Ticket Sales Drove eBay Earnings

Without PayPal under its umbrella to prop it up, eBay’s earnings last week showed even more just where the company is struggling.

But, one bright spot for eBay, StubHub is doing quite well for the eCommerce company. EBay has officially started breaking out how much money StubHub brings in for the company that acquired it in 2007 for $310 million.

Interestingly enough, StubHub is eBay’s strongest business in terms of sales growth. What eBay’s Q4 results showed is that StubHub’s business grew 34 percent YOY, with annual revenue of $725 million. That accounts for roughly 9 percent of the company’s sales. This is particularly important for eBay as it looks to give its marketplace business a much needed boost.

While its marketplace division stalled on growth, StubHub produced more than $1 billion in GMV, a 30 percent increase from the year prior. EBay’s total GMV for Q4 were $21.8 billion. Overall, without taking currency changes into account, eBay’s GMV for Q4 were up 5.1 percent in Q4. eBay’s GMV for all of 2015, however, fell 1 percent to $82 billion.

This earnings season was the first time eBay decided to disclose StubHub’s revenues, which was perhaps on purpose now that eBay doesn’t have its once rising star, PayPal, under its belt to help mask its marketplace struggles. In terms of profit, however, eBay still doesn’t break out how much StubHub brings in for the company.

The reason for that is likely because of what eBay CEO Devin Wenig pointed to during the earnings call with analysts last week, which is that StubHub’s earnings fluctuate based on it being an event-based business that can change so much depending on what events are hosted that year, where and how much they’re able to bring in. As a reuslt, the “take” rate for eBay varies so much per event.

“StubHub also bounces around quarter to quarter based on the events. It’s much more choppy than eBay just because it sort of depends what the matchup is in the Super Bowl and what the events landscape is, and it was a very strong events landscape,” Wenig said. “So, I would expect StubHub to keep growing. I’m not sure I’d expect it to keep growing at this rate, but it’s a good business, and … we’re proud of the fact that we’ve been able to grow StubHub using some of the eBay traffic flywheel over the last several years.”


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