Financial Analysis E-bay

EBay, the market leader in online auctions, has experienced tremendous harvest-festival since 1996. The following numbers from Exhibit 1 demonstrate eBays new-fangled produce: - The number of users rose from 41,000 in 1996 to 10,006,000 (525% yearly harvest-festival rate) - Merchandise sales emergenced from $7 trillion in 1996 to $2.8 million (637% annual offshoot rate) - The number of auctions jumped from 289,000 in 1996 to 129,560,000 (665% annual growth rate) The chart below focuses on the of the essence(p) proportions and figures used for completing a financial analysis for eBay.         1996         1997         1998         1999 lettuce Revenue Growth         N/A         29.1%         108.2%         160.9% Operating put on (as % of receipts)         20.0%         25.9%         14.8%         -5.2% Operatin g put down (as % of revenue)         58.7%         55.1%         66.5%         75.0% complete(a) sales and Marketing Expense (as % of revenue         41.0%         37.8%         41.8%         43.0% Marketing Expense/Customer (regular users)         $320         $45.80         $16.50         $9.59 Marketing Expense/list         $45.46         $3.55         $1.07         $0.74 relapse on Assets (Net Income as % of Assets)         N/A         125.6%         4.9%         1.1% Return on honor (Net Profit as % of Equity)         N/A         695.7%         7.2%         1.3% Current ratio         N/A         4.42         3.9 6         5.17 Debt to Asset Ra! tio         N/A         0.10         0.33         0.03 Debt to Equity Ratio         N/A         0.55         0.006         0.

006 funds and Cash Equivalents (000s)         N/A         3,723         37,285         219,679 Short-term investments (000s)         N/A         N/A         40,401         181,086 The financial statements of eBay in Exhibits 3 and 4 develop that revenue increased from $32,051,00 0 in 1996 to $224,724,000 in 1999, while unclutter income for the same period increased from $3,338,000 to $10,828,000. EBays revenue growth in 1999, from the previous year, had an astonishing increase of 160.9%. However, for the first clock time in the history of eBay, a disallow in operation(p) pelf occurred in 1999. After careful question of the ratios and figures, the negative operating profit can be in the main attributed to chop-chop rising operating expenses compared to revenues and the ever-increasing hyper-competition in the online auction industry. Sales and selling expenses have stayed constant compared to... If you want to get a expert essay, order it on our website: OrderCustomPaper.com

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