We know that eBay was one of the best e-commerce marketplaces right at a time when Amazon was slowly making its mark in the industry and no other marketplace was available to compete with it. However, eBay’s own issues as well as Amazon’s brilliant marketing lead to what we see now as the best marketplace in the world right now which is Amazon. Despite that, eBay is still doing numbers thanks to its business in the US and other parts of the world excluding India where it has shut shop.
eBay CEO Iannone said, “We’ve observed softening consumer trends to date in Q4 and particular challenges in Europe, suggesting we may see a more muted seasonal uptick over the holidays”. Another analyst adds that “eBay’s results are consistent with other companies we have seen in e-commerce, including Amazon and Etsy, which reflect a very challenging environment for discretionary spending”. Reportedly, eBay forecast current-quarter revenue in the range of $2.47 billion to $2.53 billion, compared with estimates of $2.60 billion. The company also expects current-quarter adjusted profit per share in the range of $1 to $1.05, compared with estimates of $1.04. Third-quarter revenue rose 5% to $2.50 billion, in line with Wall Street expectations, as the company saw an uptick in demand for refurbished goods. It is revealed that eBay earned $1.03 per share compared to estimates of $1.
The report reveals that “Analysts at Jefferies said earlier this month that web traffic on eBay continues to decline, with data showing a worsening trend through July to October this year.” It is also mentioned that “Rising competition from the likes of Amazon, that sells a lot of consumer staples, has amplified eBay’s woes.” To add to that, “High-interest rates and stubborn inflation across major economies in Europe as well as in the United States have further eaten into consumers’ discretionary budgets.” One reason why eBay, or any other company for that matter, forecasts lower-than-expected revenue is so that its share price does not fall drastically when it posts the results in that quarter. On the other hand, if the business rises and posts higher-than-expected numbers, then the company’s share price increases, and they make a profit on it.
