This summary is based on the fourth quarter fiscal 2007 earnings call conducted by eBay Inc. (EBAY) on January 22, 2008.
Management:
President and Chief Executive Officer: Meg Whitman
Chief Financial Officer: Bob Swan
Vice President of Investor Relations: Mark Rowen
Future CEO: John Donahoe
Key Investors Issues
- EPS were 39 cents a share compared to 25 cents a share last year.
- Net income was $530.9 million compared to earnings of $346.5 million for the same quarter the previous year.
- Revenue grew nearly 27% to $2.18 billion.
Fourth Quarter Highlights
Driven by another successful online holiday shopping season for eBay and PayPal, the company generated net revenue of $2.2 billion, a 27% increase over last year.
The company generated operating income of $755 million, a 31% year-over-year increase and EPS for the quarter was 45 cents per share, representing a 45% increase over last year.
Revenue for Marketplaces business unit was $1.5 billion, up 21% from the fourth quarter of 2006.
- Based on unique visits, eBay was again the number one ecommerce site in the US, Germany and the UK according to Nielsen NetRatings. Nearly 80 million shoppers came to eBay to make their holiday purchases.
- eBay around the world drove more than $16 billion of GMV and saw record volumes of traffic, number of listings and velocity of trade.
PayPal business represents nearly 8% of all global online transactions and is the ecommerce leader in payments.
- For the first time since PayPal was acquired by eBay in 2002, PayPal has delivered three consecutive quarters of accelerating revenue growth.
- Remarkable merchant services business continues to grow rapidly, attracting thousands of new customers and merchants each and every week.
On the communications side, Skype had a strong quarter, delivering a total of $115 million in revenue up 76% year over year.
The company reached a total of 276 million Skype users, while SkypeOut minutes also increased to 1.6 billion. Among the successes, the Skype phone launched with Skype’s partner Three continues to sell briskly in the UK, Italy and Australia. Recent deal with MySpace has already helped bring millions of new users to Skype.
- The company purchased more then $300 million worth of eBay shares.
Combined businesses generated net revenues of $2.2 billion, a 27% increase over last year.
- This was a milestone quarter as the company achieved $2 billion in quarterly revenue for the first time ever.
- Organic revenue growth, excluding acquisitions and foreign exchange, was 18%.
- Growth was turbo-charged by PayPal and its merchant services business and by some of non GMV businesses such as Shopping.com, advertising and classifieds where it continues to gain traction.
- Non-GAAP EPS was 45 cents per share, a 45% increase from last year and 4 cents per share above the high end of guidance range. The EPS growth was primarily driven by strong operational performance across most of businesses. In addition, the company benefited from a weaker US dollar, a lower tax rate and a reduced share count when compared to last year.
- Operating margins came in at 34.6%, 120 basis points higher than last year.
- The company generated $665 million of free cash flow, an increase of 26% above last year’s level, primarily driven by earnings expansion.
Marketplaces business segment achieved net revenues of $1.5 billion, an increase of 21% over a year ago.
Global GMV was $16.2 billion, a 12% increase.
- eBay has 83 million active users at the end of December, up 7% over last year excluding China and Taiwan.
- New listings of 637 million representing growth of 4% versus 2006 and marking the first time in three quarters that listings have increased on a year-over-year basis.
