The e-commerce behemoth eBay Inc (EBAY) came out with Q2 results after the closing bell on July 16. Though the company fell short of the Zacks Consensus Estimate on top line, investors should see some hope in the strong earnings outlook.
Adjusted earnings per share came in at $0.69 per share, better than the year-ago level of $0.63. Revenues of $4.37 billion also fell shy of the estimate of $4.38 billion but grew 13% year over year. Revenues were primarily volume-driven.
eBay's Pay Pal business put up a good show in the quarter with a 15% gain in active registered accounts. Another segment – Marketplaces – generating revenues from the sale of goods available on eBay properties – witnessed a 14% surge in new buyers. Net revenues from payments surged 20%.
However, on the margin front, the e-commerce giant clearly dragged. The pro forma gross margin fell 63 bps year over year. The take rate too was down annually.
Mixed Guidance
While the story so far was mixed, the company maintained the same tone on the guidance front. The company guided non-GAAP earnings in the range of $0.65 to $0.67 per share, which is way above the Zacks Consensus Estimate of $0.60.
However, management expects third-quarter 2014 revenues of $4.30–$4.40 billion which is below the consensus expectation of $4.42 billion. The company maintained its earnings guidance for 2014 though it reduced the upper limit of the revenue guidance.
Market Impact
As expected, thanks to a mixed report, eBay shares did not rise following the release, but did not fall either. This gives a cue that investors might be taking interest in ...
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