By Jim Battey E-Commerce Times
01/16/02 4:42 PM PT
Despite the stellar earnings report, one analyst said that EBay cannot rest on its
laurels if it hopes to maintain growth in the current environment.
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Online auction giant EBay (Nasdaq: EBAY) reported
record fourth-quarter revenue Tuesday of US$219.4 million and pro forma net income of
$38.5 million, easily beating analyst expectations.
Bolstered by a strong holiday shopping season, EBay's quarterly revenue was the
highest ever for the company, representing a 64 percent gain over the $134 million
generated last year, and was the auction company's 13th consecutive profitable quarter.
For all of 2001, EBay reported revenue of $748.8 million and pro forma net income of
$137.5 million.
Success Breeds Confidence
"Our fourth-quarter results capped off an outstanding year," said EBay President and CEO
Meg Whitman. "We have excellent momentum going into 2002 and feel confident with our
long-term strategy, ongoing execution, and the inherent strength of our business
model."
EBay attributed the increase in income to better-than-expected holiday sales in the
U.S., strong international growth, and third-party advertising revenue. The company
said the best-performing categories in the fourth quarter included EBay Motors,
computers, collectibles, sports and toys.
Key Challenge
Some analysts have suggested that despite the company's strong performance , the biggest
dilemma for EBay is meeting investor expectations.
Potential growth categories to keep an eye on in 2002, according to analysts, include
consumer electronics, EBay Motors and EBay's international sites.
In the past, EBay has estimated that revenues will hit $3 billion per year by 2005.
EBay's stock has held up relatively well in recent weeks. At the close of regular
trading Tuesday, EBay shares were at $64.06 per share, up 46 percent from their
post-September 11th low. The earnings report was released just after the close.
The Real Test
A number of research reports released earlier this month indicated that online
holiday sales were stronger than expected. Online
portals such as Yahoo! (Nasdaq: YHOO) and America
Online also reported that consumers were spending money on their shopping sites
in record numbers.
Still, the most accurate assessment of the success or failure of the e-tail holiday
season lies in the e-tail companies' earnings statements, and EBay is the
first big e-tailer to report this year.
Yahoo! is scheduled to release earnings on Thursday and
Amazon.com's (Nasdaq: AMZN) report is
slated for January 22nd.
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