Online platform eBay has beat analysts’ earnings expectations in its quarterly report for the second quarter of 2022. According to the board, the e-commerce company’s focus on higher-priced products and the sneaker product category mitigated the impact of spending restraint and weakness in some European markets. eBay forecast revenue between $2.29 billion and $2.37 billion for the current quarter. Full-year revenue estimates were maintained at $9.6 billion to $9.9 billion.
Second Quarter Financial Highlights:
- Revenue was $2.4 billion, down on an as-reported basis and down 6 percent on a foreign exchange-neutral basis.
- Gross merchandise volume (GMV) was $18.5 billion, down 18 percent on an as-reported basis and down 14 percent on an FX-neutral basis.
- GAAP net loss from continuing operations was $536 million, or $(0.96) per diluted share, primarily driven by the change in fair value of eBay’s equity investments.
- Non-GAAP net income from continuing operations was $554 million, or $0.99 per diluted share.
- GAAP and Non-GAAP operating margins of 21.7 percent and 28.7 percent, respectively.
- eBay generated $577 million in operating cash flow and $466 million in free cash flow from continuing operations.
However, the company lowered its full-year forecast for gross merchandise value (GMV) to between $72.7 billion and $74.7 billion, down from $73.2 billion to $75.2 billion previously. GMV, a key industry indicator, is the total value of goods sold in the marketplace.
In a press conference call following the Q2 release, eBay CFO Stephen Priest said: “There are three significant considerations that we’ve taken into account and expect to continue throughout the rest of 2022. The first being the impact of the war in Ukraine, which has a disproportionate impact on the European business because of the proximity to Ukraine and the pressure on energy prices. Secondly, the supply chain constraints, which are having an impact on our cross-border trade. And again, we expect those to prevail through the rest of the year. And then thirdly, just really thinking about the broader macro backdrop where we’re seeing elevated inflation, rising interest rates, which are having associated impacts on consumer discretionary spend that are all putting pressure.”
