The market hasn’t been too pleased with eBay (Nasdaq: EBAY) lately after it hived off PayPal as an independent company. Over the past few quarters, eBay has been delivering lackluster performance for its e-commerce division and has failed to keep pace with e-tail giant Amazon. To make matters worse, the company is facing increasing competition from newer and smaller niche players like Etsy and Poshmark and has also suffered from its vulnerability to Google’s algorithm changes in the recent past. But the recent quarter’s results suggest that all is not lost.

eBay’s Financials

eBay’s Q1 revenues grew 4% over the year to $2.14 billion, ahead of the Street’s expectations of $2.08 billion. EPS of $0.47 was also ahead of the market’s forecast of $0.45 for the quarter.

During the quarter, gross merchandise volume (GMV) grew 5% over the year on a constant currency basis to $20.5 billion. On a reported currency basis, GMV reported a growth of 1% over the year. By segment, revenue from Marketplace Platforms grew 3% over the year to $1.8 billion and accounted for $19.6 billion of GMV. StubHub revenue grew 34% to $177 million and recorded a GMV of $869 million due to the increase in sports and concerts events and product innovations. eBay’s Classifieds Platforms saw revenue grow 17% to $186 million driven by strong growth in Germany and the United Kingdom.

Among operating metrics, active buyers grew 4% over the year to 162 million at the end of the quarter. It continued to increase inventory on its platforms and ended the quarter with more than 900 million live listings.

For the current quarter, eBay forecast revenues of $2.14 billion-$2.19 billion with an EPS of $0.40-$0.42. The Street was looking for revenues of $2.14 billion for the quarter with an EPS of $0.44. eBay expects to end the current year with revenues of $8.6 billion-$8.8 billion, compared with the Street’s forecast of $8.7 billion.

eBay’s Innovations and Acquisitions

During the quarter, eBay made several advancements to improving the user experience. Within Marketplace, eBay has concentrated on search. It began to leverage its structured data initiative and made several improvements in search. Not only has search become easier, but users can now also search by features such as product ID. The site is also allowing merchants to use smartphones to scan barcodes on new products so that eBay’s platform will automatically fill in descriptions and specifications to simplify the listing process. eBay also launched a new capability to allow shoppers to find hot deals and top-selling products on its website.

To continue search-related enhancements, eBay also announced the acquisition of privately held Expertmaker. Sweden-based Expertmaker is an artificial intelligence technology provider. eBay plans to leverage the acquisition to continue to improve its structured data initiative to better manage its inventory and aggregate insights into supply and demand. The terms of the deal were not disclosed. This is not the first transaction eBay has made within the machine learning space. It had bought machine learning service provider Positronic back in 2009.

Earlier this month, eBay also announced plans to grow its Valet offering. eBay Valet was launched two years ago and it handles the end-to-end process of listing, pricing, and shipping of products for sellers in exchange for a 20%-40% commission. More recently, eBay tested a feature that allowed customers to drop off goods they want to sell through Valet at FedEx drop locations in Atlanta and Los Angeles. eBay is pleased with the initial results of the service and has now tied up with FedEx to utilize more than 1,600 drop off locations across the country for this service.

eBay is also expanding its presence into newer categories. Recently, it announced the launch of its wine category. Now consumers will be able to buy wine directly through eBay through its tie-up with mobile wine delivery service Drync. eBay is selling more than 10,000 wines, which include not only everyday wines, but also rare and collectible vintages from over 30 countries and more than 500 regions. Analysts estimate that the $34 billion wine industry sees a mere 5% online penetration. IBIS world estimates online sales for wines to grow to $1.4 billion by 2020, a market that eBay is hoping to make its mark in.

For StubHub, eBay introduced several innovations as well. It launched a new ticket recommendation feature that shows a “best value” option to users allowing fans to identify great deals and discover new events. The feature is available on desktop, mobile Web, and StubHub’s native iOS and Android apps. It also introduced virtual reality capabilities to allow users to get an immersive view from available seats to make better decisions on what tickets they want to purchase.

Within Classifieds, eBay launched user enhancements that included in-app chat on mobile that allows buyers and sellers to message each other to facilitate the transaction.

The market is happy with eBay’s attempts. Growth may be lagging, but the company appears to be headed in the right direction. Its stock is currently trading at $23.78 with a market capitalization of $27.3 billion. It touched a 52-week high of $29.83 in December last year and had fallen to a 52-week low of $21.52 in February this year.