eBay profits hit USD730 million, boosted by PayPal and Marketplaces

Profits hit USD730 million

eBay’s PayPal and Marketplaces businesses helped the firm to double-digit growth during its latest quarter, with net income up 16% year on year to hit USD730 million. Revenues for the firm’s fiscal Q3, ending June 30, grew 23% year on year, coming in at USD3.4 billion. eBay says that Marketplace recorded its strongest growth since 2006, while continuing merchant and consumer adoption of its PayPal service drove the division’s revenues to 23% year-on-year growth. PayPal now boasts 113.2 million registered users worldwide and the service processed a total payment volume of USD34.5 billion during the quarter, a 20% increase compared to the same period last year. eBay is reaping the benefits of focusing on its mobile properties, and the firm says that both eBay’s and PayPal’s mobile properties are on track to process USD10bn in transactions this year, more than double 2011’s total.

While eBay continues to bank on PayPal to help drive its recent resurgence, the performance of Marketplace, which includes its core online auction service, will provide a boost going forward. “The results were very good. I don’t think anybody in their wildest dreams thought Marketplaces would be growing this fast,” Wedbush Securities analyst, Gil Luria, tells Reuters.

eBay CEO John Donahoe says that mobile “continues to be a game changer”, driven by “a staggering surge in mobile shopping and payments on devices that did not exist just a few years ago”. Mobile is a key focus for eBay as it continues its turnaround. The company’s UK ad head, Phuong Nguyen, told StrategyEye earlier this month that eBay “hasn’t truly unlocked the full potential of mobile devices and the interplay between all these different channels” but adds that “the smartphone is the one key part of the puzzle that has finally unlocked a true multi-channel experience”.

eBay by the numbers
¤ Profits grew 16% year on year to hit USD730 million.
¤ Revenue climbed 23% year on year to hit USD3.4billion.
¤ PayPal now boasts 113.2 million registered users.
¤ eBay and PayPal’s mobile properties on course to transact USD10 billion this year.

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