In the era of continuous innovation there are constant improvements in technology. The emergence of smartphones has thrown up a large number of ways for companies to grow. One such industry is the M-commerce industry, which has opened up a lot of opportunities for electronic payment providers. People find it extremely easy to shop and make payments through their phones, and hence the need for these providers.

eBay Inc (NASDAQ:EBAY) is one such player that has been truly enjoying the benefits of this new development. Its mobile payment solution, called PayPal, has been very successful. It has been posting great results, driving eBay’s performance north. In fact, recent fourth quarter results also highlighted the growing importance of PayPal and other efforts of eBay. Let us look into the details.

The Key Drivers…

Amazing initiatives taken by the company and customers’ growing mobile engagement drove revenue to $4 billion, registering a growth of 18% over last year. The top line was driven by growth in all the geographic regions and an increase in number of active users. Occasions such as Black Friday, Thanksgiving, and the peak winter season played an important role during the quarter.

However, this is not the first time that eBay has performed amazingly well and surpassed analysts’ estimates. The payment provider’s revenue has been increasing continuously over the last year, as depicted by the chart below:

EBAY Revenue Quarterly data by YCharts

PayPal has played a very important part in eBay’s performance. Growing acceptance of mobile payment systems has benefited not only eBay, but also its industry peers such as VeriFone Systems Inc (NYSE:PAY) and NCR Corporation (NYSE:NCR). However, eBay has shown the best growth in terms of return to investors, in comparison to its peers. Last year's stock price performance of some these players is shown in the chart below:

EBAY data by YCharts

eBay is the strongest player, with a 73% jump in its stock price. Though peers such as VeriFone have also been formulating strategies to combat competition and attract customers, its efforts are not up to the mark. It has recently launched SAIL, a payment processing system for small businesses. The system looks like a good move since it uses social media and many promotional offers to lure customers. Its customer loyalty program can also prove to be effective.

However, VeriFone will be facing stiff competition from eBay’s PayPal Here, which caters to the same market and is already available in some Home Depot’s stores.