eBay’s net income increased 20% in the first quarter, to $570 million or $0.44 a share, from the same quarter a year earlier. Revenue increased 29% to $3.3 billion. Net income was $0.55 a share, excluding special items. This was above the expectations of Wall Street analysts, who predicted $0.51 a share and revenue of $3.15 billion.
The company’s chief executive, John J. Donahoe, described the numbers as “a strong start of the year” and hinted at the need to do more with mobile devices. eBay’s future depends on how well it enables consumers to conduct business on their mobile devices. eBay posted $15 billion in mobile transactions last year.
Mr. Donahoe has been trying to create a turnaround at the company for several years. He said, “We are enabling commerce in this new retail environment, supporting and partnering with sellers of all sizes and giving consumers worldwide the ability to shop any time, anywhere, for whatever they want.”
The soaring popularity of the PayPal online payment system helped eBay’s earnings. PayPal had 109.8 million active registered accounts in the first quarter of 2012, 12% more than the same quarter a year ago. For the first time, half of PayPal’s revenue came from overseas.
Colin Gillis, an analyst at BGC Partners, said that PayPal is the fastest growing division of eBay, accounting for 32% growth year over year. He said, “PayPal is the growth driver of this company. PayPal continues to be a star. Marketplaces is showing clear signs of turning around. Business is growing. And they’re positioned for the future.” PayPal posted around $31 billion in total transactions in 2011 and accounted for almost a third of the company’s annual revenue.
eBay has also seen a sustained turnaround of its Internet marketplace. The online marketplace posted double-digit growth, with an increase of 11% over the same period last year.