BREAKING: eBay Inc. Announces Plan for 2010 IPO of Skype

Richard Brewer-Hay

eBay Inc.  has announced that it plans to separate Skype from the company, beginning with an initial public offering that is intended to be completed in the first half of 2010.


“Skype is a great stand-alone business with strong fundamentals and accelerating momentum,” said John Donahoe, eBay Inc.’s President and CEO. “But it’s clear that Skype has limited synergies with eBay and PayPal. We believe operating Skype as a stand-alone publicly traded company is the best path for maximizing its potential. This will give Skype the focus and resources required to continue its growth and effectively compete in online voice and video communications. In addition, separating Skype will allow eBay to focus entirely on our two core growth engines—ecommerce and online payments—and deliver long-term value to our stockholders.”

According to the press release, the decision to separate Skype is based on a timeline outlined by Donahoe when he became eBay’s CEO in April 2008. At the time, the company said it would spend a year evaluating Skype and its potential synergies within the eBay Inc. portfolio before making any decisions about Skype’s future.

Skype generated revenues of $551 million last year, a 44% increase from 2007. Registered users reached 405 million by the end of 2008, a 47% increase from the year before. The company recently announced that it expects Skype to top $1 billion in revenue in 2011, nearly doubling 2008 revenues.

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