EBAY INC Q1 FY2025 earnings call

• Q1 results were ahead of expectations with GMV up nearly 2% to $18.8B, revenue up over 1% to $2.58B, non-GAAP EPS up 10% to $1.38, and $760M returned to shareholders.
• Addressed cross-border trade challenges, focusing on helping sellers/buyers navigate tariffs via SpeedPAK and educating on non-SpeedPAK purchases.
• Focus category GMV growth: collectibles (trading cards) drove growth, fashion category improved customer experience with AI-powered tools and enhanced condition grading.
• Geo-specific initiatives: U.K. C2C initiative improved GMV trends, managed shipping ramp in U.K. to simplify shipping and reduce friction.
• AI-powered tools: simplified listing flow for C2C sellers in U.S., U.K., Germany; Magical Bulk Listing tool for B2C sellers driving results.
• Advertising: first-party ad revenue grew 14%, Active Promoted Listings increased, and offsite ads saw improvements.
• Leadership changes: Steve Priest's last earnings call, Peggy Alford joining as CFO, and organizational structure evolution.

Gross merchandise volume grew by nearly 2% to approximately $18.8 billion, marking the fourth consecutive quarter of positive GMV growth. Revenue increased over 1% to $2.58 billion. Focus category GMV grew by over 6% in Q1 and now makes up more than 1/3 of total volume globally. Advertising revenue was $442 million in Q1, representing GMV penetration of nearly 2.4%.

• Q2 GMV expected between $18.6B - $19.1B (FX-neutral growth -1% to +2%), revenue between $2.59B - $2.66B (FX-neutral growth -1% to +2%), non-GAAP operating margin 27%-27.8%, non-GAAP EPS $1.24 - $1.31.
• Full-year: low single-digit FX-neutral GMV growth, revenue growth modestly higher, non-GAAP operating income growth in line with FX-neutral revenue, capital allocation including at least $2B share repurchases in 2025.

• Trade policy uncertainties, tariffs creating uncertainty for small businesses and impacting consumer confidence.
• Macroeconomic headwinds in international markets, particularly in Germany and U.K., affecting growth trajectories.

Q: How to think about demand elasticity in a pricing-up environment and prior period experiences?

A: Jamie Iannone noted eBay is resilient due to non-new in season inventory and agile sellers.

Q: Impact of China tariffs on China-based exporters on eBay?

A: China-based exporters to U.S. make up ~5% of total GMV, with SpeedPAK helping manage complexity.

Q: Impact of tariffs on advertising revenue?

A: No material impact seen on advertising to date, with strong demand across ad products.

Q: Leveraging pre-owned/refurbished competitive advantage?

A: Leaning in on pre-owned/refurbished with full funnel marketing and investments in tools.

Q: Health of consumers and leading indicators?

A: U.S. demand resilient, Europe (Germany, U.K.) facing macro challenges.

Q: Appetite for M&A in fashion?

A: Using build, buy, partner framework, e.g., acquisition of Certilogo for fashion authentication.

Q: Risks to advertising revenue with China tariffs?

A: Continued momentum in ads, global platform helps mitigate risks.

Q: Collectibles business reaction to macro softness?

A: Trading cards business growing sustainably with innovation and investments.