An Analysis of eBay's Q1 Results

| About: eBay Inc. (EBAY)

Wednesday evening, eBay (NASDAQ:EBAY) announced Q1 2010 results. This post focuses in on the marketplace side of the business. You may want to review our same-store-sale data for Q1 here.

GMV - the pulse of the marketplace.

eBay provides a myriad of data points for the marketplace business, but we always counsel folks to look at the primary datapoint - GMV (Gross Merchandise Value). Registered users, items sold, segment revenue, etc. Those are all useful secondary metrics, but they don't shine as much light on the business as GMV does.

For the earnings call, eBay provided this handy chart with the GMV metrics: (click to enlarge)

Ebay_q1_2010_gmv

eBay's overall GMV was $15.4b for the Q, but to get a true apples to apples for GMV, you have to pull out three pieces:

  • Autos - a drag on eBay's GMV growth and the economics are very different (more like a classifieds site) so they aren't applicable.
  • Gmarket - eBay acquired gmarket and the gmarket is inorganically in Q110, but not in Q109.
  • Currency (FX) - The GBP and Euro are fluctuating a good bit and their impact need to be taken out to compare year over year trends.

The following numbers are all ex-autos, ex-gmarket and ex-FX.

Ebay_q1_2010_gmv_growth

While domestic showed some good trends, the decrease in International is concerning. In the key eBay International markets, eBay is a year into the same fee changes they are rolled out in the US on 3/31/10. If those changes are already 'tapped out', that could indicate problems for the domestic side in the near future. The International deceleration caused the overall number to come in flat Q/Q.

But what about Amazon and e-commerce?

Taken in a vacuum, eBay's results are decent. But their stated goal is to grow with e-commerce. . Comscore came out with data this week that indicates they saw March come in (ex travel) at 19% y/y and they pegged Q1 at 11% y/y. So at 8% overall, eBay lags that growth rate by 3% and the comscore data is US, so the comp is 6% vs. 11% - or a 5% delta. So eBay isn't out of the woods yet and needs to continue to work on growth strategies.

Amazon (NASDAQ:AMZN) announces Thursday and we'll have coverage on Amazon Strategies - our SSS data indicates there is no slow down there and we suspect sales will be up > 30% again for Q1.

Disclosure - I am long Google and Amazon. eBay is an investor in ChannelAdvisor.