Ebay sales forecast tops analyst estimates
EBay Inc. (EBAY) forecast 2015 sales that topped analysts’ estimates and said it expects the total volume of merchandise sold in its marketplace to reach $110 billion by that year as the online retailer adds users and mobile tools.
Revenue in 2015 will be $21.5 billion to $23.5 billion, the company said yesterday at a meeting with analysts in San Jose, California. Analysts on average had estimated sales of $21.4 billion, according to data compiled by Bloomberg.
Chief Executive Officer John Donahoe is adding features, including mobile applications and a local-shopping tool unveiled yesterday, to maintain a turnaround effort that has helped boost shares 75 percent since he took the helm from Meg Whitman in 2008. He’s aiming to sustain the pace of sales growth — 21 percent last year — and keep EBay relevant as it competes with the largest Web retailer, Amazon.com Inc. (AMZN) “Investors want to know that there is a road map for strong growth, and management is delivering that message,” said Colin Sebastian, an analyst at Robert W. Baird & Co. “They are laying out multiple incremental growth opportunities, including local commerce, global expansion and, of course, mobile.” The shares rose 4.1 percent to $54.22 at yesterday’s close in New York. The stock has advanced 6.3 percent this year, compared with a 10 percent gain for the Standard & Poor’s 500 Index.
By the end of 2015, 25 percent of users will be in developing regions, EBay said yester- day. As part of a push into new markets, the company said it debuted a Russian-language site two weeks ago. The country posted a 75 percent surge in EBay users last year.
“We are spending aggressively,” said Wendy Jones, vice president of geographic expansion and cross-border trade. “First priority is Russia — it’s a big market, but it’s super- fragmented, and we were already the market leader. We have some wind in our sails in a very fragmented market. So we believe we have a window of opportunity.”
EBay has split emerging markets, including China, Russia and Latin America, into a separate division and has begun by working on a localized approach to Russia, starting with the new native-language site.