California-based eBay unveiled the move as it announced its profit in the fourth quarter rose to $US936 million on $US4.9 billion in revenue.
The job cuts will be across eBay’s three divisions: Marketplaces, Enterprise and PayPal.
The reorganisation will return eBay to its roots with the “Marketplaces” division, which includes its auctions and online retail sales and accounted for nearly half its 2014 revenues.
“We will be simplifying organisational structures to focus the businesses and ensure that we are set up to compete and win,” said eBay, which also plans to explore options to separate the Enterprise division, which creates online sites for traditional retailers.
eBay announced plans last year to spin off PayPal amid pressure from activist shareholder Carl Icahn, and said the move would help the unit compete better in the fast moving online payments segment.
In a further move to refocus, eBay said it would likely also shed its Enterprise division in a sale or public offering which creates an independent company.
CEO of eBay, John Donahoe, said the overall company is in good shape ahead of the reorganisation, which will spin off PayPal in the second half of the year.
“In a year of unexpected events and distractions, we ended 2014 with double digit revenue growth, solid earnings growth and strong cash flow, reflecting the fundamental strengths of our company,” he said in the statement.
PayPal accounted for 44 per cent of eBay revenue in 2014, but it is facing new challenges amid a shift to mobile payments and new entrants to the market, such as Apple and Google.
Icahn has said that the payments sector needs “consolidation” – either through acquisitions by PayPal or by merging it with “another strong player in the industry”.
EBay said it had made progress in boosting sales to customers using mobile devices.
Mobile payment volume grew to $US45.6 billion for the full year, representing 20 per cent of total sales volume.