eBay Q3 2025 Earnings: Ad Revenue Soars Amid Rising Costs

eBay, a long-standing pillar of the e-commerce world, recently filed its quarterly report for the third quarter of 2025, offering a detailed look into its financial performance. For anyone interested in the health of online marketplaces and digital advertising, this 10-Q filing provides a wealth of information. Let's dive into the key numbers to understand how the company is navigating the current landscape.

Revenue Growth and Key Metrics

For the third quarter ended September 30, 2025, eBay reported net revenues of $2.82 billion, a solid 9% increase compared to the $2.58 billion from the same period last year. This growth was fueled by both its core marketplace activities and its burgeoning advertising business.

• Marketplace Revenues: The primary source of income, generated from fees for transactions on its platform, grew 6% year-over-year to $2.30 billion.
• Advertising Revenues: This segment was a standout performer, jumping 29% to $525 million. This reflects eBay's successful strategy of offering promotional tools to its sellers, turning its vast marketplace into valuable advertising real estate.

To better visualize how eBay's revenue streams flow through its expenses to arrive at its net income for the quarter, the following diagram breaks down the components of the income statement.

A critical metric for understanding any marketplace is Gross Merchandise Volume (GMV), which represents the total value of all goods sold on the platform. In Q3 2025, eBay's GMV reached $20.1 billion, a 10% increase from the prior year. This indicates that more business is being transacted on the platform, a positive sign of user engagement.

Another key metric is the "take rate," or the percentage of GMV that eBay captures as revenue. In this quarter, the take rate was 14.03%, a slight dip from 14.08% a year ago. While transaction volume is up, the company is keeping a slightly smaller piece of each sale on average.

The Cost of Doing Business

While revenue growth is strong, the company's expenses also climbed. Total operating expenses rose 13% to $1.42 billion. The most significant jump came from General and Administrative expenses, which surged 46% to $282 million. Product development costs also increased by 13%.

This rise in spending outpaced revenue growth, leading to a slight decline in income from operations, which came in at $576 million for the quarter, down from $595 million in Q3 2024. This highlights a key challenge for eBay: managing costs effectively to ensure top-line growth translates into bottom-line profitability.

Shareholder Returns Remain a Priority

A major part of eBay's financial strategy involves returning capital to its shareholders. The company demonstrated this commitment in Q3 by:

• Repurchasing $625 million of its own stock.
• Paying out $132 million in cash dividends.

For the first nine months of 2025, eBay has repurchased nearly $1.9 billion in stock and still has $1.4 billion remaining in its current buyback authorization. This signals confidence from management in the company's ability to generate consistent cash flow.

Final Thoughts

eBay's Q3 2025 performance paints a picture of a mature company finding new avenues for growth, particularly in advertising. The healthy increase in GMV suggests its marketplace remains relevant for millions of buyers and sellers. However, the pressure from rising operating expenses cannot be ignored, as it directly impacted operational profitability this quarter.

As eBay continues to compete in a crowded e-commerce field against giants like Amazon and a host of specialized platforms, its ability to innovate on its platform while controlling costs will be crucial. The company's focus on high-growth areas like advertising and its strong commitment to shareholder returns will be key factors for investors to watch moving forward.