eBay Q3 Results, EU stablised, US goes South
Here in Europe the economy, at least according to eBay, has settled down and not causing undue concern according to Bob Swan, eBay CFO, who said “Europe and APAC has created a bit of anxiety for us in the first half of the year has stabilized through Q3 but at the same time, the U.S. e-commerce softened considerably and we have a cautious outlook for the holiday season“.
Other concerns which could impact earnings are the US dollar which has weakened since July and the Braintree purchase expected to close towards the end of the fourth quarter.
The US economy is of course in a right mess with the recent government shut down. At the 11th hour the US Senate leaders announced a deal to reopen government and narrowly avoided defaulting on their national debt. However the deal is only good until mid January so another shut down could be on the cards for the new year.
What could affect the UK is industrial action. Strikes, and not just the Royal Mail – teachers in many parts of the country are striking today, don’t just affect workers who participate and lose a day’s pay. They also affect everyone who has to pay for child care, take a day off work, or have to use alternative services at higher costs. They also have a knock on effect destroying any “feel good” factor that loosens the purse strings.
eBay maintaining their full year forecast, but are predicting that earnings will come in around the low end of their previous forecasts. eBay are predicting between $4.5 billion and $4.6 billion revenue for the fourth quarter with profits of 79 cents to 81 cents per share, investors were hoping for $4.64 billion revenue with earnings of 83 cents per share. How eBay performs all depends on how the US performs in the fourth quarter, the UK and Europe remaining stable and quite frankly if it’s a mediocre or bumper holiday season.
What does this mean for eBay sellers in the UK? Well it’s business as usual, generally we don’t care if eBay make money or not for their investors (although it’s pretty essential that they do), what we care about is are our products selling and are we as sellers making money?
There’s been a lot of discussion on whether recent site changes have affected sales and while some sellers are seeing stable growth many are complaining that sales have dried up. Have you noticed any differences in sales over the last few weeks and have you done the basics such as comparing your eBay traffic reports to previous periods and to your competitors? (If you’re not getting traffic the first thing to look at is why your listings are visible which could be as simple as updating titles and Item Specifics).
‘What does this mean for eBay sellers in the UK? Well it’s business as usual, generally we don’t care if eBay make money or not for their investors (although it’s pretty essential that they do), what we care about is are our products selling and are we as sellers making money?’
I suppose eBay make most of their money by taking fees, if their profit goes down then I suppose less people are buying on eBay?
Absolutely – and today more than ever before. So many of the fees are “Free to list, pay only when you sell” these days that eBay’s interests and seller’s interests are very firmly aligned so far as making money goes
I am Featured Shop on eBay where I get enough FREE BINs to cover my stock of one off collectables, but I used to create at least 25 auctions per week for which I paid.
Since the changes I have noticed that ALL my auctions go straight to the bottom of the category and only appear on the first page a couple of hours before the auction ends. Needless to say this has resulted in a massive drop in successful auctions.
I have reported this to eBay who agree it is a glitch (one that is not just affecting me by the way). It seems the new search looks for previous sales of an item and promotes accordingly. If you sell one offs, bespoke or collectable items there is of course no history, therefore down to the bottom you go.
In the meantime all the auctions I had scheduled, money in eBays pocket, I have now changed to free BINs. If a large number of other sellers do the same, then I am afraid I can see a drop in profits for eBay. Perhaps if this happens they might do something about Cassini and ensure it is working for everyone.