eBay Guides Depop To Add 4 Points To Fourth-Quarter GMV Growth After Cutting 9% Of Staff
CFO Peggy Alford says marketing savings in the core marketplace are being redeployed to Depop, whose U.S. users and sold items more than doubled.
eBay is putting more marketing money behind Depop, its secondhand fashion app, CFO Peggy Alford said on the company's third-quarter earnings call Wednesday, and she guided Depop to add four percentage points to fourth-quarter gross merchandise volume growth. The call came a week after eBay announced a roughly 9% workforce reduction.
Marketing savings move to Depop
eBay, which runs an online marketplace for new and pre-owned goods, saw sales and marketing expense rise in the quarter, Alford said, driven by targeted investments in strategic priorities including Depop. Marketing efficiencies in the core marketplace, she said, let eBay "redeploy more resources to capitalize on Depop's extraordinary momentum."
On the layoffs, she called the cut a "difficult decision" meant to better align talent and resources, streamline operations and create capacity to invest in the highest-growth initiatives.
Third-quarter gross merchandise volume (GMV, the total value of goods sold) grew nearly 16% to $23.2 billion on a currency-neutral basis, or 13% organically, with Depop adding nearly three points. Non-GAAP operating income rose 11% to $843 million, and adjusted earnings per share rose nearly 12% to $1.51.
Depop's numbers
Asked by a Morgan Stanley analyst how eBay sets Depop's marketing spend, CEO Jamie Iannone said Depop's U.S. monthly active users and sold items more than doubled year over year on a pro forma basis. Trailing 12-month active buyers reached 11 million from 9 million, and active sellers reached 5 million.
Iannone said eBay and Depop together generated about $9 billion of U.S. fashion GMV over the trailing 12 months, growing in the mid-20% range. eBay is testing individual Depop listings directly in eBay search results, after an earlier test of a dedicated Depop module beside search results.
A Wells Fargo analyst asked about Vinted's aggressiveness in the U.S. Iannone called U.S. consumer-to-consumer fashion a large, under-penetrated market that is not winner-take-all.
Fourth-quarter guidance
For the fourth quarter, Alford guided consolidated GMV of $23.7 billion to $24.1 billion, or 12% to 14% total currency-neutral growth, and revenue of $3.19 billion to $3.24 billion. She expects non-GAAP operating income growth of 6% to 10%, a margin of 25.7% to 26.2%, and adjusted earnings per share of $1.48 to $1.53.
Depop's take rate, the share of sales eBay keeps as revenue, is lower than the core marketplace's, and eBay expects GMV growth to outpace revenue growth. Alford said the company still targets roughly $2 billion of share repurchases for the full year, and its board declared a $0.31 quarterly dividend.
Alford said eBay's 2027 planning assumes healthy growth in GMV, revenue and operating income, with trading cards expected to moderate after an extraordinary 2026.
Sources
- EBay Posts Another Earnings Beat. It Projects Double-Digit Growth for Merchandise Volume. — Barron's
- eBay (EBAY) Q3 Earnings and Revenues Top Estimates — Yahoo Finance
- EBay Stock Jumps After Strong Q3 Results | Investor's Business Daily — investors.com
- eBay rallies after posting strong GMV growth in Q3 (EBAY:NASDAQ) | Seeking Alpha — seekingalpha.com
- ExxonMobil, Leidos, eBay and More: CNBC’s ‘Final Trades’ — benzinga.com
