"We just think this is a way to stick our competitive advantage right out there and have no questions about why people shop on eBay and why they should". Classifieds had another quarter of strong growth delivering revenue of $199 million, up 7% on an as-reported basis and 10% on an FX-Neutral basis with strength across its German platforms. The increased marketing and product development costs led to a 10.5% increase in operating expenses in the quarter, which led to an 11% decline in operating income to $546 million.
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Ebay Inc reported net income of $538 million during the first quarter of the year.
In the first quarter, Marketplace rolled out a number of new consumer experiences built on eBay's structured data efforts.
The company is looking to improve its market perception and position this year, and is scheduled to launch two new programs over the next few months: 1) new authentication program for high-end goods; and, 2) guaranteed 3-day delivery program for about 20 million products on its website. During Q1, StubHub also became the official ticket resale marketplace for the Major League Baseball teams the Los Angeles Angels and Toronto Blue Jays. Classifieds continued to enhance user experiences across its platforms, counting launching a personalized homepage feed on Marktplaats.nl, in addition to expanding its inventory integration with the eBay Marketplace platform across multiple regions.
eBay recently announced a strategic agreement with Flipkart. The e-commerce company's shares dropped 4.5 per cent after wrapping up at US$33.85 at the New York Stock Exchange. The companies will also exclusively pursue cross-border trade opportunities together. This is up from the $2.12 billion that was reported in the first quarter of 2016. Non-GAAP operating margin decreased to 30.0% in the first quarter of 2017, compared to 33.4% for the same period previous year. The company's total repurchase authorization remaining as of March 31, 2017 was $986 million.
eBay's balance sheet is highly leveraged, with total debt of $9 billion eclipsing cash and short-term investments balance of $6.8 billion. Wall Street analysts had forecast eBay to earn 48 cents a share on $2.32 billion in sales for the quarter that ends in June.
Also in terms of guidance for the coming quarter, the company expects net revenue to be in the range of $2.28 billion to $2.32 billion with EPS between $0.43 and $0.45.
EBay has been in a bit of a turnaround mode for more than a year since the company spun off its PayPal electronics-payments business as a separate company. Price to sales ratio was 4.07 while 87.10% of stock was owned by Institutional investors.