Skype acquisition main reason
Last modified on Thursday, 18 October 2007 15:02
eBay, the world’s largest online auctioneer and online payment business, reported a net loss for its Q3 of $936 million, compared with a profit of $281 million for this same period last year. eBay indicated that the net loss was due to a $1.39 billion write down of its purchased of Web-based mobile phone service, Skype. Apart from the write-down, eBay’s adjusted profit was $564 million.
eBay’s core business of online auctions, fixed price sales and PayPal transactions increased 26 percent over last year. Strong international performance was posted, particularly in Germany. eBay business StubHub, a sports and entertainment ticket reselling site also had a key role, as did advertising business that eBay has with Yahoo in the U.S. and Google in Europe.
For its 2007 yearly performance eBay indicated that it expected its earnings per share to range significantly above what analysts were expecting. eBay had indicated earlier that it would drop up to $1.2 billion off the total price of $4.3 billion it had agreed to pay Skype and would re-sign some Skype executives as part of the deal, since Skype has not met the financial goals that were anticipated when the sale to eBay took place nearly two years ago.