basis.
• GAAP net income from continuing operations was $226 million, or $0.45 per diluted share.
• Non-GAAP net income from continuing operations was $602 million, or $1.18 per diluted share.
• GAAP and Non-GAAP operating margin was 21.3% and 27.9%, respectively.
• Generated $367 million of operating cash flow and $278 million of free cash flow.
• We completed the previously announced sale of Adevinta shares in exchange for $2.4 billion in cash and shares of a newly privatized entity, Aurelia, which are valued at $1.9 billion at the closing of the transactions.
• Returned $1.1 billion to stockholders, including $1.0 billion of share repurchases and $135 million paid in cash dividends.

Business Highlights

• eBay closed a series of transactions with Collectors, including the acquisition of Goldin from Collectors, the sale of the eBay vault, and a commercial agreement for more streamlined grading, storage and selling experiences.
• eBay enabled Venmo as an additional payment method during the quarter. Known for its popularity among Gen Z and Millennials, Venmo gives eBay buyers in the U.S. even more choice and flexibility during the checkout experience.
• The company expanded its eBay Refurbished program to include refurbished golf clubs, bringing warranties and hassle-free returns to thousands of previously owned clubs from the world's top brands.
• In June, the company announced a sustainability collaboration with Seagate, a global leader in data storage solutions. Seagate's official storefront on eBay now offers direct sales of factory recertified hard drives, which can eliminate a significant amount of e-waste by extending the lifecycles of these products.
• The company launched a number of innovative product features to simplify and enhance the buying and selling experience for customers. In the U.S. and U.K., eBay introduced Shop the look, a generative-AI powered discovery feature for fashion buyers. The company also launched its AI-powered background enhancement tool to 100% of iOS and Android users in the U.S., U.K. and Germany, enabling even more sellers to apply a variety of backgrounds to their listing images.
• The company introduced improved selling and buying experiences for pre-owned apparel in the U.K. For sellers, these changes included a new selling flow that makes it considerably easier to list on eBay, with image guidance, simpler item aspect collection, and a streamlined shipping module. For buyers, we introduced new Generative AI-powered features, like Shop the look and Explore, which offer more inspirational shopping experiences for fashion enthusiasts.
• eBay and Certilogo launched a new 'click-to-resell' feature, making it easier for sellers to list pre-owned clothing on eBay and verify authenticity through Certilogo's AI-based system. Italian outerwear brand Save The Duck is the first to pilot the new feature.
• eBay's consignment service expanded in the U.S. to include luxury watches, footwear and fine jewelry. In partnership with Linda's Stuff, this service gives casual sellers the opportunity to leverage experts to list and sell luxury items on their behalf.
• The company partnered with Condé Nast to spotlight pre-loved apparel at some of fashion's biggest moments like the Met Gala and Vogue World in Paris.
• eBay became an Official Partner of the McLaren Formula 1 Team, enabling both brands to reach new audiences through unique storytelling opportunities with their respective fans and customers. As part of the multi-year collaboration, eBay branding is being featured on the race cars of drivers Lando Norris and Oscar Piastri for four races across the 2024 season: the Miami, British, United States and Las Vegas Grands Prix.

Impact

• In May, eBay released its 2023 Impact Report showcasing how the company has leveraged its global marketplace to create economic opportunities, promote sustainable commerce, and foster a diverse and inclusive workforce.
• eBay also published its latest Recommerce Report highlighting the many benefits of shopping pre-loved items.
• eBay launched "Rocket Man Resale," a partnership with Elton John, who released a personal collection of pre-loved fashion items exclusively on eBay through auctions and fixed-priced listings. The partnership included a pop-up shop in the West Village of New York City. All proceeds benefited the Elton John AIDS Foundation.
• During the quarter, eBay Foundation granted nearly $7 million to strategic nonprofit partners across the U.S., which are addressing and removing barriers to entrepreneurship for people who identify with historically excluded groups.
• eBay for Charity contributed more than $47 million globally in Q2, up 22% year-over-year.

Second Quarter 2024 Financial Highlights (presented in millions, except per share data and percentages)

Other Selected Financial and Operational Results

• Operating margin – GAAP operating margin increased to 21.3% for the second quarter of 2024, compared to 20.4% for the same period last year. Non-GAAP operating margin increased to 27.9% for the second quarter of 2024, compared to 26.9% for the same period last year.
• Taxes – The GAAP effective tax rate for continuing operations for the second quarter of 2024 was 31.1%, compared to 39.7% for the second quarter of 2023. The non-GAAP effective tax rate for continuing operations for the second quarter of 2024 was 16.5%(1).
• Cash flow – The company generated $367 million of operating cash flow and $278 million of free cash flow during the second quarter of 2024.
• Capital returns – The company repurchased $1.0 billion of its common stock, or approximately 19 million shares, in the second quarter of 2024. The company's total repurchase authorization remaining as of June 30, 2024 was approximately $1.9 billion. The company also paid cash dividends of $135 million during the second quarter of 2024.
• Cash and cash equivalents and non-equity investments – The company's cash and cash equivalents and non-equity investments portfolio totaled $6.3 billion as of June 30, 2024.

Business Outlook

eBay is providing the following guidance for the third quarter 2024.

Dividend Declaration

• eBay's Board of Directors has declared a cash dividend of $0.27 per share of the company's common stock. The dividend is payable on September 13, 2024 to stockholders of record as of August 30, 2024.

Source : eBay, Inc

For all the very latest news and intelligence on the largest UK home improvement and garden retailers, sign up for the Insight DIY newsletter.