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EBay Inc (NASDAQ:EBAY) reported net revenue of $3.75B (+14% Y/Y), hitting the high end of guidance ($3.65- $3.75B) but coming short of consensus ests at $3.77B. Adjusted EBITDA came in at $1.25B vs. consensus at $1.24B while non-GAAP EPS of $0.63 beat Street expectations of $0.62 and guidance of $0.60-$0.62.

EBay Inc (NASDAQ:EBAY) Rev./adj. EPS at $3.75bn/$0.63 was below/above the Street at $3.77bn/$0.62 with organic rev. growth at 15% y/y vs. 19% in 4Q (Leap Year and Easter may have hurt 100-200bps). U.S. GMV growth was 16% y/y above Street at 14.5%, and Intl. ex-currency GMV was 11% y/y. PayPal rev. of $1.54bn was below $1.58bn est. with a 3.77% take (FX hedge impact). Non-GAAP margins were 27.4%.

User growth up but units growth decelerated

Marketplace user growth improved to 13% y/y vs. 12% in 4Q, while units sold growth on eBay decelerated to 11% y/y vs. 17% y/y in 4Q (less units per user). Marketplace margins were up 340bps y/y to 42.1%, with eBay seemingly less aggressive on Marketplace marketing in the Q. PayPal active accounts increased by 16% y/y up from 15% in 4Q. PayPal operating margins at 24.1% were up from 23.0% in 4Q’12 but down from 26.1% in 1Q’12, with margin decline attributed to consumer marketing and product investments.

Expect lower 2Q, and limited change to Street ’13 revs/EPS

eBay Inc (NASDAQ:EBAY) provided 2Q rev/EPS (midpt.) at $3.85bn/$0.62 vs. Street at $3.95bn/$0.66 and left 2013 rev./EPS guidance at $16.25bn/$2.72 vs. $16.38bn/$2.76. eBay’s 2013 outlook suggests 2Q could be the low-water mark for growth in the year with 14% revenue and 11% EPS growth. Analysts expect 2Q Street EPS estimates to decline by ~5% and 2013 estimates to be flat to possibly down 1%.

Modestly negative eCommerce read-across

eBay Inc (NASDAQ:EBAY)’s key eCommerce metrics decelerated (consistent with comScore data for Feb), with US ex-vehicle GMV growth up 16% in 1Q vs. 19% in 4Q, Intl GMV up 11% vs. 14%, and FX-neutral Merchant Services TPV up 26% vs. 28%. eBay suggested that eCommerce activity was strong in the US, but the UK was weaker and eBay’s 2Q guidance suggests further macro/currency pressure.

Guidance

eBay Inc (NASDAQ:EBAY) reiterated full-year guidance but its 2Q13 guidance came in below Street expectations. For 2Q13, management expects net revenue of $3.80-$3.90B, non-GAAP EPS of $0.61-$0.63 and GAAP EPS of $0.46-$0.48 vs. consensus at $3.95B, $0.66 and $0.53, respectively. For FY13, management reiterated net revenue of $16.00-$16.50B, non-GAAP EPS of $2.70-$2.75 and GAAP EPS of $2.23-$2.29 vs. consensus at $16.38B, $2.76 and $2.23, respectively.