eBay Q4 Earnings To Offer Insight On Managed Payments

Earnings season marks a scorecard of sorts, a regularly scheduled progress report on top and bottom lines and, in payments, a seemingly inexorable shift toward frictionless commerce.

To that end, Tuesday (1/29) we will get insight into how eBay is faring with its efforts to manage payments across its U.S. marketplace. The company said in its third-quarter earnings report roughly three months ago that it intermediated $38 million of gross merchandise value in its first month of managed payments.

And though the value reported back then correlated to less than two tenths of 1 percent of gross merchandise value for the quarter, at $22.7 billion, the first full quarter should give an indication of how the new initiative – which was announced early in 2018 – is progressing.

As reported in this space back then, the initiative represented a shift of sorts to a payments ecosystem that allows consumers to check out and pay on the site, using localized payment options where they are shopping. The annualized run rate of such managed payments spans more than half a billion dollars, said the company during its third-quarter remarks, with several thousand sellers embracing 900,000 transactions through managed payments during the first month of service, which kicked off at the end of September.

Looking ahead, we’ll see how the eCommerce giant has fared with total marketplace GMV, where in the third quarter growth was 5 percent year on year to a tally of more than $22 billion, and where active buyers were up at a slightly slower pace, at 4 percent to $177 million.

Separately, the company has said that 12 percent of customers using iPhones or other Apple devices have used the Apple Pay option across the platform.

Management had stated in October that growth will slow in the near term as eBay works to “balance” what existing customers want with the desire to bring new consumers on board. As has been reported, CFO Scott Schenkel said on the last earnings call that sellers who had been working for a long time with PayPal tended to stick with that service.

The company said that net revenue should come in at a range between $2.85 billion to $2.89 billion, a growth rate measured year over year between 4 percent and 6 percent. Analysts expect $2.87 billion on the top line.

There’s an added wrinkle in the fact that activist investor Elliott Management has disclosed a 4 percent stake in eBay as of last week, and in an open letter to the company said that the firm should, among other things, spin off StubHub and its classifieds business. Such actions, maintained the investment firm, would allow eBay to focus on its core retail marketplace operations.