With another strong quarter under its belt, EBay Inc. plans to position its payment unit, made up of PayPal Inc. and Bill Me Later, as a global leader in online payments and to expand its presence across Asia, John Donahoe, eBay president and CEO, told analysts July 21 during a conference call to discuss second-quarter earnings.
PayPal in March announced a collaboration with China UnionPay Co. in which consumers in China may shop online and pay via PayPal (see story).
Additionally, PayPal launched on China’s Alibaba.com’s Ali Express platform, enabling small, global merchants the ability to pay for wholesale merchandise from China It also expanded its presence in Japan and Singapore and inked a deal with Malaysia’s MOL AccessPortal Bhd. to launch a prepaid card (see story).
PayPal also is tapping into mobile payment. Earlier this year, it launched a mobile application, which consumers have downloaded 2.5 million times, with 1 million downloads generated within the first three weeks of the launch, Donahoe noted during the conference call (see story).
Moreover, since January PayPal generated nearly twice as much mobile payment volume as it did for all of 2009, Donahoe said.
For the second quarter ended June 30, PayPal reported a record performance with net revenue of $817 million, up 22.1% from $669 million during the same period a year ago, and brought its active account total to 87.2 million, 15.6% increase from 75.4 million a year ago.
PayPal’s net total payments volume increased 28.1%, to $21.4 billion from $16.7 billion, with Bill Me Later staying consistent since last year and accounting for 1% of the unit’s total payment volume.
Bill Me Later enables consumers to pay for purchases without using a credit card at participating merchants. To use the service, consumers set up an account via the Bill Me Later website and provide their birthday along with the last four digits of their Social Security number when checking out. Consumers then receive a bill from the merchant at a later date and are asked to pay within a specific time period designated by the merchant.
PayPal’s merchant services net total payment volume was $13.1 billion, up 43.9% from $9.1 billion. The unit includes PayPal-accepting merchants, active PayPal accounts and eBay’s share of Mobile Express Checkout, an initiative that enables consumers to pay for purchases using their mobile phones. Mobile Express Checkout offers consumers the same payment options as the online version of PayPal.
As a company, eBay reported net revenue of $2.2 billion, up 4.8% from $2.1 billion a year ago. The San Jose, Calif.-based company generated net income of $412 million, up 26% from $327 million.
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