Not many of you all have an understanding on how eBay’s PayPal segment makes money (sources of revenue, the fees (take rates) by segment, the impact of geographic mix, the impact of P2P on take rate, etc.). This issue will become increasingly important, as investors focus in on the potential impact of the proposed split of eBay and PayPal and the value and mechanics of the two businesses.
eBay’s Payments segment revenue can be split into 3 main categories – on eBay, Merchant Services (off eBay) and Person-to- Person (P2P). At a high level, it is estimated that eBay Transaction Volume of $61.1bn in CY14 and Transaction Rev at $3.1bn, with an avg. transaction fee of 5.1%. We estimate