In Q4, eBay generated a staggering $394 million through promoted ads, the program is projected to hit a monumental $1 billion by 2024.

For eBay sellers, navigating the platform’s array of advertising options like Promoted Listings Standard, Promoted Listings Advanced, Offsite Ads, and Promoted Display raises concerns about dwindling profits. With eBay’s aggressive advertising tactics, will sellers see any returns?

According to eBay’s 2023 financial report, the company raked in $368 million in revenue from first-party advertising products alone, marking a 33% increase. Total advertising revenue for the quarter amounted to $393 million, constituting 2.1% of GMV.

As eBay anticipates an additional $1 billion in ad revenue and $18,250,000,000 in a per-order fee hike, shareholders anticipate a prosperous 2024.

However, the looming question remains: what about the sellers who consistently bear the brunt of these practices year after year?

Here’s a few highlights from eBay’s 2023 financial report:

Fourth Quarter Financial Highlights

• Revenue was $2.6 billion, up 2% on an as-reported basis and up 3% on a foreign exchange (FX) neutral basis.
• Gross Merchandise Volume (GMV) was $18.6 billion, up 2% on an as-reported basis and nearly flat on an FX-Neutral basis.
• GAAP net income from continuing operations was $728 million, or $1.40 per diluted share.
• Non-GAAP net income from continuing operations was $560 million, or $1.07 per diluted share.
• GAAP and Non-GAAP operating margin was 16.0% and 26.7%, respectively.
• Generated $123 million of operating cash flow and reported $(3) million of free cash flow.
• Returned $379 million to shareholders, including $250 million of share repurchases and $129 million paid in cash dividends.

Full Year Financial Highlights

• Revenue was $10.1 billion, up 3% on an as-reported basis and up 4% on an FX-Neutral basis.
• GMV was $73.2 billion, down 1% on an as-reported and FX-Neutral basis.
• GAAP net income from continuing operations was $2.8 billion, or $5.21 per diluted share.
• Non-GAAP net income from continuing operations was $2.3 billion, or $4.24 per diluted share.
• GAAP and Non-GAAP operating margin was 19.2% and 27.4%, respectively.
• Generated $2.4 billion of operating cash flow and $2.0 billion of free cash flow.
• Returned $1.9 billion to shareholders, including $1.4 billion of share repurchases and $528 million paid in cash dividends.

Business Highlights

Revenue Initiatives

• eBay’s first-party advertising products delivered $368 million of revenue in the fourth quarter, up 33% on an as-reported basis and up 30% on an FX-Neutral basis.
• The company’s total advertising offerings generated $393 million of revenue in the fourth quarter, representing 2.1% of GMV.

Source for this article include:

eBay