3 Takeaway's From eBay's Earnings

Paypal and Marketplace both turned in solid results, but Carl Icahn isn't satisfied.

Brendan Mathews
Brendan Mathews
Jan 23, 2014 at 11:40PM
Technology and Telecom

This week, eBay (NASDAQ:EBAY) reported a very solid quarter. Revenue increased 13%, and earnings increased 16%. In this video, Motley Fool Stock Advisor Analyst Brendan Mathews shares his top three takeaways from the quarter. Here's a preview of his conclusions:

1. Paypal continues its awesome streak of growth
Paypal, which has come to compromise 41% of eBay's total revenue, had a great quarter. Revenue for the Paypal segment increased nearly 20%, and active Paypal users increased 16% -- that brings today's total to 143 million active registered users. 

2. Marketplaces results weren't too shabby
Marketplaces revenue increased 12%. Obviously, this segment isn't growing as fast as the Paypal segment, and it faces tough competition, particularly from Amazon.com. But, it's important to keep things in perspective. The Marketplaces segment continues to drive double-digit growth, which should be sustainable for years as more and more shopping is done online versus at physical sites.

3. Icahn -- the ultimate troublemaker
Carl Icahn's plan to spin-off Paypal is more hype than substance. He'd like to separate the Paypal business from eBay in the hopes of driving a near-term increase in his holdings of eBay stock. Admittedly, Paypal as a stand-alone business would certainly be attractive -- but Icahn seems to ignore many of the synergies that exist between eCommerce and online payments. Over the long-term, there's no reason to think that eBay and Paypal won't be more successful together than separately.