EBay Inc. (EBAY) has reported an 114.73 percent jump in profit for the quarter ended Mar. 31, 2017. The company has earned $1,035 million, or $0.94 a share in the quarter, compared with $482 million, or $0.41 a share for the same period last year. On the other hand, adjusted net income for the quarter stood at $538 million, or $0.49 a share compared with $550 million or $0.47 a share, a year ago.
Revenue during the quarter grew 3.74 percent to $2,217 million from $2,137 million in the previous year period. Gross margin for the quarter contracted 91 basis points over the previous year period to 76.77 percent. Total expenses were 75.37 percent of quarterly revenues, up from 71.27 percent for the same period last year. That has resulted in a contraction of 410 basis points in operating margin to 24.63 percent.
Operating income for the quarter was $546 million, compared with $614 million in the previous year period.
However, the adjusted operating income for the quarter stood at $665 million compared to $714 million in the prior year period. At the same time, adjusted operating margin contracted 342 basis points in the quarter to 30 percent from 33.41 percent in the last year period.
"The first quarter was a strong start to the year with accelerating growth in active buyers, revenue and our core U.S. business," said Devin Wenig, president and chief executive officer of eBay Inc. "We are on the right path as we continue to evolve our shopping platform for consumers, leverage our technology advantages and market a sharpened eBay brand globally."
For financial year 2017, EBay Inc. projects revenue to be in the range of $9,300 million to $9,500 million. It projects adjusted revenue to be in the range of $9,300 million to $9,500 million. It forecasts diluted earnings per share to be in the range of $1.85 to $2.10. It forecasts diluted earnings per share to be in the range of $1.98 to $2.03 on adjusted basis for the same period.
For the second-quarter, EBay Inc. projects revenue to be in the range of $2,280 million to $2,320 million. It projects adjusted revenue to be in the range of $2,280 million to $2,320 million. It forecasts diluted earnings per share to be in the range of $0.20 to $0.40. It forecasts diluted earnings per share to be in the range of $0.43 to $0.45 on an adjusted basis for the same period.
Operating cash flow declines
EBay Inc. has generated cash of $582 million from operating activities during the quarter, down 9.20 percent or $ 59 million, when compared with the last year period.
The company has spent $115 million cash to meet investing activities during the quarter as against cash outgo of $1,075 million in the last year period.
The company has spent $418 million cash to carry out financing activities during the quarter as against cash inflow of $1,222 million in the last year period.
Cash and cash equivalents stood at $1,979 million as on Mar. 31, 2017, down 26.32 percent or $707 million from $2,686 million on Mar. 31, 2016.
Working capital drops significantly
EBay Inc. has witnessed a decline in the working capital over the last year. It stood at $4,060 million as at Mar. 31, 2017, down 46.55 percent or $3,536 million from $7,596 million on Mar. 31, 2016. Current ratio was at 1.92 as on Mar. 31, 2017, down from 4.61 on Mar. 31, 2016.
Days sales outstanding went down to 25 days for the quarter compared with 26 days for the same period last year.
At the same time, days payable outstanding went down to 56 days for the quarter from 60 for the same period last year.
Debt remains almost stable
EBay Inc. has recorded a decline in total debt over the last one year. It stood at $8,966 million as on Mar. 31, 2017, down 0.77 percent or $70 million from $9,036 million on Mar. 31, 2016. Total debt was 36.14 percent of total assets as on Mar. 31, 2017, compared with 46.08 percent on Mar. 31, 2016. Debt to equity ratio was at 0.77 as on Mar. 31, 2017, down from 1.43 as on Mar. 31, 2016. Interest coverage ratio deteriorated to 45.50 for the quarter from 26.70 for the same period last year.
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