PayPal dominates the online payment market, and it
grew a hefty 29% over the holiday quarter, besting analysts' expectations by a half-billion dollars. PayPal's full-year growth was even higher, at 31%. Accordingly, eBay shares skyrocketed 13%.
Over at eBay proper, more product listings translated into higher actual sales. This, in part, came from eBay's decision to raise its fees to roughly 6%, which in turn encouraged
merchants to sell more higher-quality items, improving conversion rates.
Sales were also buoyed by a consumer-electronics sector rejuvenated by the entrance of the Nintendo Wii and the Sony PS3; incredible demand for these hard-to-find items lead to astonishing sales markups of 200% to 300%.