Monday, October 6th, 2008
eBay Reduces Workforce by 10%
In addition to announcing the acquisition of U.S.-based online payments business Bill Me Later and of Denmark’s leading online classifieds site dba.dk and vehicles site bilbasen.dk, eBay today also announced plans to reduce its global workforce by approximately 10 percent, affecting about 1,000 employees in addition to several hundred temporary workers and the reduction of open positions.
The reduction is expected to result in pretax restructuring charges of approximately $70 million to $80 million, with the charges predominantly recorded in the fourth quarter of 2008. According to the press release, “the global reduction is intended to simplify and streamline eBay’s organization, improve the company’s cost structure and strengthen the overall competitiveness of the company’s existing businesses.”
“We are making aggressive moves to strengthen our leadership positions in e-commerce and payments to competitively position our company for long-term growth,” said John Donahoe, eBay Inc.’s president and chief executive officer. “Bill Me Later is a natural addition to our portfolio, a company that belongs with PayPal. Together, PayPal and Bill Me Later will make online payments safer, easier and more convenient than ever.”
“Our classifieds acquisition gives us another market leadership position in Europe for this rapidly growing part of our portfolio,” Donahoe said. “We are the global leader in classifieds with top positions in Canada, Australia, Germany, Japan and the United Kingdom, and sites in more than 1,000 cities across 20 countries. The acquisition of dba.dk and bilbasen.dk gives us technology and expertise we can leverage across our classifieds portfolio to create better customer experiences.”
Commenting on the company’s workforce reduction, Donahoe said: “While never an easy decision to make, these reductions will help improve our operations and strengthen our ability to continue investing in growth.”
The company also stated it expects to hit the low end of its Q3 2008 revenue guidance and exceed GAAP and non-GAAP earnings per share guidance as issued in conjunction with its second quarter earnings release on July 16. eBay is scheduled to announce third quarter results on October 15.
You can find out more when eBay hosts an investor conference call at 5:30am PT this morning at http://investor.ebay.com. The call will be archived at the same address.
For more information regarding this news and to access additional presentations and documents related to all of today’s announcements, please visit http://ebayinkblog.com/news.
- RBH
Tagged: business, ebay, ebay inc, ebay.com, workforce reduction
KPAOn 10.06.2008 at 5:32 am Said:
How sad to see people lose their jobs, especially right now with the economy on shaky ground. My heart goes out to those folks who are reaping the repercussions of change in that company.
I hope this isn’t another ill conceived change by Donahoe to put lipstick on the pig he calls site improvements. Is it just me that sees a decline since he took the helm or am I missing something in the big picture that has actually improved eBay.com over the last 9 months?
Ed (BuildaSkill)On 10.06.2008 at 7:17 am Said:
Quote of the year -
“We are making aggressive moves to strengthen our leadership positions in e-commerce and payments”
which will be why 10% of the staff are being laid off immediately after appointing another two board room members?
Yup, fewer indians, more chiefs = a swing in the strength of the leadership.
Hohum, keep going like this and it’ll be the chiefs who have to man the front line support positions, because there’ll more chiefs than indians, and the indians will be too busy with real work to take care of the customers… Oh forgot, Griff’s been doing that for years anyway.
… and where was the stock price today?
Ed
Joyce Tudor-HughesOn 10.06.2008 at 8:33 am Said:
“While never an easy decision to make, these reductions will help improve our operations and strengthen our ability to continue investing in growth.”
Your words - ‘improving efficiency’ and ‘investing in growth’ are euphemisms and PC for laying off staff.
Big BillOn 10.06.2008 at 8:52 am Said:
Unfortunate. Now some of those employees know what it’s like for the tens of thousands sellers who have had to leave eBay due to the ridiculous changes, fees and horrible insecurity about being forced to use Paypal. Hopefully Grif was the first to go this morning.
1939noelOn 10.06.2008 at 10:00 am Said:
Where have we heard this before - Ebay is on the slippery slope.
tammyOn 10.06.2008 at 10:32 am Said:
If you think Paypal fees are expensive try selling something at an auction house and then paying anything between 15% and 25% overall charges, AND THEN having to wait between four to six weeks for your cheque,which takes another week to clear.
AND the same charges apply for BUYING through an auction house
URKLESPANOn 10.06.2008 at 10:51 am Said:
There does seem to be a tendency to change the ebay site for no good reason on a frequent basis.
Perhaps they actually do have too many coders and web site designers and nothing for them to do?
Fed Up BobOn 10.06.2008 at 11:07 am Said:
It’s a crying shame that it’s not the arrogant management being laid off.
The top floor phrase “grossly ineffectual” just about sums them up.
There can’t be many companies world wide that abuse their customers and still wonder where it’s going wrong.
KevinOn 10.06.2008 at 11:20 am Said:
Why didn’t eBay lend the US government $700 billion dollars? Or run a special auction to win the debt?
It would have so much easier for everyone. Then they could announce they’d bought the entire USA because it fitted their business plan.
eBay are certainly acquisitive - but any company, however big , is not above being taken over themselves.
But they’re certainly eating the competion alive at the moment…..
Lastly, what on earth does inward facing staff mean? Do they sit with their backs to the window?
anjaahli khamalOn 10.06.2008 at 11:23 am Said:
Buyers don’t use ebay because it is full of counterfeit, and sellers don’t use ebay because ebay forces them off with unrealistic DSR targets. Then this is what happens, ebay business starts to fail.
Keith EOn 10.06.2008 at 11:48 am Said:
I feel for those people who are being made redundant, especially as it’s only just under 3 months till Christmas.
I am not surprised eBay is in trouble.
It just isn’t fun being on here anymore.
This was once a great website, it was an enjoyable experience selling and buying on here. Since 2008 rolled in, eBay has turned it into the most unpleasant dictatorial trading venue on earth.
God bless all those workers being sacked, I hope you find new jobs soon. Hopefully someone who has worked in eBay could use their knowledge to give them some decent competition one day.
This might reduce their arrogance
lebenningtonOn 10.06.2008 at 12:21 pm Said:
Cheers,
Richard, I think concerning the layoff news your article was based on today, that ‘Cheers’ was the wrong sign-off to use. Also, there are also some media sites that are saying 1600 people were laid off and not 1000. Which is it?
CNBC just called Ebay the biggest loser of the day. Cheers!
Pondering ...On 10.06.2008 at 12:40 pm Said:
It’s high time for Ebay shed a lot more than 10% of the people who sit on their backsides and do nothing yet take home a very fat salary i.e the management.
SHEMMYBOYOn 10.06.2008 at 12:41 pm Said:
SAD!!!! FOR THE PEOPLE WHO ARE LOSING THEIR JOBS BUT HAVE YOU NOTICED LATELY THE NUMBER OF SELLERS/BUYERS. IS IT ANY WONDER WHEN EBAY CHARGES 0.40P FOR LISTING FEE AND THEN TAKE 9.9% WHEN YOU SELL YOUR ITEM - OR BUY A SHOP AT STUPID PRICES!!!!
coppersharksOn 10.06.2008 at 1:56 pm Said:
I think eBay has been going downhill for a while. I don’t sell anymore as charges are prohibitive particularly if you use paypal. Security is another issue!
Buying is no better as seller have to inflate prices to cover fees. It’s certainly lost its appeal for me
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