eBay to cut 2,400 jobs and sell enterprise business ahead of PayPal spin-off

E-commerce major eBay is slashing 2,400 jobs and planning to sell its enterprise business to become leaner, as it prepares for the spin-off of its payment processing unit PayPal into a separate company.

"As we look to 2015, we are taking decisive actions to address both the opportunities we see and the challenges we face. To that end, we're streamlining our cost structure and portfolio as we set up eBay and PayPal to succeed as independent, public companies," CEO John Donahoe said in a statement.

"We plan to reduce our workforce globally by approximately 2,400 positions, which represents about seven percent of our global workforce, across eBay Marketplaces, PayPal, and eBay Enterprise."

The company noted that the decision to cut jobs was a difficult one, but added that it is necessary to "reduce complexity and create more competitive cost structures".

Donahoe said eBay will also be exploring strategic options for eBay Enterprise including a sale or IPO. The unit, which develops online shopping sites for retailers, has increasingly divergent opportunities and limited synergies with eBay, according to him.

Separation of the enterprise business would help both businesses focus on their respective priorities moving forward, he added.

The company once again confirmed its commitment to spin off the PayPal division. It entered into a standstill agreement with Carl Icahn, who owns about an 8% stake in the company, so that the activist investor may appoint an executive from his firm to eBay's board.

For the fourth quarter, eBay reported a 9% increase in revenues to $4.9bn (£3.2bn, €4.2bn) from last year. Its net income for the quarter rose by 4% to $1.1bn on an adjusted basis.