On the Heels of eBay's Slide, What News Will Amazon's Earnings Bring?

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Last week, online seller Ebay (EBAY) released earnings for Q4 08 and the company posted its first revenue decline ever. It was even a double digit decline - by 16% to $ 1.3 bln. Next week we have another scheduled online seller's earnings call. Amazon (AMZN) releases results on Thursday 29th of January. And there could be upside surprise as the company called this the best Christmas ever with ordered 6.3 mln items. Also, in terms of internet searches, Amazon has beaten Ebay. December visitors increase by 9.8% y-o-y for Amazon vs. drop by 2.5% for Ebay.

The picture above is from Adam Hewison video analysis. You can see full analysis for Ebay share price here. There is still a not buy signal (shorts covering) with stocks plunging after disappointing quarter results.

Comments

[Bob C:]

Amazon is raising its napkin to wipe off the remains of eBay's holiday lunch.

Amazon, and the many alternate selling venues, will continue to eat eBay's lunch, breakfast, and dinner, starving the former giant to death in '09.

IMO

Jan 26 02:17 PM

[jenny:]

Amazon for the win. Consumer spending may be stabilizing, but EBAY already looks like there taking the brunt of this. There the top online retailer, they are doing something right and they just need to continue this into 09. Investors are feeling optimistic about AMZN (www.predictwallstreet....) and I think after estimates come out this will shoot up more.

Jan 26 02:55 PM

[Tony P.:]

Ebay's CEO John Donahoe not only reported that people didn't buy (anything!) for Christmas, he basically stated that those people didn't even L@@K for gifts.

Just ignore the totally contradictory data concerning Paypal's revenue growth from faltering ebay sales and (evidently) non-existant merchant web site sales. Paypal must have grown due to generous "contributions", in no way related to direct sales. uh huh

This week, Amazon will refute those statements for what they are - pure drivel. People did indeed look for gifts and many made purchases on Amazon and stand-alone web sites. Ebay? Not so much.

Dismiss us as Noise, disgruntled sellers or even as un-educated fools that can't comprehend a balance sheet. Go ahead, we're used to that. But come Friday, we'll be correct, once again.

Jan 26 03:08 PM

[eBay +++:]

Come on people, this is just eBay bashing as per ex-Seller usual. Amazon stills trailed eBay significantly for total traffic, sure they gained, but still have not caught eBay. eBay was the leader in Q4.

Don't count your Chickens before they hatch. Amazon has to continue this climb and that will not be easy as they had to give away the house in Q4 to see that increase. Their Margin is will be extremely poor in Q4. I can't see their profit gaining from Q3 to Q4, but we'll see. Remember eBay made 324+million in Q4 after GAAP. Let's see what Amazon makes.

I'm still comparing both sites in my shopping and Amazon hasn't had a better deal for me in a while.

Don't assume this % of traffic increase will continue.

Jan 26 06:57 PM

[eBay +++:]

Just to add, I received all of my Microsoft Live Cashback Money from my Holiday shopping on eBay. Got every dime I was expecting. Got as much as 30% cashback on a few items. What a great deal, too bad for those who didn't take advantage. All the items I bought were good deals without the cashback, then add between 20-30% cashback depending on the day I bought and there is no where on-line I could have done better.

I had good buyer experiences on all my items.

Jan 26 07:59 PM

[Wake-Up!:]

Well.... Once again..... eBay sacrifices it's core sellers in another poor attempt for a slice of Amazon. And STILL they trail in their dust. Was it worth it eBay? I'll bet not.

Keep your eye on www.Bonanzle.com. Members are signing up in droves. I am happily selling AND making money. No more paying eBay's outrageous fees!

In fact, 4 of my items which just sold a few minutes ago on www.Bonanzle.com cost me only $4.00 in Final Value Fees ($49.99 items each). That same deal would have cost me $35.78 in PayPal and Final Value Fees on eBay! Not including listing fees, store fees and zero protection for sellers.

Do the math: if I sold 16 of those same items, my www.Bonanzle.com fees would be $16.00. My eBay/PayPal fees would be $143.12!

Now www.Bonanzle.com may not have the traffic eBay or Amazon does - yet - but it's climbing the ladder at an astonishing rate and it's way more profitable - about 9 times more profitable!

What would you rather do? Sell 4 items on www.Bonanzle.com or sell 36 items on eBay to make the same profit! It makes sense to do less and make more. Of course!

So never mind the eBay Spin Doctors spewing their venom. They have to convince as many of you uneducated shareholders as possible, that eBay is simply having a hiccup.

Why? Because if they don't, they too will lose there arses when the stock turns into Charmin (they were the ones who thought "IT" was a deal at $30).

