eBay credits mobile user growth, PayPal for boosting Q3 revenues
eBay reported revenues of $3.4 billion for the third quarter of 2012, up 15 percent over the year-ago quarter. Net income rose to $597 million, up 22 percent compared to the third quarter of 2011. eBay adds that active users increased 10 percent year-over-year, its fastest growth since 2007, with 800,000 new users making their first purchase via mobile device.
Speaking to The New York Times, eBay CEO John Donahoe credited the company's growth to early bets on mobile commerce and mobile payments. Downloads of eBay's suite of mobile apps have now eclipsed the 100 million mark globally, and the company is on pace to reach $10 billion in mobile gross merchandise volume in 2012, up from $5 billion a year ago. The company's PayPal unit expects to handle $10 billion in mobile payment transactions in 2012, an increase of 150 percent over a year ago. In addition to its smartphone apps and PayPal Here, which enables small businesses and other users to process credit and debit transactions by swiping cards through a dongle that attaches to their smartphone or tablet, PayPal is currently conducting mobile wallet trials across American retail chains including Home Depot, Abercrombie & Fitch, American Eagle Outfitters, JCPenney, Foot Locker, Office Depot and Toys "R" Us.
"We're the largest mobile commerce and payments provider in the world," said Donahoe. "And we are continuing to innovate. We have a series of innovative apps that people are using. People love shopping on their smartphones and iPad, and PayPal is still the safest way to pay on a mobile phone."
eBay is currently trialing eBay Now, a new mobile app enabling consumers in the San Francisco market to purchase products from retail partners including Macy's, Target and Walgreens and receive their shipment later that same day. "What our research says is that consumers like choice," Donahoe said. "People may want an item to come to their office that day, their house the following day and get other items in a couple days. We're giving them that choice."
Four out of five U.S. smartphone owners accessed retailer websites or applications on their devices in July 2012, according to a comScore report issued last month. Amazon led all destinations with an audience of 49.6 million unique visitors, representing 46.6 percent of smartphone owners, followed by eBay at 32.6 million visitors and Apple (NASDAQ:AAPL) at 17.7 million. If eBay Now is successful, the app could help slash Amazon's lead--its Amazon Prime program offers customers unlimited free two-day shipping on millions of items for $79 a year.
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