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Ebay’s PayPal Bet Pays Off

Monday, 14 Feb 2011 | 5:27 PM ET

Back in 2002, eBay confounded the Street with its decision to buy PayPal.

But almost 10 years later that $1.5 billion acquisition may end up being one of the smartest things the company has ever done.

Although eBay’s auction business has matured, PayPal continues to grow by leaps and bounds with revenues expected to double by 2013.

Looking at the numbers, PayPal president Scott Thompson says the unit had revenues of $3.4 billion in 2010—an increase of 23 percent of 2009—and the company expects those revenues to reach $6 to $7 billion by 2013.

By comparison, eBay’s marketplace earned $5.7 billion in 2010, and eBay expects that to grow to $7 to $8 billion by 2013.

If all those numbers make you dizzy, here’s another way of saying it. PayPal could equal or even surpass the online marketplace as the company’s biggest business unit in 3- 5 years.

What else must you know about PayPal before you place bets on eBay? Find out from PayPal President Scott Thompson.

Watch the video now!

eBay's Best Pal: PayPal
Discussing eBay's partnership with PayPal and the payment processor's revenue forecast, with Scott Thompson, PayPal president.




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Trader disclosure: On Feb 14, 2011, the following stocks and commodities mentioned or intended to be mentioned on CNBC’s "Fast Money" were owned by the "Fast Money" traders; Seymour Owns (AAPL); Seymour Owns (BAC); Seymour Owns (F); Seymour Owns (FXI); Seymour Owns (GE); Seymour Owns (POT); Seymour Owns (TSO); Seymour Owns (NOK) Call; Finerman's Firm Is Short (IWM); Finerman's Firm Is Short (SPY); Finerman's Firm Is Short (MDY); Finerman's Firm Is Long S&P Puts; Finerman's Firm Is Long Russell 2000 Puts; Finerman's Firm And Finerman Own (AAPL); Finerman's Firm Owns (BAC) Leap, Finerman Owns (BAC); Finerman's Firm Owns (BBY); Finerman's Firm And Finerman Own (BP); Finerman Owns (C); Finerman Owns (GOOG); Finerman's Firm And Finerman Own (HPQ); Finerman's Firm Owns (IBM); Finerman's Firm Owns (JPM), (JPM) Leap; Finerman Owns (JPM); Finerman's Firm Owns (M); Finerman's Firm Owns (MCD); Finerman's Firm And Finerman Own (MSFT); Finerman's Firm Owns (PLCE), (PLCE) Options; Finerman's Firm Owns (TGT); Finerman's Firm Owns (WMT); Finerman's Firm Owns (EBAY); Najarian Owns (BAC) Call Spread; Najarian Owns (C); Najarian Owns (DOW) Calls; Najarian Owns (F) Bonds, Calls; Najarian Owns (GE); Najarian Owns (GM); Najarian Owns (JPM) Call Spread; Najarian Owns (MS); Najarian Owns (PFE); Najarian Owns (YHOO); Najarian Owns (CLF) Call Spread; Terranova Owns (VRTS); Terranova Owns (C); Terranova Owns (PEP); Terranova Owns (UPL); Terranova Owns (GM); Terranova Owns (APA); Terranova Owns (CVI); Terranova Owns (SU); Terranova Owns (CNQ)

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