Ebay deep in red after Skype write off

Ebay has posted its third quarter 2007 financial results yesterday and as expected, it has reported an operating loss of USD 938 million due mainly to the massive Skype write-off it agreed to two weeks ago.

This represented half of its revenues for the quarter. Skype has now 246 million registered users and if the growth rate remains constant, Skype will reach the 400 millionth user by mid 2008.

Skype's big issue though remains revenue generation and profits; each Skype users brings in less than £1 annually as the vast majority of calls are free and only around a third of registered users use Skype regularly.

Elsewhere, the news were better. Ebay's core buysiness, auctions, saw a surge in revenues as they gained 26% to USD 1.32 bn, while Paypal, its online payment business, grew to USD 470m as its bid to attract online businesses prove successful.

Ebay's share prices responded positively as the shares reached USD 41.