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eBay Inc. (EBAY - Free Report) reported fourth-quarter 2023 non-GAAP earnings of $1.07 per share, which beat the Zacks Consensus Estimate by 3.9%. The bottom line was flat year over year.
Net revenues of $2.6 billion surpassed the Zacks Consensus Estimate of $2.5 billion. The figure increased 2% from the year-ago quarter on a reported basis and 3% on an FX-neutral basis.
Strengthening momentum across advertising offerings of EBAY was a tailwind.
eBay’s first-party advertising products generated revenues of $368 million, up 33% on a reported basis and 30% on an FX-neutral basis from the prior-year quarter.
Total advertising offerings yielded $393 million in revenues, which grew 23.2% on a year-over-year basis.
However, the weakness in third-party advertising products, which generated $25 million in revenues in the reported quarter, was a negative. The figure moved down 42% year over year.
The weakening momentum among active buyers was concerning. EBAY witnessed a year-over-year decline of 2% in its active buyer base, which stood at 132 million at the end of the fourth quarter. The figure came in line with the consensus mark.
The active buyer count stood at 131 million, excluding contributions from GittiGidiyor and TCGplayer acquisitions.
EBAY’s total GMV of $18.6 billion in the reported quarter exhibited year-over-year growth of 2% on a reported basis and it was flat on a FX-neutral basis.
The reported GMV surpassed the Zacks Consensus Estimate of $18.09 billion.
The total GMV is categorized into two parts. U.S. GMV totaled $8.9 billion, accounting for 47.8% of the total GMV, down 0.03% from the year-ago quarter. International GMV was $9.7 billion, accounting for 52.2% of the total GMV. The same grew 4% on a year-over-year basis.
Operating Details
In the fourth quarter, eBay’s gross margin was 72.3%, which contracted by 60 basis points (bps) year over year.
Operating expenses of $1.4 billion rose 14.1% year over year. As a percentage of net revenues, the figure expanded 590 bps to 56.3% from the year-ago quarter.
The non-GAAP operating margin was 26.7% in the fourth quarter, contracting 320 bps year over year.
Balance Sheet & Cash Flow
As of Dec 31, 2023, cash equivalents and short-term investments were $4.5 billion, down from $4.7 billion as of Sep 30, 2023.
Long-term debt was $6.973 billion at the end of the fourth quarter, which was flat with the prior quarter.
EBAY generated $123 million in cash from operating activities in the fourth quarter, significantly down from $862 million in the third quarter.
The company’s free cash flow was an outflow of $3 million in the reported quarter.
eBay repurchased $250 million worth of shares and paid out dividends of $129 million in the reported quarter.
Guidance
For first-quarter 2024, eBay expects revenues of $2.50-$2.54 billion. On an FX-neutral basis, revenue growth is anticipated in the band of 0%-2%. On a spot-rate basis, the same is expected between 0% and 1%. The Zacks Consensus Estimate for revenues is pegged at $2.56 billion.
The non-GAAP operating margin for first-quarter 2024 is expected between 29.6% and 30%.
GMV for the first quarter is likely to be $18.2-$18.5 billion.
Non-GAAP earnings per share are anticipated between $1.19 and $1.23. The Zacks Consensus Estimate for the same is pegged at $1.13.
Image: Bigstock
eBay (EBAY) Q4 Earnings Surpass Estimates, Revenues Rise Y/Y
eBay Inc. (EBAY - Free Report) reported fourth-quarter 2023 non-GAAP earnings of $1.07 per share, which beat the Zacks Consensus Estimate by 3.9%. The bottom line was flat year over year.
Net revenues of $2.6 billion surpassed the Zacks Consensus Estimate of $2.5 billion. The figure increased 2% from the year-ago quarter on a reported basis and 3% on an FX-neutral basis.
Strengthening momentum across advertising offerings of EBAY was a tailwind.
eBay’s first-party advertising products generated revenues of $368 million, up 33% on a reported basis and 30% on an FX-neutral basis from the prior-year quarter.
Total advertising offerings yielded $393 million in revenues, which grew 23.2% on a year-over-year basis.
However, the weakness in third-party advertising products, which generated $25 million in revenues in the reported quarter, was a negative. The figure moved down 42% year over year.
The weakening momentum among active buyers was concerning. EBAY witnessed a year-over-year decline of 2% in its active buyer base, which stood at 132 million at the end of the fourth quarter. The figure came in line with the consensus mark.
The active buyer count stood at 131 million, excluding contributions from GittiGidiyor and TCGplayer acquisitions.
Nevertheless, growing gross merchandise volume (GMV) contributed well.
eBay Inc. Price, Consensus and EPS Surprise
eBay Inc. price-consensus-eps-surprise-chart | eBay Inc. Quote
GMV Details
EBAY’s total GMV of $18.6 billion in the reported quarter exhibited year-over-year growth of 2% on a reported basis and it was flat on a FX-neutral basis.
The reported GMV surpassed the Zacks Consensus Estimate of $18.09 billion.
The total GMV is categorized into two parts. U.S. GMV totaled $8.9 billion, accounting for 47.8% of the total GMV, down 0.03% from the year-ago quarter. International GMV was $9.7 billion, accounting for 52.2% of the total GMV. The same grew 4% on a year-over-year basis.
Operating Details
In the fourth quarter, eBay’s gross margin was 72.3%, which contracted by 60 basis points (bps) year over year.
Operating expenses of $1.4 billion rose 14.1% year over year. As a percentage of net revenues, the figure expanded 590 bps to 56.3% from the year-ago quarter.
The non-GAAP operating margin was 26.7% in the fourth quarter, contracting 320 bps year over year.
Balance Sheet & Cash Flow
As of Dec 31, 2023, cash equivalents and short-term investments were $4.5 billion, down from $4.7 billion as of Sep 30, 2023.
Long-term debt was $6.973 billion at the end of the fourth quarter, which was flat with the prior quarter.
EBAY generated $123 million in cash from operating activities in the fourth quarter, significantly down from $862 million in the third quarter.
The company’s free cash flow was an outflow of $3 million in the reported quarter.
eBay repurchased $250 million worth of shares and paid out dividends of $129 million in the reported quarter.
Guidance
For first-quarter 2024, eBay expects revenues of $2.50-$2.54 billion. On an FX-neutral basis, revenue growth is anticipated in the band of 0%-2%. On a spot-rate basis, the same is expected between 0% and 1%. The Zacks Consensus Estimate for revenues is pegged at $2.56 billion.
The non-GAAP operating margin for first-quarter 2024 is expected between 29.6% and 30%.
GMV for the first quarter is likely to be $18.2-$18.5 billion.
Non-GAAP earnings per share are anticipated between $1.19 and $1.23. The Zacks Consensus Estimate for the same is pegged at $1.13.
Zacks Rank & Stocks to Consider
Currently, eBay carries a Zacks Rank #3 (Hold).
Some better-ranked stocks in the broader sector are NVIDIA (NVDA - Free Report) , BILL Holdings (BILL - Free Report) and CrowdStrike (CRWD - Free Report) , each sporting a Zacks Rank #1 (Strong Buy) at present. You can see the complete list of today’s Zacks #1 Rank stocks here.
NVIDIA shares have returned 59% year to date. The long-term earnings growth rate for NVDA is projected to be 29.73%.
Shares of BILL Holdings have lost 20.9% in the year-to-date period. BILL’s long-term earnings growth rate is expected to be 23.64%.
Shares of CrowdStrike have gained 25.8% in the year-to-date period. The long-term earnings growth rate for CRWD is anticipated to be 36.07%.