The 10-second takeaway
For the quarter ended June 30 (Q2), eBay met expectations on revenues and met expectations on earnings per share.
Compared to the prior-year quarter, revenue grew. Non-GAAP earnings per share grew. GAAP earnings per share dropped.
Margins dropped across the board.
eBay logged revenue of $3.88 billion. The 36 analysts polled by S&P Capital IQ anticipated sales of $3.89 billion on the same basis. GAAP reported sales were 14% higher than the prior-year quarter's $3.40 billion.
EPS came in at $0.63. The 36 earnings estimates compiled by S&P Capital IQ forecast $0.63 per share. Non-GAAP EPS of $0.63 for Q2 were 13% higher than the prior-year quarter's $0.56 per share. GAAP EPS of $0.49 for Q2 were 7.5% lower than the prior-year quarter's $0.53 per share.
For the quarter, gross margin was 68.8%, 220 basis points worse than the prior-year quarter. Operating margin was 19.3%, 120 basis points worse than the prior-year quarter. Net margin was 16.5%, 390 basis points worse than the prior-year quarter. (Margins calculated in GAAP terms.)
Next quarter's average estimate for revenue is $3.97 billion. On the bottom line, the average EPS estimate is $0.65.
Next year's average estimate for revenue is $16.32 billion. The average EPS estimate is $2.75.
The stock has a four-star rating (out of five) at Motley Fool CAPS, with 3,896 members out of 4,461 rating the stock outperform, and 565 members rating it underperform. Among 1,303 CAPS All-Star picks (recommendations by the highest-ranked CAPS members), 1,222 give eBay a green thumbs-up, and 81 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 $63.83.
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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. The Motley Fool recommends eBay. The Motley Fool owns shares of 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.