Ebay Beats Forecasts On Strong Growth From Marketplaces, Q2 Revenue Up 23 Percent To $3.4B

eBay has just released its second quarter 2012 earnings report, in which the eCommerce giant outpaced expectations for yet another quarter. Revenue increased 23% to $3.4 billion, compared to the same period of 2011. Non-GAAP earnings came in at $0.56 per diluted share, while eBay posted Q2 net income of $692 million — up from $283 million in Q2 2011. In terms of benchmarks, analysts had been expecting earnings of $0.55 per share on revenue of $3.36 billion.

For reference, we can compare this to Q2 2011, when (excluding one-time items) eBay earned 48 cents per share with revenue posted at $2.76 billion — both of which were, at the time, above estimates. Now, as it was then, eBay continues to operate as one of the largest eCommerce companies in the world, so many look to the health of its principal businesses as an indicator of how eCommerce is faring overall. And although the economic pains over the last few years have wreaked havoc on traditional retailers and brick and mortars, it seems that eBay and online commerce seem to be more than weathering the storm.

"We delivered a great second quarter, driven by eBay Marketplaces' best performance in years, strong growth at PayPal and strong same-store-sales growth for GSI's large retail customers," said eBay President and CEO John Donahoe. "Our entire company is strong, but we're particularly pleased with eBay Marketplaces, which delivered its strongest organic growth in gross merchandise volume, excluding vehicles, since 2006. And mobile continues to be a game changer. We now expect eBay and PayPal mobile to each transact $10 billion in volume in 2012 — that's more than double 2011, a staggering surge in mobile shopping and payments on devices that did not exist just a few years ago. Retail is at an inflection point, and we are helping to reshape how people around the world shop and pay."

Analysts were also looking to PayPal, which had an extremely active first quarter (with numerous additions to its product set) and ended Q1 with 109.8 million active registered accounts for signs of growth. PayPal didn't disappoint, with registered users jumping to 113.2 million in Q2.

The company has been moving to take its payment solution beyond the Web, bringing it to local merchants in brick-and-mortar stores and to mobile devices with its recently-launched Square competitor. PayPal's revenue increased 26% year, and the platform's net total payment volume grew 20% year over year to $34.5 billion. (This report follows, by the way, PayPal's acquisition of Card.io yesterday.)

But the biggest contributor to the company's continued growth in the second quarter came from Marketplaces, which saw the strongest "organic growth rate in gross merchandise volume, excluding vehicles, since 2006," eBay said in a statement. GMV grew at a 15 percent year-over-year basis (excluding the effects of foreign currency), while international GMV increased 15 percent to $16 billion. In all, Marketplaces revenue grew 9 percent year-over-year to $1.8 billion in the second quarter of 2012. Meanwhile, sold items increased 20 percent in the second quarter, a 2.5 percentage point acceleration, which the company said reflected "a better customer experience and improved selection."

Also of note: eBay's suite of mobile apps surpassed 90 million downloads globally since it launched mobile in Q3 2008 — up from 78 million global downloads in Q1. As Donahoe mentioned, the company is now expecting both eBay and PayPal mobile to generate $10 billion in mobile transacted volume in 2012, which, for those keeping track at home, is more than double what it saw in 2011.

The company's GSI business, which was acquired in the second quarter of 2011, saw $221 million in revenue for the quarter and generated $674 million in global eCommerce (GeC) merchandise sales, a slight drop from $237 million in revenue and $715 million in global sales in the first quarter. However, same store sales grew 21% year-over-year (compared to 26 percent year-over-year growth in Q1), which is an indication of strong eCommerce sales from the company's retail clients.

As for looking forward, eBay is expecting more of the same, maintaining the guidance it set forth in April. The company forecasted net revenues in the range of $3.3 to $3.4 billion in the third quarter, with non-GAAP earnings per diluted share expected in the range of $0.53 to $0.55. In turn, it held firm on guidance for the year, expecting revenues in the range of $13.8 to $14.1 billion with GAAP earnings per diluted share in the range of $1.91 to $1.96 and non-GAAP earnings per diluted share to be between $2.30 and $2.35 — exactly on par with guidance at the end of Q1.

Remember, too, that eBay posted a solid first quarter, in which it was remarkably active, especially when it came to PayPal. The company put a good deal of resources into ramping up payment options for large and small merchants, debuting an in-store payments platform for large retailers; PayPal Here, a card swiper that attaches to a mobile phone for small businesses, with hints at a brand new PayPal wallet.

And, of course, there were a number of leadership changes at the e-commerce company in Q1. After former president Scott Thompson departed for the CEO role at Yahoo, PayPal named David Marcus, the former CEO and founder of mobile payments startup Zong and PayPal Mobile VP, as President (PayPal acquired Zong last year for $240 million).

X.commerce CTO Neal Sample also left eBay to join American Express, while PayPal product VP Sam Shrauger left for Yahoo and Alyssa Cutright took off for Square.

Q2 earnings highlights below: