eBay - One mans trash is another mans rent payment
*sorry for the shit grammar. I havn't had much time to write, and edit. I barely had time to research, but im glad I did. There's so much more to this company, but thats for another day. (Teaser: eBay has 4 data centers in the US, processes 4 petabytes of data daily, entered a partnership with openAI, has special partnerships with UPS/FedEx/DHL).
P.s. here's a fun fact, even though eBay isn't available (technically) in China, they still account for ~12% of thier revenue. When you want a celebrities toe-nail clippings, I guess government censorship be damned.
The Bull Thesis for eBay
TLDR: Bigly economic instability (like robots stealing jobs from us fleshies), and global macros, paired with eBays strong performance in economic headwinds and smart strategies lean toward a favorable outlook, especially for Q3 2025 earnings this Wednesday.
You see that big spike on the chart above? That was the last period of insane unemployment (COVID). I mean.. Actually look at that chart. Let it sink in. 32k jobs where lost last month alone, over 3k this month, and even more upcoming layoffs announced (amzn replacing its fleshy workforce with robots for example).
The catalysts
Increase in buyers from
Job insecurity from corporate layoffs and federal furloughs, coupled with inflation on new goods, shrinks household budgets. This pushes consumers to hunt for value, increasing demand for cheaper, and or second-hand goods on eBay.
Increase in sellers from
The same economic pressures push people to supplement their income. This leads to people hawking their stuff on eBay. Unleashing a new wave of supply for the marketplace.
The Bonus
The first missing paycheck for furloughed federal workers could create an immediate need for cash, potentially boosting seller listings and activity right before the earnings announcement.
Ignoring the macros, eBay has been flawlessly executing a strategy that is already yielding damn good results.
Overall the company beat expectations last quarter, with both GMV and revenue growing 4%. Profitability looks amazing, with non-GAAP operating income up 8% and EPS up 16%. When I ask this magic 8 ball (that I bought on eBay) what the outlook is, it’s telling me “Super bullish.” It’s not hard to see why with 2025 GMV tracking to the high end of guidance and full-year EPS growth looking to be at 10-12%
Part of eBays strategy is to put in more effort toward the “focus categories” (collectibles, luxury, auto parts, etc.). These growth factors have grown over 10% outpacing the rest of the platform.
Let's look at the Partnerships & Acquisitions
ebay now allows U.S. customers to display their listings on Facebook market place, I’m not sure how much this has brought in as they lump this together with their “off-platform ads” section in their earnings, but we know it had to account for something because those off-platform ads grew 46% to $19 million in the quarter.
The Caramel acquisition is a longer-term play to create growth in eBays Motors sector. For those unfamiliar, the caramel acquisition means that you can now get a loan, register your vehicle, and ship it home - all without leaving eBay.
The Klarna partnership in the U.S is fast tracking growth, attracting Gen Z and Millennial buyers and resulting in 3x higher average order value on high value purchases.
The acquisition of Tise (EU fashion resale app), is helping eBay gain momentum in the "re-commerce" market (I actually hate that phrase..) targeting younger consumers.
The F1 sponsorship with the MoneyGram Haas team is a big brain marketing move to build brand awareness and affinity with a global, passionate, and incredibly affluent enthusiast audience, which aligning with their “focus category” (enthusiasts) strategy.
The Goldin Acquisition drove 10% of GMV alone for sales in pop-culture collectables. Specifically the trading cards category is unstoppable, growing for the 10th straight quarter.
Anyways, I'm bullish. I've opened a pretty large position for this upcoming earnings.
- ALSO big thanks to my subscribers on here, all eight of you! While I don't make any money from this, it's really nice to have an outlet where I can share.