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By Leena Rao

eBay (NASDAQ:EBAY) just reported first quarter earnings today posting revenue of $2.5 billion, an increase of 16% from the same period of 2010. eBay’s net income on a GAAP basis of $475.9 million, or $0.36 per diluted share, and non-GAAP net income of $619.0 million, or $0.47 per diluted share, representing a 12% increase compared to the same period of 2010. The retail giant narrowly beat analyst expectations, which were 46 cents per share on revenues of $2.48 billion. eBay says that the first quarter increase in earnings was due primarily to sales growth and a lower effective tax rate.

PayPal continued to help buoy eBay’s results, net total payment volume growing 28% to $27.4 billion in the first quarter of 2011 compared to the same period of last year, driven primarily by strong 38% year-over-year growth in its Merchant Services business across global markets, increased merchant adoption and greater usage by customers.

PayPal grew active registered accounts 16% year over year, ending the quarter with 97.7 million and adding approximately one million active accounts per month for the sixth consecutive quarter. eBay also reported that income increased from mobile payments and digital goods, with higher usage of Mobile Express Checkout, PayPal Send Money apps and the newly-launched PayPal for Digital Goods service.

eBay President and CEO John Donahoe said this in a statement: In the first quarter, PayPal continued to drive strong growth globally, eBay sharply accelerated growth in the U.S. and we announced several acquisitions that we believe will enhance our leadership and innovation in commerce and payments. The year is off to a strong start.

In terms of eBay’s Marketplace business, eBay’s merchandise volume grew at a slightly slower pace than PayPal. Gross merchandise volume excluding vehicles (GMV), increased by 8% year over year to $14.5 billion, GMV in the U.S. increased 10% year over year and international GMV increased 8% year over year, driven by continued strength in Europe and partially offset by weakness in Korea. eBay says the company is on track to double eBay’s mobile GMV to $4 billion in 2011. Worldwide, active users increased 5% year over year to 95.9 million, with growth in North America, the U.K., Germany and Australia.

For the second quarter of 2011, eBay expects net revenues in the range of $2.55 to $2.65billion with GAAP earnings per diluted share in the range of $0.36 to $0.37 and non-GAAP earnings per diluted share in the range of $0.45 to $0.46.

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