- Registered Users increased by 6.6 million users from the 2nd Quarter to the 3rd Quarter of 07' but Active users actually declined by 300, 000, for what appears to be the first time in company history. Active users are defined as users who have bid, bought or listed an item on the site in the previous 12 months. Is this a sign of a healthy marketplace business?
- eBay Stores reached a high of 649,000 stores/shops worldwide in the second quarter of o7' but dropped more than 20% in the 3rd Quarter to 520,000 that is also a 9% drop Y/Y. This is not store listings mind you this is actual store closings. A 20% drop in store closings from one quarter to the next should send shockwaves through the financial community. eBay Stores are not for casual sellers. Storeowners are committed to the site for at least 30 days with each item listed. To see a drop of 20% from one quarter to the next should send off alarms. Where are these 129,000 sellers going? Update: As some of my readers have pointed out and Ina Steiner posted today, eBay is not including the China Stores numbers. Ina reports that US Stores held steady from Quarter to Quarter so the decline was in International stores. I have no idea how many were from China.
- GMV growth in 2007 is flat and it appears the only thing keeping eBay from seeing a GMV decline is the stellar growth of StubHub. If you exclude the GMV from StubHub you will see the true state of the eBay Marketplace business. StubHub was a great acquisition but its success is masking even greater problems within eBay Marketplaces (in the US).
Core listings are down 3% Y/Y, this after eBay raised fees in stores last August to re-balance the marketplace. Instead what we've seen is a decline in CORE listings as well as a huge number of store closings.
- Sellers are leaving eBay in droves (at least 129,000 of those 300,000 active users who disengaged were sellers) and management is able to mask the exodus with benefits from FX (foreign exchange), one time tax breaks, increases in Non-GMV revenue and stellar results from StubHub. Sure the company as a whole is doing well but when you start to peel away the layers of the US Marketplace numbers the CORE smells rotten.
I'm just a blogger asking these questions. Why aren’t investors asking these same questions? How long will eBay be able to mask the decline of the Marketplace business? This is very serious and speaks to why there seems to be a disconnect between what sellers are seeing in their own operations and what eBay is telling investors.
Just my 5 Cents! What am I missing here?