Is eBay Profitable 2024?

eBay was one of the first companies to introduce buying and selling items online and opened a new world of shopping for people. But after Amazon took over the title, people have been wondering is eBay profitable now, how is the company doing?

In this guide, let us explore how it all started, how eBay once became the most popular e-commerce website, and see how it has been performing financially for all these years now.

Is eBay Profitable

eBay Key Statistics

  • In 2022, eBay generated a revenue of $9.7 billion as compared to the revenue of $10.42 billion in 2021, showing a decrease of 9.3%.
  • 138 million people use eBay in the U.S.
  • There are 8.3 million seller accounts on eBay.

eBay in a Nutshell

Founded1995
HQSan Jose, California
Business typePublic (NASDAQ: EBAY)
PeoplePierre Omidyar (founder), Jamie Iannone (president & CEO), Thomas J Tierney (chairman)
IndustryE-commerce

History Of eBay

history of eBay

eBay is an e-commerce platform that was established in 1995. The company initially offered only auction services, but later, it expanded its business model to Business-to-Consumer.

The company became so successful by the early 2000s that it went on to purchase a number of companies, including Skype for $2.6 billion and Stubhub for $301 billion; however, eBay does not own these anymore.

By 2001, eBay became one of the largest e-commerce websites, and it purchased PayPal for $1.5 Billion that year. Since online shopping was not that common at that time, eBay’s amalgamation with PayPal played a very important role in preventing scams and frauds.

By 2010, however, Amazon emerged stronger than ever, snatching the title of the world’s largest e-commerce platform from eBay.

Shortly after that, eBay started losing its luster and sold Skype to a private equity group in 2011. Consequently, it spun out PayPal in 2014 since it became bigger than eBay.

Ever since the PayPal split, eBay has been focusing on growing and maintaining its customer base, which is majorly in the U.S. and U.K.


The Business Model of eBay Explained

As mentioned earlier, eBay operates on a Business-to-Consumer model. This means that eBay earns money from advertisements, listings and transactions that people make on this platform.

And the transaction volumes that drive eBay’s revenues are called Gross Merchandise Volume (GMV).

For example, in 2021, $87 billion worth of merchandise was sold on eBay, and in that year, eBay made $9.77 billion in transaction revenues. This means 11.19% of it was eBay’s take rate or fees.


eBay’s Financials In The Year 2023

EBay's Financials In The Year

In the first quarter of 2023, eBay’s revenue from advertising was $317 million, and its GMV from transactions was $18.4 billion.

For the same quarter, the net income of eBay was $569 million, an increase of $1.9 billion from the revenue of -$1.34 billion made in the first quarter of the previous year.

eBay’s fiscal results for the third quarter ended Sept. 30, showed:

  • In the third quarter of 2023, eBay made 2.5 billion U.S. dollars in revenue, up 5% on an as-reported basis.
  • eBay’s overall GMV has also increased to $17.99 billion. However, its GMV for the third quarter decreased from the GMV of 418.21 billion in Q2.
  • The active buyers on eBay have decreased by 3% year over year, reaching 132 million.

Is eBay Profitable?

eBay made a net loss of $1.27 billion in 2022 compared to the net profit of $13.6 billion it made in 2021. So, as per last year’s data, eBay is not profitable. But if we look at eBay’s performance over the years, it has made net loss only in 2017 and 2022, and for the rest of the years since 2005, eBay has been consistently profitable. 

However, eBay has been performing better in 2023, and in the last quarter ending September, it even made 2.5 billion U.S. dollars, an increase of 5%. The final fiscal results of eBay are yet to be made, after which it will be clear if eBay was profitable in 2023.

eBay’s net revenue was the highest in the fourth quarter of 2018 when it reached almost 2.9 billion U.S. dollars in revenue.


eBay’s Profits (2013 – 2022)

eBay made a net loss of $1.2 billion in 2022, showing a decline of 109% decline from 2021.

eBay Annual net income

eBay’s Annual Revenue (2013 – 2022)

In 2022, eBay made $9.7 billion in revenue, a decline of 9.3% compared to 2021 figures.

eBay’s Annual Revenue

eBay’s GMV’s

The annual gross merchandize volume of eBay in 2022 was $18.2 billion, a decrease of 12% compared to the GMV in 2021.

eBay annual gross merchandize volume

eBay Annual Users 2013 to 2023

There are 129 million active users on eBay in 2023, a 6% decrease from the previous year.

eBay Annual Users

Is eBay Declining?

In spite of intense competition and loss of cash flow in 2022, eBay has been surpassing expectations in 2023 by performing well.

eBay still has a solid user base, and one year’s setback does not mean eBay is declining.

The results of the 2023 quarter tell us that eBay might turn a profit this year, and overall, eBay is a growing company.


Wrap Up

eBay is still relevant and famous today. The company makes revenue largely from advertising, online sales, and listings. eBay has made a loss only twice since 2010, which is a testament to eBay’s solid business model.

The company’s business strategy remains the same. It still tries to acquire business, and now it is even trying to incorporate new technologies to keep up with the changing trends.

We hope you found this article on: Is eBay Profitable helpful.


FAQ’s

How is eBay performing as compared to Amazon?

By generating a revenue of $514 billion, in comparison to eBay’s revenue of $10 billion, Amazon has surpassed eBay in great contrast.

Is selling on eBay profitable?

Yes, selling on eBay is extremely profitable. The profit percentage obviously depends on what you are selling and the price at which you acquired the product. A certain person even shared that he sold a product for $100 that cost him nothing.

What is the most profitable items to sell on eBay?

A lot of people sell vintage clothing items for a great price; some even run a sneaker reselling business for an insane profit margin. So, these are the two most profitable items to sell on eBay.

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