EBay is considering making thousands of layoffs early next year according to the Wall Street Journal and experts are tipping the cuts could be a much as 10 per cent of the company’s total workforce – around 3000 jobs.
EBay is preparing to split off its PayPal payments unit and the layoffs are likely to occur in eBay’s core Marketplaces division.
EBay’s spending has been exceeding revenue growth in recent quarters and this is the reason behind the proposed cuts.
There are currently 33,500 employees at eBay and they are just about evenly split between PayPal and eBay’s Marketplaces division. Industry watchers say Marketplaces still generates more revenue but PayPal has been growing much faster.
Since eBay’s acquisition of PayPal back in 2001, it has grown at an impressive pace and has not been showing signs of stopping. Industry experts report that PayPal has acted on the right initiatives at the
right time, and positioned itself to capitalise on the upcoming opportunities in the market.
At the end of September this year, eBay’s management announced it would operate eBay’s business and PayPal business segments separately. Stock market watchers say that splitting off PayPal from eBay will be good for PayPal.
Over the years, PayPal has gained significant market share. The company has approximately 152 million registered accounts, strong ties with 15,000 financial institutions, and provides a localised payment experience by accepting payments in 26 different currencies.
PayPal is used in 203 countries and has set itself up as the most trusted digital payment service on the back of its mass merchant acceptance, higher security and speedy completion of transactions via just a
few clicks.
