Skype rings up a loss for eBay
Price cuts ahead
eBay made a loss of $938m in the three months ended 30 September 2007, despite increasing turnover by 30 per cent to $1.89bn compared to last year.
The large loss was blamed on writing off part of the cost of Skype. Earlier this month eBay told the Securities and Exchange Commission that it was taking a charge of $1.4bn relating to the purchase of Skype, details of the SEC filing here. eBay paid $2.6bn for the VoIP firm in 2005.
Ignoring Skype, the company would have made a profit of $593m an increase of 53 per cent on last year's quarter.
eBay's core auction business grew revenues by 26 per cent to $1.32bn. eBay users posted a total of 556 million listings in the three months, an increase of five per cent. The total value of these listings was $14.40bn, an increase of 14 per cent on the same three months of 2006.
PayPal had a decent quarter too, bringing in revenues of $470m, an increase of 35 per cent. Total Payment Volume was $12.22bn.
Skype made net revenues of $98m and the company now claims 246m registered user accounts, up 81 per cent on last year. eBay is still searching for someone to replace CEO Nikolas Zennstrom.
Looking forward, eBay now expects revenue for the full year to be between $7.6bn and $7.65bn.
Meg Whitman, eBay's CEO, said she was disappointed about the Skype write-off but remained confident about the future of the business.
Perhaps taking note of seller complaints, Whitman also announced a 33 per cent cut in US listing fees. The company said the cut was an experiment but it hoped it would help get an improved range of items up in time for Christmas.
eBay's statement is available here as a pdf. ®