As eBay gets ready to spin off Paypal, the company reported strong second quarter results on Thursday. EBay beat Wall Street’s expectations, growing 7 percent in the quarter.
EBay (EBAY) updated its guidance for the year, estimating a growth of 3-5% instead of 0-5%.
PayPal will cleave from eBay Friday, 13 years after being acquired by the company, and it looks well-positioned to grow on its own. The service saw 11% growth in active user accounts, totaling 169 million users. PayPal has also enjoyed rising engagement, with usage up to 24 times per year per account, compared to 21 times last year.
eBay also announced it would be selling off eBay Enterprise, which helps online retail sites, for $925 million. The spin-offs are part of eBay’s strategy to focus on its core business, eBay marketplaces. For that business, sales decreased 3 percent in the second quarter. A data breach last year forced users to change their passwords, which slowed usage. Meanwhile the marketplace faces intense competition from Amazon, as well as more niche sites like Etsy, Poshmark or Chairish. Last year, when the global e-commerce market grew 22 percent, eBay’s marketplace only grew 6.4 percent, according to CNBC.
President of eBay Marketplaces and CEO Designee Devin Wenig is optimistic. “We intend to focus on our target customer base and on a market segment where we believe we can win,” he said during a conference call.
