Ebay restructures regional leadership, confirms layoffs of 2-3% of global workforce
E-commerce marketplace eBay has been rethinking its operations in a bid to bring the company back to growth amid strong competition from the likes of Amazon and a plethora of other online marketplaces. Today came the latest chapter in that development. The company announced that it would be reorganizing its business units, and specifically consolidating its geographical regions into a single team, to be led by Jay Lee, as SVP and GM for markets. As part of that, TechCrunch understands that the company will be laying off between two and three percent of its global workforce.
According to eBay, the company currently employs 14,100 people, so that would work out to cuts of between 282 and 423 people. (At least one source on Twitter seems to have a more specific number.)
The company said all geographic regions will be reporting to Lee. These include Americas, APAC, UK, Central and Southern Europe, and well as Cross-Border Trade. Also as part of the restructure, Scott Cutler, who had been SVP of the Americas for the company and before that the president of StubHub, will be leaving the company. Lee will oversee that role as well in the interim until a new head of the Americas is appointed.
The company has been under a lot of heat from activist investors such as Elliott and Starboard, who believe the company needs to be shaken up and reorganised to return to growth. (Indeed, in its last quarterly earnings, the company performed well in terms of analysts’ expectations for revenue and earnings per share, but it only saw gross merchandise value go up by one percent, pointing to very sluggish growth.) Earlier this year, Elliott published an open letter calling for eBay to overhaul its main Marketplace, refresh management and rethink its other businesses like StubHub and classifieds.
Ebay, naturally, would say that it’s not responding directly to those activist investors by making this change — even if it happens to be one of the moves that was requested. Instead, in a statement announcing the management shifts (but not the layoffs… we confirmed those ourselves), it highlights that this will give it “strategic alignment of global priorities (buyer growth, conversion, payments, advertising) across the company’s largest markets; faster decision making and execution; streamlined resource allocation with a greater impact on global priorities; and improved and simplified collaboration with the Core Product and Technology (CPT) organization, led by CTO Steve Fisher.”
Lee is a longtime veteran of the company, having been with eBay since 2002 leading APAC, and then EMEA. There will always be a debate in business about whether veterans, who “knew the company when it was in better shape”, are the best to restructure it, or if fresh talent and a fresh pair of eyes are what is best. (There have been examples in favor of both.) eBay may not be what it once was, but there is still a huge and profitable business there, and given that e-commerce is only going one way — up — that means the opportunity for eBay to come back is still there.
We’ll update this post as we learn more.