eBay beats Q4 expectations, GMV down 5%

eBay said gross merchandise volume was down 5% year over year to $23.3 billion.

eBay's fourth quarter financial results edged out above analyst expectations, but the company's gross merchandise volume declined in the quarter and its guidance for Q1 and fiscal 2020 came in light. 

The San Jose, Calif.-based e-commerce company reported fourth quarter net income of $558 million, or 69 cents per share. Non-GAAP earnings were 81 cents per share on revenue of $2.82 billion, down 2% from the same period last year.

Wall Street was looking for earnings of 76 cents per share on revenue of $2.81 billion.

For its full year, eBay reported revenue of $10.8 billion, up 1% compared to 2018, and earnings of $2.32 per share.

eBay said gross merchandise volume was down 5% year over year to $23.3 billion. The bulk of the revenue came from eBay's Marketplace platforms, which the company said delivered $22 billion of GMV and $2.2 billion of revenue. StubHub delivered revenue of $321 million, up 2% from the same period last year, and revenue from eBay's classifieds business came to $269 million

Elsewhere, eBay said it grew active buyers by 2% across its platforms, for a total of 183 million.

"I am proud of how well our teams have executed over the past year and the innovative solutions we have provided for our buyers and sellers," said Scott Schenkel, eBay's interim CEO. "As we enter 2020, our priorities are clear - we will continue to drive revenue through our growth initiatives, deliver more seller tools, improve the buyer experience by leveraging our structured data foundation, all while driving more margin expansion. We believe these efforts will position us for sustainable, profitable long-term growth and I am excited by the opportunities ahead."

Last March, eBay began to face investor-led pressure to restructure and sell some of its businesses. In response, the company's board approved a strategic review of eBay's assets, which included its ticket subsidiary StubHub. In September eBay announced CEO Devin Wenig was stepping down. A month later, eBay made a deal to sell StubHub to Swiss ticket resale marketplace viagogo for $4.05 billion. The sale is expected to close by the end of eBay's first quarter of 2020.

After concluding its operating review in October, eBay announced a three-year plan to improve margins and reinvest in customer initiatives. The company said its plan for operating efficiency, combined with reinvestments and 2019 margin expansion, should drive 3 points of additional operating margin by 2022 and create capacity to reinvest in customer initiatives. 

In terms of guidance, eBay said it expects revenue between $2.55 billion and $2.60 billion and adjusted profit between 70 cents to 73 cents per share for the current quarter. Analysts are looking for Q1 revenue of $2.64 billion and EPS of 70 cents. 

For full year 2020, eBay said it expects net revenue between $10.72 billion and $10.92 billion and earnings per share in the range of between $2.95 and $3.05. Wall Street expects eBay to report fiscal year revenue of $10.92 billion and earnings of $2.86 per share.

Shares of eBay were down more than 4% after hours.