JMO :)

Jan 26 08:24 PM

[Bob C:]

eBay+++ states:
"Amazon has to continue this climb and that will not be easy as they had to give away the house in Q4 to see that increase."

Well here is what eBay did in Q4 to bolster its numbers;

They promoted a Holiday Giveaway, including ipods, high end clothes, and even a Chevy Corvette.
Guess what? The site was hacked. Most all of the winners had 0 (zero) feedback, most all were new sign-ups. The counters showed 0 (zero) visitors, even after the BIN purchase was made.
eBay insiders winning the goodies, or just very poor site security?
You decide.

Now, on to the Microsoft Live Cashback promo.
eBay was the only site offering up to 30% back, most were only 10%.
Guess who has to make up the difference? Microsoft?
I don't think so!! This payout will come from eBay's Q1 '09 profits.

Also on the cashback, many have bragged how they scammed the system on eBay.
A good example:
Two brothers worked together. One would put an "item" on eBay, with BIN & free shipping to qualify for the promo.
The other brother would "buy" it, and then they split the profit from cashback, doing this repeatedly until the cashback limit was reached, about 2k if I remember right.

Even after all of this 'promoting', their numbers were still down!!

Does this sound like a company that you would like to do business with!

Jan 26 10:08 PM

[eBay +++:]

Bob C that money came from Microsoft not eBay. I'm sure eBay paid for the click through as expected, but that was a Microsoft promotion for Live. The cash was theirs as they have very deep pockets. Any scams we're at Microsoft's expense not eBay's. Don't fault eBay for making it available to buyers.

Jan 26 11:07 PM

[Et tu, Brute!:]

"Last week, online seller Ebay (EBAY) released earnings for Q4 08 and the company posted its FIRST REVENUE DECLINE EVER. It was even a double digit decline - by 16% to $ 1.3 bln." [Caps added}

* * *

Nothing to add.

Jan 27 12:50 PM

[maybo975:]

Unfortunately, eBay no longer has a sustainable competitive advantage. It cannot compete with Amazon.com's solid infrastructure and excellent customer service from a fixed price strategy. On the auction side, eBay is losing market share to Craigslist.org and other "free" sites. Although eBay still has more traffic than Amazon.com overall, the trend is on the decline and unless eBay quickly finds its new niche, the company will continue its downward trend into the future...

Jan 27 12:58 PM

[Philip Cohen:]

If eBay did not have PayPal manning the bilge pumps, undoubtedly the good ship "eBay" would be even lower in the water. One has has to wonder if Captain Donahoe intends to stay on board and go down with the ship or will he, hopefully, soon hand over to a more competent officer and allow the ship to be towed back to port for urgently needed repairs? (The old classic Fonda/Cagney movie “Mr Roberts” comes to mind.)

Jan 27 02:58 PM

[Tony P.:]

"Amazon stills trailed eBay significantly for total traffic..."

Total traffic? Sorry dude, but that's not really relevant unless ebay erected a toll booth.

From the doors of the old Kmart you can see the traffic driving by, to the Walmart store down the road.

You follow?

Jan 27 03:56 PM

[dlweld:]

Seems to me that EBAy has given away the one thing that made their site a magnet - the cool and bizarre things that turned up for sale. That's what made EBAY unique and successful. My usual search used to turn up dozens of items of interest to me - almost nothing now, so little point visiting the site. So, having driven away the small sellers and thus given away their unique advantage over other e-commerce sites - given away the one thing that got the "eyeballs" - they're now trying to compete with all the established thin-margin e-commerce sites - good moves!

Jan 27 06:34 PM

[dlweld:]

Seems to me that EBAy has given away the one thing that made their site a magnet - the cool and bizarre things that turn up for sale. That's what made EBAY unique and successful. My usual search used to turn up dozens of items of interest to me - almost nothing now, so little point visiting the site. So, having driven away the small sellers and thus given away their unique advantage over other e-commerce sites - given away the one thing that got the "eyeballs" - they're now trying to compete with all the established thin-margin e-commerce sites - good moves!

Jan 27 06:35 PM

[musicman98:]

Wether, Amazon or the new Go Daddy effort, Ebay will never be what they once were, and they don't even try to hang on to what they have, which is what made ebay the grandaddy they are (or, were), "the unique sellers" remember? the one's who found a few items in thier attic to make a few bucks?, without them, (Not the Box sellers) the market of buyers or lookers will shrink and shrink, as did the Bell company, microsoft and so many others. I say Good RIDDANCE EBAY!!!

Jan 27 08:42 PM

[Tony P.:]

"On the Heels of eBay's Slide, What News Will Amazon's Earnings Bring?"

Amazon stock soars on strong profit and outlook

money.aol.com/news/art...


There's your answer. Those of us that sell, do so on many venues and we know where the sales take place. DUH.

Jan 29 06:33 PM