eBay Inc. has released its earnings result for the fourth quarter of fiscal year 2013. Among the most interesting news, activist investor Carl Icahn has submitted notice that he has nominated two of his employees to eBay’s Board of Directors as part of a proposal he has to spinoff PayPal as a separate business. It’s worth noting that Icahn controls an “economic interest” of 0.82 percent of the company.

Icahn, who has stakes in companies like Apple, told Bloomberg that it’s a “no-brainer,” but admits that it will be a long-shot to get pushed through. Part of his motivation to see PayPal spun-off is because he thinks that by separating it from eBay, PayPal will be able to innovate faster and get things done faster. This mirrors something similar to what PayPal president David Marcus said at last night’s ReadWrite Mix event in San Francisco when discussing how to scale the payment processing company.

Update: However, as Kevin Marks pointed out in the comments below, Marcus also said that in order for pure pay startups to succeed, it needs a “parasite/host” relationship — something that PayPal currently has with eBay.

eBay and PayPal have published an in-depth explanation on why a spin-off doesn’t make sense, while acknowledging that they have considered it. It cites three main reasons: “eBay accelerates PayPal’s success; second, eBay data makes PayPal smarter; and third, eBay funds PayPal’s growth.”

As candid as he could say, Icahn expressed disapproval towards eBay’s management and said that the executives aren’t making the right moves to help shareholders.

Are investors buying into the latest proposal from Icahn? Shares in the online marketplace company is up 7.57 percent in after-hours trading to be at $54.41.

Reacting to the proposal, eBay said in its statement that it “welcomes the opportunity” to listen to the activist investor’s perspective:

Regarding Mr. Icahn’s separation proposal, eBay’s Board of Directors routinely assesses the company’s strategic direction and has explored in depth a spinoff or separation of PayPal. eBay’s Board of Directors has concluded that the company and its shareholders are best served by the current strategic direction of the company and does not believe that breaking up the company is the best way to maximize shareholder value. As part of eBay Inc., PayPal is able to leverage the company’s technology capabilities, commerce platforms and relationships with retailers, brands and large merchants worldwide. Payment is part of commerce, and as part of eBay, PayPal drives commerce innovation in payments at global scale, creating value for consumers, merchants and shareholders.

Of note, as part of eBay Inc’s earnings report, PayPal saw revenue increase more than 19 percent in the quarter and also in the full fiscal year, contributing $6.6 billion to eBay in 2013. This quarter also saw 5.2 million active registered users sign-on, giving PayPal a total of 143 million (a 16 percent increase).  There were also 3 billion transactions made — a 25 percent increase in net total payment volume for the quarter.

Part of PayPal’s movement was mobile, one of the key areas Marcus has focused on during his tenure. The company says that payments volume off eBay grew 128 percent for the year and total mobile volume this year was $27 billion.

Icahn’s move comes also on the heels of his increased financial involvement with Apple.

Today’s revelations also come alongside eBay’s announcement that it was implementing an additional $5 billion stock repurchase program. This size will be added to the company’s existing $640 million stock repurchase program that was authorized in June 2012.

Photo credit: eBay Inc.