EBay confirmed it will be laying off about 7 percent of its workforce, or about 2,400 employees, in the next couple of months as it prepares to separate from PayPal.
The San Jose-based e-commerce and payments giant also said it may consider a sale or IPO for its Enterprise group, which has been developing third-party technology for other retailers, like Nordstrom, Toys “R” Us and World Market.
Today, eBay reported disappointing fourth-quarter results, including profits of $936 million, or 75 cents a share, on revenues of $4.9 billion. “Significant events in 2014 disrupted our ecosystem and impacted performance,” said Ebay’s CEO John Donahoe during the company’s fourth-quarter conference call.
In after hours trading, eBay’s shares were up 2.4 percent, or $1.28, to trade at $54.66 a share.
The layoffs are expected to take place in the first quarter, and impact all three of the company’s divisions: eBay Marketplaces, PayPal, and eBay Enterprise. In response to questions asked by GeekWire, a spokeswoman said the cuts are not specific to a geographic region or business unit. The cuts will also include current job openings.
In August, eBay announced plans to aggressively hire in Portland, pushing its employee base there beyond 200. EBay also operates a substantial tech hub in the Seattle area, with 150 employees at last count.
Despite the challenges eBay is facing, Donahoe said plans to split the company in two remains on schedule: “Our plans are on track to separate EBay and PayPal into independent companies in the second half of 2015, and we are confident this is the right strategic path for each business,” he said, in a statement.
In addition to spinning off PayPal, it will also be exploring options for eBay Enterprise, including a sale or IPO.
The eBay Enterprise unit reported gross merchandise sales $443 million, up 9 percent in the quarter. It claimed to help its clients increase same-store sales by 12 percent, and that it signed up more than 1,000 new clients and renewed or extended its relationship with more than 1,700 additional clients in 2014.
Among its offerings, it helps retailers ship merchandise from stores to customers, and in November, Nordstrom rolled out futuristic fitting room technology with the help of the unit.
“Enterprise is a strong business and a leading partner for large retailers, managing mission critical components of their e-commerce initiatives. However, it has become clear that it has limited synergies with either business and a separation will allow both to focus exclusively on their core markets, as we create two independent world class companies,” it said.
Additionally, the company said it entered into a standstill agreement with activist investor Carl Icahn, who had pushed the company to split up.
Here’s a detailed look at its financial results in Q4:
