eBay Is Cutting Jobs Despite Its Turnaround. Its Rivals Are Following the Same Playbook

eBayEBAY is selling more goods, but it wants fewer people running the business. The online marketplace is cutting roughly 9% of its workforce despite double-digit growth in merchandise sales, raising an interesting question for investors. Can a smaller team keep the momentum going, or will the cost cuts eventually catch up with growth?

Sales rise, shoppers barely budge

The latest layoffs, confirmed on Oct. 21, follow an earlier round of roughly 800 job cuts in February. CEO Jamie Iannone told employees that the company's strategy was working, even as eBay prepared to reduce its headcount again.

The numbers explain some of that confidence. Gross merchandise volume, or the total value of goods sold through eBay, rose 14% to $22.4B on a currency-neutral basis in the second quarter. US merchandise volume grew even faster at 24%.

But there's a catch. Active buyers increased just 2% to 136M, meaning eBay's growth is coming largely from existing customers spending more rather than a wave of new shoppers joining the platform.

eBay is picking its prioritieso

The layoffs aren't happening in isolation. eBay is concentrating its investments in categories where it sees more opportunity, particularly authenticated luxury goods, collectibles, and refurbished products.

There's already some evidence that the approach is gaining traction. Its AI-powered card-scanning tool has processed more than 80M scans, while first-party advertising revenue jumped 25% to $570M last quarter.

The company is also expanding its reach through acquisitions. Its $1.4B purchase of fashion resale platform Depop, completed July 30, brings younger shoppers into the business and adds another specialty resale category.

Those investments come alongside restructuring expenses, which reached $105M in the first half of 2026. eBay is effectively trying to direct more resources toward its strongest opportunities while reducing costs elsewhere.

Rivals are making similar moves

eBay isn't the only marketplace trying to grow without expanding its workforce. EtsyETSY reduced its staff by roughly 12% while introducing an AI gifting assistant, even as second-quarter marketplace sales rose 7.5% to $2.58B. Its active buyer count remained largely unchanged at 87M.

AmazonAMZN is approaching the same challenge from a much larger base. Its third-party seller services revenue grew 16% to $46.8B last quarter, while customers using its AI shopping assistant spent more than 40% extra per order, according to the company.

Smaller platforms are attracting capital, too. Live-shopping marketplace Whatnot raised $545M at a $20B valuation after merchandise sales exceeded $8B in the first half of 2026, matching its total for all of 2025.

The approaches differ, but the direction is similar. Marketplaces are putting more emphasis on technology, higher spending per customer, and categories where they can compete more effectively.

Earnings will put the cuts to the test

For eBay investors, the next question is whether those changes can translate into sustained growth. The company expects third-quarter merchandise volume of $22B to $22.4B, representing growth of 10% to 12%, with results scheduled for Oct. 28.

That report should offer a clearer picture of whether eBay can keep growing its specialty categories while operating with fewer employees. It will also help investors judge whether stronger spending from existing buyers can compensate for relatively slow customer growth.

The bigger story goes beyond eBay. Online marketplaces are increasingly looking for ways to generate more sales without building larger teams. The winners will be those that can turn those efficiencies into lasting growth rather than simply lower expenses.