Comment by OtherShrezzing
4 hours ago
>GME is ~12B, EBAY is ~46B (58 total) with net income of 0.4B and 2B (2.4 total). If he boosts profit by 1.2B then it's nearly a 50% increase and probably going to result in a more valuable combined company despite the debt.
GameStop had revenues of $3bn last year and eBay was $10-12bn, so combined it's $13-15bn. A net income increase of 1.2bn on that gross is a tall order for M&A efficiencies. Especially difficult when the two companies have essentially zero operational crossover, besides business admin. It doesn't seem likely to me that merging eBay's accounting/legal departments into GME's (and similar efficiency gains) is going to save anything close to a billion across the two entities.
I don't think this is a serious assessment. For years, the core business of both companies has been facilitating the flow of used goods. Gamestop has moved strongly into collectibles recently, with a partnership with collectible grading firm PSA and the introduction of (essentially) lucrative trading card lootboxes, whereas eBay has capitalized on the same expansion of the collectibles market with new live/flash auction features.
IIRC, Gamestop recently had a "trade-in anything" day, where they accepted a variety of products for store credit. Seems an awful lot like this was some sort of test for accepting products in-store for eBay listings, or something along those lines. They already accept trading cards to send off to PSA for grading and to place into their lootbox system.
As far as efficiencies go, you can see things like shifting shipping by individual sellers to mass shipping to/from a warehouse, a much heavier footprint in collectibles, and perhaps quality control that reduces buyer disputes (this one's a bit iffy).
Well let's be clear, the "trade-in anything" day was a fancy discount day. They gave everybody $5 for whatever they brought in, online you can read from employees that they just donated or threw it all away, no attempt to actually keep any of it to sell.
That said IMO the biggest difference in the two situations you're describing is that EBay is not in the business of buying the items to then sell later, they just facilitate transactions between two parties and some of the logistics (depending on the seller). They're similar as far as dealing with "used goods" but the actual design of the business and risk being taken on is very different.
EBay also not really lacking what you're describing - there are fufillment centers that can be used for EBay listings, there's the EBay "Authenticity Guarantee" program for cards, they already own TCGplayer which does all of this for trading cards way better than GameStop does, etc.
Perhaps somehow these things could be improved by GameStop but I can't imagine it being significantly better than it currently is.
Can you tell me where your local eBay fulfillment center is? I can tell you where my local Gamestop is (no, not that one, the other one).
They are wildly different businesses. Ebay is not in the business of holding physical goods, they are a marketplace that connects buys, sellers, and shippers and adjudicates fraud, collects funds, handles taxes, etc. They are not a warehouse.
Gatestop is a retail operation that buys and sells goods. It takes on all the liability for fake products, it puts capital on the line to purchase used goods, it is a totally different (and worse) business
That’s not correct. eBay owns TCGplayer which has large warehouses and does direct shipping & fulfilment sales (tcgdirect).