eBay Squeaks Out A Win In Q4, With Revenue Of $4.5B And $0.81 EPS

eBay reported its fourth-quarter earnings today, including revenue of $4.5 billion and non-GAAP earnings per share of $0.81. The company’s revenue was up 13 percent from the same quarter last year, while its earnings per share rose 16 percent.

It’s a fairly temperate showing from eBay, as analysts have been expecting eBay to report a 16 percent profit increase on revenue of $4.5 billion and $0.80 EPS (non-GAAP). The main drivers of eBay’s fourth quarter results have expected to be a decline in its marketplaces and auctions segment, with a boost from PayPal.

In its most recent sequential quarter, eBay reported revenue of $3.9 billion, and non-GAAP earnings per share of $0.64. While the consensus estimates for the fourth quarter were around $0.80, many expected the reality to be slightly lower thanks to a relatively tepid following eBay’s somewhat tepid sales during the holiday season.

eBay’s global payments unit, PayPal, saw revenue increase 19 percent again this quarter, as well as the full year, resulting in what the company says is a $6.6 billion in revenue in 2013. In turn, PayPal gained 5.2 million active registered accounts in the quarter and ended the year with 143 million — a 16 percent increase.

“We feel good about our performance and strong finish in the fourth quarter, with the holiday shopping season clearly showing how online, mobile and other omni-channel commerce capabilities are changing how consumers shop and pay,” said eBay CEO and President John Donahoe in today’s statement.

“Mobile exceeded expectations for the year. Our total mobile commerce volume grew 88 percent, with eBay reaching $22 billion and PayPal hitting $27 billion in 2013. And mobile added more than 14 million customers. PayPal and eBay together create an incredibly strong global commerce ecosystem for consumers and merchants, and we continue to see tremendous growth opportunities ahead,” he continued.

Going a little bit deeper, eBay’s operating margin jumped to 29.2 percent in the fourth quarter, with the company generating $1.4 billion of free cash flow during the fourth quarter. For the full year, eBay generated $3.7 billion in free cash flow and repurchased approximately $254 million of its common stock in the fourth quarter.

Furthermore, eBay’s Marketplace saw revenue of $2.3 billion and both it and PayPal saw record mobile results for the year in 2013, both surpassing $20 billion in mobile volume. Marketplaces’ gross merchandise value (GMV) grew 13 percent in both the fourth quarter and the full year to $76.5 billion in 2013, which eBay attributes to “strong growth in its domestic business.”

In turn, revenue grew 12 percent in Q4 and for the year, reaching $8.3 billion in 2013, while gaining 4.6 million active users in the quarter and ending the year at 128 million active users.

eBay also reported a net income of $850 million and non-GAAP net income of $1.1 billion for the forth quarter. Meanwhile, beyond the $254 million of stock it repurchased in Q4, the company is reportedly considering a $5 billion stock buyback, which has received “proposals” from billionaire investor Carl Icahn, according to Bloomberg.

This, as with many Icahn-related stories, comes with a number of addenda and propositions for eBay, some more realistic than others. According to Bloomberg, the investor-activist has also reportedly nominated two of his employees to its Board of Directors, along with proposing a potential spinout of PayPal.

One are many analysts were paying close attention to in eBay’s Q4 results were PayPal’s numbers — particularly as a function or indicator of the health (or lack thereof) of Bay’s mobile business. Something that, as seen above, was reflected in Donahoe’s statement today.

To quickly break this out for those following along at home, generally speaking, compared to both tech giants and startups alike, the company (i.e. PayPal) has lagged behind a bit in mobile payments race. It’s for this reason that eBay shelled out a hefty $800 million to acquire Braintree, a deal which closed in Q4 (as well as StackMob) — to help PayPal compete and boost its mobile presence.

In a positive sign for eBay, according to its earnings report, mobile was a “key catalyst” for PayPal’s growth this quarter, with payments volume off eBay “growing 128 percent for the year,” and total payment volume for the year hitting $27 billion.

As for its 2014 outlook, the company said that it expects net revenues to be between $4.1 and $4.2 billion with EPS in the range of $0.51 to $0.53 and non-GAAP EPS in the range of $0.65 to $0.67. For the full year, eBay estimates that it will see $18 billion to $18.5 billion with non-GAAP EPS in the range of $2.95 to $3.00.