The 10-second takeaway
For the quarter ended March 31 (Q1), eBay beat expectations on both revenue and earnings per share.
Compared to the prior-year quarter, revenue grew significantly and GAAP earnings per share grew significantly.
Margins dropped across the board.
eBay reported revenue of $3.28 billion. The 27 analysts polled by S&P Capital IQ expected a top line of $3.15 billion on the same basis. GAAP reported sales were 29% higher than the prior-year quarter's $2.55 billion.
Source: S&P Capital IQ. Quarterly periods. Dollar amounts in millions. Non-GAAP figures may vary to maintain comparability with estimates.
Non-GAAP EPS came in at $0.55. The 31 earnings estimates compiled by S&P Capital IQ forecast $0.52 per share on the same basis. GAAP EPS of $0.44 for Q1 were 22% higher than the prior-year quarter's $0.36 per share.
Source: S&P Capital IQ. Quarterly periods. Non-GAAP figures may vary to maintain comparability with estimates.
For the quarter, gross margin was 70%, 140 basis points worse than the prior-year quarter. Operating margin was 19.9%, 230 basis points worse than the prior-year quarter. Net margin was 17.4%, 130 basis points worse than the prior-year quarter.
Next quarter's average estimate for revenue is $3.36 billion. On the bottom line, the average EPS estimate is $0.54.
Next year's average estimate for revenue is $13.87 billion. The average EPS estimate is $2.29.
The stock has a four-star rating (out of five) at Motley Fool CAPS, with 3,581 members rating the stock outperform and 556 members rating it underperform. Among 1,183 CAPS All-Star picks (recommendations by the highest-ranked CAPS members), 1,095 give eBay a green thumbs-up, and 88 give it a red thumbs-down.
Of Wall Street recommendations tracked by S&P Capital IQ, the average opinion on eBay is outperform, with an average price target of $38.61.
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Seth Jayson had no position in any company mentioned here at the time of publication. You can view his stock holdings here. He is co-advisor of Motley Fool Hidden Gems, which provides new small-cap ideas every month, backed by a real-money portfolio. Motley Fool newsletter services have recommended buying shares of eBay. Motley Fool newsletter services have recommended writing puts on eBay. Try any of our Foolish newsletter services free for 30 days. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy.