What is eBay Inc. (EBAY)?

BY Chris Andreou

|September 15, 2021

Trade a global e-commerce leader

eBay Inc. is an American global e-commerce corporation that connects millions of buyers and sellers in more than 190 markets worldwide.

Pierre M. Omidyar founded eBay Inc. in 1995 and is currently headquartered in San Jose, California. The company’s Marketplace platform includes its online marketplace at ebay.com and the eBay suite of mobile apps, offering consumers a wide range of inventory and choices.

The company’s platforms also enable economic opportunity for individuals, entrepreneurs, businesses and organisations of all sizes.

Users can list, buy, sell, and pay for items through various online, mobile, and offline channels that include retailers, distributors, liquidators, import and export companies, auctioneers, catalogue and mail-order companies, classifieds, directories, search engines, commerce participants, shopping channels, and networks.

Brief History

In 1995, Pierre Omidyar sold a broken laser printer to Canadian native Mark Fraser through what was originally called “Auction Web”.

The printer marked the first-ever sale for eBay, which was auctioned off for $14.83 at the time.

27 years later, the company now boasts a market capitalisation of $47.24 billion.

In 1996, Jeffrey Skoll was brought in as a business partner. And before they knew it, the company was selling plane tickets via a third-party licensing deal.

By 1997, eBay had crested two million auction transactions.

1998 saw Meg Whitman take on the role of CEO, with eBay recording revenues of $4.7 million. Whitman led eBay to a 1998 public listing with the company’s share price listed at $18, making Omidyar an instant billionaire, as the stock price soared to $53 per share on the first day of trading.

The company’s name was officially changed to eBay after receiving $6.7 million in funding from venture-capital firm Benchmark Capital.

2002 saw the PayPal x eBay acquisition, which was valued at $1.5 billion, and by 2011, PayPal had reached 100 million users – a real milestone for the e-commerce giant.

By 2012, eBay had grown into a $3.3 billion company. And five years later, revenues had grown to $9.56 billion, in addition to adding Skype and StubHub to its brand.

Sharpening The Business Model

Over the next decade, eBay defined its simple, yet highly effective, business model – bringing buyers and sellers together on one online platform and charging a fee for any transactions completed.

eBay-inspired terms like “Buy it Now”, “Seller Rating” and “Best Match” paved the way for other online consumer retail exchanges like StubHub and Amazon.com to take on the eBay model and use it as a blueprint for their own retail platforms.

eBay ultimately grew into a global e-commerce powerhouse, with 187 million users worldwide, and a highly successful mobile app used by 34.9 percent of all US mobile users.

Overall, under the purview of e-commerce companies, both eBay and Amazon stand out as the long-standing key players in the marketplace.

Current Situation

Across the globe, the spread of the virus led to lockdowns in various cities and economies, having a serious effect on both industrial and economic activity.

Over the past 18 months, the coronavirus pandemic fuelled the e-commerce boom as the world witnessed a huge surge in “stay-at-home” shopping.

In Q2 2020, eBay gained 8 million buyers as online marketplaces gained more traction during this time.

Revenue was $2.9 billion, up 18% y-o-y while Gross Merchandise Volume was recorded at $27.1 billion, up 26% year-over-year.

In addition, we are now seeing an increase in demand for online and in-person shopping due to improving consumer sentiment and a recovering job market.

Recent Financial Results

According to reports, the company’s net revenues increased 14.2% year-over-year to $2.67 billion in its fiscal second quarter, which ended June 30th.

Its gross profit stood at $2.00 billion, up 4% from the same period last year. Its net income grew 1,338.9% from its year-ago value to $10.73 billion.

The company’s EPS increased 1,393.3% year-over-year to $15.68.

Who Are The Key People?

Jamie Iannone currently acts as President and CEO of eBay, while Paul S. Pressler acts as Chairman. Mazen Rawashdeh is the Chief Technology Officer & Senior Vice President.

3.82% of eBay’s shares are held by company executives, directors and other insiders.

Past & Expected Financial Performance

According to analysts, eBay’s revenue is likely to increase 1.6% in the current year and 5.4% in the next year.

In the current quarter, the company’s EPS is expected to grow 4.7%, 15.5% in the current year, and 12.7% in the next year.

Over the next five years, its EPS is expected to grow at an 11.9% rate per annum.

According to market experts, eBay is deemed profitable with gross profit and EBITDA margins of 73.90% and 31.06%

How Can I Trade eBay?

eBay is listed as a tradable asset under the ticker EBAY on TIOmarkets MT4 or MT5. Like all other assets listed on our platforms, you can choose to long or short.

What Are The Best Trading Conditions?

As we’ve seen with the recent pandemic, the stock markets can be prone to large swings up or down based on economic turmoil, recovery and economic conditions.

Execution speeds: Slow order execution speeds can lead to a big difference between the price you see when you click to open a trade, and the actual price your order is opened at. This difference between prices is called “slippage”.

At TIOmarkets, we have some of the fastest execution speeds you can find, resulting in minimal slippage and more orders filled at the price you clicked.

Leverage: Normally, a large amount of starting capital is required to invest seriously in stocks and indices, because only a small amount of stocks is not likely to yield the kind of results most traders are seeking.

High leverage can greatly increase both the risk to your investment and the potential returns.

If you are comfortable with a high level of risk in return for higher potential gains, you may want to seek a leverage ratio that is commensurate with your investment goals.

Sign up with TIOmarkets for the access to eBay stocks with lowest-cost account conditions from $0-commissions per lot and raw spreads. Discover the world’s largest forex and stocks markets at the world’s lowest costs, today. Visit www.tiomarkets.com/register to get started.

Risk disclaimer: CFDs are complex instruments and come with a high risk of losing money rapidly due to leverage. You should consider whether you understand how CFDs work and whether you can afford to take the high risk of losing your money. Never deposit more than you are prepared to lose. Professional client’s losses can exceed their deposit. Please see our risk warning policy and seek independent professional advice if you do not fully understand. This information is not directed or intended for distribution to or use by residents of certain countries/jurisdictions including, but not limited to, USA & OFAC. The Company holds the right to alter the aforementioned list of countries at its own discretion.

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Trade responsibly: CFDs are complex instruments and come with a high risk of losing all your invested capital due to leverage.