eBay

Sector: E-commerce Countries of operation: Australia, Germany, UK, and US and 176 other countries Key product categories: Accessories and apparel, automotive, and consumer electronics Annual Metrics [caption id="attachment_136243" align="aligncenter" width="700"] Fiscal year ends December 31
*Trailing 12 months ended September 30, 2021[/caption]   Summary Founded in 1995 and headquartered in San Jose, California, eBay Inc. operates popular e-commence marketplace platform eBay. eBay connects buyers and sellers worldwide via its website and via mobile app. eBay previously operated online ticket platform StubHub, which was sold to Viagogo in February 2020, as well as eBay Classifieds, which was sold to online classifieds platform Adevinta in July 2021. eBay has 154 million global annual active buyers as of September 30, 2021, representing a 5% year-over-year decline. Company Analysis Coresight Research insight: As its success is dependent on its userbase, eBay is continuously looking to build trust among both buyers and sellers. The company’s recent initiatives in this area include its Certified Refurbished program, which it launched in October 2020 in partnership with globally recognized brands, including De’Longhi and Fila. The program provides consumers a guarantee that products have been refurbished and inspected by the manufacturers, enabling consumers to access pre-loved branded goods for a reasonable price. This builds on existing measures to improve the buyer experience, including the company’s eBay Authenticate service and the eBay Money Back Guarantee, which protects shoppers’ interests. From a seller perspective, eBay regularly evaluates its pricing to ensure that its listings remain competitive against market alternatives. It offers premium features such as the Promoted Listing program to improve listing visibility, as well as incentivizing the top-rated on the platform to maintain excellent customer service. The combined measures aim to make users more comfortable with buying and selling on eBay. In its third quarter, ended September 30, 2021, eBay reported revenues of $2.5 billion, rising 11% year over year. However, its GMV decreased by 8% to reach $19.5 billion, declining from $21.7 billion in the same period last year. In its last quarter of 2021, the company expects that revenues will be driven by the ongoing execution of its advertising, business and managed payments initiatives. It also expects an increase in non-GAAP EPS, led by a strong performance in managed payments and a lower share count—but offset by volume deleveraging.

Tailwinds

Headwinds

Consumers’ increasing acceptance of online shopping due to the pandemic, which will likely remain after the pandemic subsides Competition from other strong players, such as Walmart and Amazon, threatens its popularity Focus on cultivating trust among consumers Offering the Authenticity Guarantee across multiple categories Potential growth in the refurbished goods market

Declining active buyers may adversely impact business performance Competition from other strong players, such as Walmart, which is expected to beat eBay to become the second-biggest online US seller with a 5% share of the market, outpacing eBay’s 4%, according to financial services company Morgan Stanley Difficulty in maintaining quality control among third-party sellers Increased freight and labor costs over the past few years

  Strategy: In October 2020, eBay outlined four key areas to achieve long-term growth, which we detail below: 1. Focus on connecting buyers and sellers

• Simplify the processes for users to list, buy and sell items
• Continue to invest in initiatives to improve customer experience, such as its Authenticity Guarantee service

2. Develop new technologies

• Invest significant resources in technology
• Use artificial intelligence (AI), computer vision, natural language processing, machine translation and other technologies to create inspiring e-commerce experiences

3. Target the used and refurbished market

• Continue to evolve the refurbished experience for buyers and sellers, including adding new categories and expanding brand partnerships in Certified Refurbished
• Upgrade and expand authentication services

4. Continue to scale the management of payments

• Expand the management of payments to more countries

Revenue Breakdown (2020)   Company Developments

Date	Development
September 9, 2021	eBay announces that it has entered a strategic partnership and invested in online truck and heavy equipment marketplace Bidadoo, aiming to transform the heavy equipment sector.
July 14, 2021	eBay announces that it has entered into an agreement with private equity firm Permira to sell approximately 125 million shares of its stake in Adevinta for an estimated total consideration of $2.25 billion.
June 25, 2021	eBay completes the sale of its Classifieds business to Adevinta in exchange for $2.5 billion in cash and a 44% equity stake in Adevinta, equivalent to approximately 540 million shares.
June 24, 2021	eBay and South Korea-based discount store chain Emart announce that Emart will purchase eBay’s Korea business.
March 3, 2021	eBay starts managing payments on its marketplace in France, Italy and Spain to strengthen the customer experience.
January 19, 2021	eBay begins an undisclosed process to explore, review and evaluate a series of strategic options for its Korean business.
November 23, 2020	eBay launches “Up & Running Grants” to help small businesses affected by Covid-19.
November 19, 2020	eBay and Optoro, a technology company that offers complete returns solutions, announce an exclusive partnership to streamline resale of returned and excess inventory.
October 12, 2020	eBay expands its Authenticity Guarantee service to collectible sneakers over $100 in the US.
October 9, 2020	eBay partners with Google Assistant to launch voice control capability on eBay’s android app.
September 10, 2020	eBay announces the appointment of Carol Hayles and Mohak Shroff to its Board of Directors.
September 8, 2020	eBay launches the Authenticity Guarantee service for all watches over $2,000 in the US.
September 2, 2020	eBay and UPS announce a new collaboration to expand shipping options on eBay’s global marketplace.
July 21, 2020	eBay enters into a definitive agreement to transfer its Classifieds business to Adevinta for a total consideration valued at approximately $9.2 billion.
April 13, 2020	eBay names Jamie Iannone Chief Executive Officer.
February 13, 2020	eBay completes the sale of StubHub to Viagogo for $4.05 billion in cash.
December 4, 2018	eBay announces the expansion of the eBay Authenticate program into the luxury jewelry category, offering holiday shoppers more than 45,000 high-end gemstone jewelry items, including diamonds, that have been verified by professional authenticators.
November 27, 2018	Kijiji, a brand under eBay Classifieds Group, and AutoCanada Inc. announce that Kijiji will be AutoCanada’s preferred online marketplace partner in Canada, giving AutoCanada dealers access to Kijiji’s large and growing audience.
October 22, 2018	eBay announces the launch of eBay Instant Selling, which allows consumers to sell smartphones and get paid instantly with an eBay voucher, without having to manage the selling process.
October 11, 2018	Kijiji, a brand under eBay Classifieds Group, announces the launch of Kijiji Autos, an auto selling platform in Canada for new and used cars and trucks from both dealers and private sellers.
September 28, 2018	eBay launches Catch, a new shopping platform in Germany that specifically targets value-oriented millennials. The platform is designed to provide a fun and inspiring shopping experience by offering trendy and unusual products.

  Management Team

• Jamie Iannone—CEO, President, and Director
• Stephen J. Priest—Senior VP and Chief Financial Officer
• Brian J. Doerger—VP and Chief Accounting Officer
• Joe Billante—Vice President of Investor Relations
• Mazen Al-Rawashdeh—Senior Vice President and Chief Technology Officer

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Source: Company reports/S&P Capital IQ