$EBAY - eBay to Cut 2,400 Jobs and Explore Sale or IPO of Enterprise Unit
EBay said today that it would cut about seven percent of its workforce globally in the first quarter as it looks to reduce costs ahead of its planned spinoff of PayPal. The company also said it would explore a sale or IPO for its eBay Enterprise unit, which provides online and brick and mortar retailers with software tools and warehousing and logistics services.
The job cuts are expected to affect 2,400 positions across all divisions of the company, including PayPal, the company said. eBay’s stock was trading up nearly 4 percent in after-hours trading.
The news overshadowed eBay’s fourth-quarter results, which were basically in line with analyst expectations. But the company released disappointing guidance for the current quarter. EBay said it was expecting first-quarter revenue to be in the range of $4.4 billion, compared with analyst estimates of the range to have a midpoint of $4.74 billion.
eBay also announced a deal with eBay shareholder Carl Icahn to name Icahn crony Jonathan Christodoro to eBay’s board. The so-called “standstill agreement” was reached to keep Icahn from agitating for a bigger stake or a hostile takeover of the company. Upon eBay’s split with PayPal — which Icahn had pushed for and which is expected to happen later this year — Icahn can determine whether Christodoro will remain on eBay’s board or take a seat on PayPal’s instead. If it wasn’t already clear, Icahn won this fight.