eBay has warned that its second quarter revenue will be around $2.49 - $2.54 billion USD, which is less than what investors expected.
👉 Background: eBay, one of the OG online auction places, which launched in 1995 was like the internet's garage sale. You could buy Pez dispensers, limited edition sporting memorabilia and random bits of old clothing.
👉 What happened: eBay has warned that its second quarter revenue will be around $2.49 - $2.54 billion USD, which is less than what investors expected. But competition from e-commerce giants like Amazon has hit eBay hard.
👉 What else: Despite eBay's lower revenue, eBay's gross merchandise value is still expected to grow.
💡Gross Merchandise Value, or GMV, measures the total value of goods sold over a specific period within a marketplace.
💡It's a vital sign used by online marketplaces like eBay and Amazon. For example, eBay takes a fee of roughly 14% of the sale price of each item it sells.
💡A growing GMV signals to investors that the platform is thriving. But ultimately if eBay can’t extract enough revenue from its marketplace sales, then it’s never going to be able to battle it out with the big dawg of Amazon.
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