Jason Del Rey

Recent Posts by Jason Del Rey

eBay’s Third-Quarter Earnings May Shed Light on New Cassini Search Engine

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When eBay reports its third-quarter earnings after market close today, growth in its auction business may play a bigger role than it has in the past, according to data compiled by ChannelAdvisor, a publicly-traded company that helps product sellers distribute their goods to different marketplaces and e-commerce sites.

Same-store sales completed on eBay in an auction format rose in the last two months of the quarter after several months of decreases, ChannelAdvisor reports. The main cause? EBay’s new search engine dubbed Cassini, ChannelAdvisor CEO Scot Wingo believes.

“Usually in an environment where conversion rates are steady — if we saw a bump in one format (e.g. fixed price) then the other would have a corresponding decrease,” he wrote in an email to AllThingsD. “The fact we didn’t really see that (auctions up, fixed price up) indicates to us that conversion rates must have gone up — that there was something incremental going on and when we dig into the data, nothing has changed that we can see but Cassini.”

When eBay was predominately an auction website, there wasn’t really a need for an advanced search engine. Most eBay visitors simply browsed auctions by category or looked at those that were nearing completion, eBay CTO Mark Carges said in an interview earlier this year.

But as eBay has shifted hard into full-price commerce as the popularity of auctions waned — well more than half of eBay’s listings are now sold full-price — it overhauled its search engine.

A rise in same-store sales through auctions on eBay that isn’t accompanied by a decrease in growth of full-price same-store sales may mean that the new search engine is doing a better job at surfacing the right auctions than it has in the past.

Overall, analysts are expecting eBay to record adjusted earnings per share of 63 cents on revenue of around $3.9 billion.

A couple more topics to pay attention to:

Revenue from eBay’s international business totaled 52 percent of eBay’s overall revenue in the second quarter, but the company warned that macroeconomic trends in Europe and Korea could have a negative impact on the business through the remainder of 2013.

We’ll also look for some more color on the company’s agreement to acquire Braintree for $800 million in cash — a deal that is expected to go through in the fourth quarter.


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