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EBay Announces Plans to Cut Jobs and Units in Q4 Report

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EBay Announces Plans to Cut Jobs and Units in Q4 Report

paypal headquarters

Paypal Corporate Headquarters Sign.
SAN JOSE CA/USA – MARCH 1 2014: PayPal Corporate Headquarters Sign. PayPal is an international e-commerce business allowing payments and money transfers to be made through the Internet.

EBay announced plans to shed both jobs and units in its Q4 report. The online auctioneer is set to cut 2,400 jobs (about 7% of its workforce) in attempt to “compete and win” and to simplify its organizational structure. The report’s release sent the company’s stock up about 2.3%.

eBay (NASDAQ:EBAY) reported fourth quarter revenue of $4.9 billion, which is up 9% from last year. The company’s net income is also up 10% at $936 million. Adjusted earnings per share were $0.90.

News of the company’s plans to cuts jobs wasn’t surprising. eBay announced in September that it plans to spinoff PayPal in 2015. Additionally, the company is exploring an initial public offering or sale of eBay Enterprise. The job cuts will take place in the first quarter and will affect eBay Marketplaces, eBay Enterprise and PayPal.

What’s in store for eBay’s future? The company projects 2015 revenue to fall between $18.6 billion and $19.1 billion. Forecasted adjusted earnings per share for the year are projected to be between $3.05 and $3.15.

eBay is also adding Wall Street executives Perry Traquina and Frank Yeary to its board along with Icahn’s Jonathan Christodoro. These additions bring the company’s board to 15, with 13 being independent directors.

PayPal also finished with an excellent year, contributing a fourth quarter revenue of $2.2 billion. This number is up 18% from last year. In the fourth quarter, PayPal’s payment volume was up 24%. It now has more than 162 million users, also up 13% from last year.

With the announcement of the PayPal spinoff and the company’s interest in the sale or IPO of eBay Enterprise, 2015 may be the year eBay splits into three companies.

eBay’s shares rose to $53.71 (up 33 cents) in aftermarket trading. Over the last 12 months, the stock lost 1.4 percent.

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