eBay Inc. Announces Three-Year Roadmap For Growth


WEBWIRE – Friday, March 13, 2009

Company provides long-term financial outlook at analyst meeting

San Jose, Calif. – eBay Inc. (NASDAQ: EBAY) today shared with investors at a company-held meeting a roadmap of its growth plans through 2011. The company provided details of its strategies to drive leadership in the company’s two core businesses — its PayPal global online payments business and its ecommerce marketplace and other ecommerce formats that connect buyers and sellers.

eBay Inc. continues to rapidly extend its global leadership in online payments through PayPal. John Donahoe, eBay Inc. president and chief executive officer, stressed the enormous potential of PayPal. Donahoe said PayPal has become a second core business for the company, with an opportunity bigger than eBay Marketplaces because PayPal targets all of ecommerce.

“We expect PayPal to become the next leading online global payments network,” Donahoe said. “Increasingly for online consumers, there’s no paper, no plastic – there’s just PayPal. We believe this business is one of the most exciting and high-potential opportunities anywhere online today.”

The company also provided details of its plans to stabilize and return its eBay Marketplaces business to ecommerce market growth rates. At the same time, eBay is diversifying across a range of formats such as classifieds and advertising that are expected to grow faster than ecommerce and help eBay connect buyers and sellers locally, nationally and globally.

“We are aggressively remaking and transforming our eBay Marketplace and diversifying the ways in which we compete in ecommerce,” Donahoe said. “We operate in what is still a young and rapidly evolving ecommerce landscape, and as the pace of change in ecommerce accelerates, we are not here to mimic or follow. We are here to lead and innovate. We are positioning this company to compete and win across a range of profitable ecommerce platforms focused on connecting buyers and sellers across the platform of their choice.”

Outlook
Based on current business trends and expectations, the company provided the following financial outlook for 2011:

* Total company revenues are expected to reach $10 billion to $12 billion in 2011, up from $8.5 billion in 2008, led by strong PayPal growth, Skype and other ecommerce formats.
* Earnings are expected to grow in the mid-single digit range in 2011.
* Free cash flow is anticipated to be between $6 billion and $7 billion over the three-year period from 2009-2011.
* PayPal is expected to significantly increase revenue to $4 billion to $5 billion, in 2011, up from $2.4 billion in 2008, driven by continued penetration on eBay, strong growth off eBay through its merchant services business and expansion into mobile and non-retail payments.
* The company’s eBay Marketplaces business is expected to achieve revenues of $5 billion to $7 billion, in 2011, with a continued shift toward more fixed price sales, a smaller online auction business, and more growth in other ecommerce formats such as classifieds and advertising. To drive long-term incremental growth, eBay Marketplaces also is more aggressively targeting the $500 billion global “secondary” market, which includes liquidation, out of season, excess and off-price inventory. We believe this is a fast-growing segment uniquely suited to eBay’s strengths.
* Skype is expected to more than double its revenue to over $1.0 billion in 2011. With more than 400 million registered users currently, Skype’s metrics continue to accelerate as the company further establishes leadership in free and paid internet-based voice and video communications, with growth opportunities in core consumer, mobile, businesses and platform. Skype’s leadership position has strengthened over the past year, driven by a new management team and the launch of many innovative products.



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