eBay (EBAY +1.67%) stock has rallied by more than 30% this year, with trading card games and collectibles driving growth. Those catalysts remain intact, positioning eBay stock to outperform the S&P 500 once again in 2026.
However, the most exciting development may be eBay's pivot to livestreaming. The e-commerce platform has recently enabled live video, similar to YouTube and TikTok. eBay Live is more geared toward product reviews and tutorials than the broad topics found on social networks, but it could become a significant growth opportunity.
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GMV run rate is accelerating
eBay's companywide gross merchandise value (GMV) increased by 10.1% year-over-year and reached $20.1 billion in the third quarter. This indicates that more people are shopping on eBay more frequently, and a 9% revenue boost demonstrates the impact of increased GMV.
NASDAQ: EBAY
Key Data Points
While the entire business is performing well, eBay Live presents the biggest opportunity for shareholders at present. The GMV run rate for this segment more than quintupled in the third quarter as more creators turn to livestreaming to boost product sales.
eBay Live could lead to more engaging product presentations, ultimately increasing overall revenue. However, these additional videos may also keep people on eBay longer. Typically, keeping people on an e-commerce site for a longer period increases the likelihood that they will make a purchase. Some customers may binge videos on eBay, similarly to how they frequently watch YouTube and TikTok clips.
eBay is still in the early stages of livestreaming, but it presents a significant long-term opportunity for the growth stock.
Rising advertising revenue may receive another boost from eBay Live
eBay Live isn't just great for sellers, but keeping people on the site longer could be a massive tailwind for eBay's advertising segment. Online ads have become a significant contributor to overall revenue and profits. The company generated $525 million in Q3 from its ad network, representing a 21% year-over-year increase.
The eBay Live push could open up more opportunities for ad revenue, such as skippable five-second video ads and banner ads below the video. eBay ads also come with high margins, which could boost the company's overall profits.
Ads make up almost 20% of eBay's total revenue. That percentage should continue to rise as ad growth rates exceed overall revenue growth.
eBay's push into livestreaming and the continued success of online ads may be consequential tailwinds for the company. The stock trades at a price-to-earnings ratio of 18, and the company may deserve a higher valuation if these catalysts translate into accelerated revenue growth.
