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eBay (ticker: EBAY) beat consensus estimates for revenue and EPS, and turned in a healthy year-over-year revenue growth rate of 36%. But eBay's growth is slowing. Details and quick comments:


Q1 Results
(all percentage changes and comparisons are year on year, unless stated otherwise)

  • Net revenues of $1.032 billion were up 36% and beat consensus of $1.03 billion.
  • Revenue breakdown: U.S. marketplace was $405 million, 39% of total, up 20%; international marketplace was $394 million, 38% of total, up 52%; payments revenue was $233 million, 23% of total, up 47%.
  • Gross profit was $845.4 million, gross margin 82%.
  • Operating expenses 46% of revs: sales and marketing 26%, product development 7%, G&A 13%.   
  • Operating Income was $336 million, 33% of net revenues, up 26%.
  • Pro forma operating income up 28% to $367 million, and was 36% of net revenues.
  • GAAP net income up 28% to $256.3 million, GAAP EPS of $0.19.
  • Pro forma net income up 31% to $275 million.
  • Pro forma EPS of $0.20 beat consensus of $0.18.
  • Operating cash flows were $495 million.
  • Free cash flows were $289 million, ie. operating cash flows less capex of $80 million and payment of a lease obligation of $126.4 million.

Key business metrics:

  • Confirmed registered users up 40% to 147 million.
  • Active users up 34% to 61 million.
  • New listings up 32% to 432 million.
  • Gross merchandise volume (GMV) up 32% to $10.6 billion.
  • PayPal accounts up 57% to 72 million.
  • 12 categories delivered $1 billion or more in worldwide annualized GMV: eBay Motors at $12.9 billion; Consumer Electronics at $3.4 billion; Computers at $3.2 billion; Clothing & Accessories at $3.1 billion;  Books/Movies/Music at $2.7 billion; Home & Garden at $2.2 billion; Collectibles at $2.2 billion; Sports at $1.9 billion; Toys at $1.7 billion; Jewelry & Watches at $1.6 billion; Business & Industrial at $1.4 billion; and  Cameras & Photo at $1.3 billion. 

Q2 Guidance

  • Net revenue of $1.025 billion  to $1.050 billion, versus consensus of $1.04 billion.
  • GAAP EPS of $0.16.
  • Pro forma EPS of $0.18.

Full Year 2005 Guidance

  • Net revenue $4.270 billion to $4.360 billion, versus consensus of $4.36.
  • GAAP EPS of $0.71 to $0.73.
  • Capex $340 million to $400 million, or 8-9% of total revenues.
  • Pro forma EPS of  $0.76 to $0.78.

Quick comments:

  • Compare eBay's 36% revenue growth to Yahoo's 44% organic revenue growth. Not so bad.
  • But revenue growth is slowing: last quarter's number was 43%. US growth fell from 24% to 19% and international growth from 64% to 51%.

EBAY chart below.
Ebay_4

Source: eBay beats numbers but growth is slowing (1Q05 earnings results)