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EBay shares slide as Q2 outlook comes up short

EBay shares slide as Q2 outlook comes up short


Shares in online auction site eBay (NASDAQ:EBAY) slipped in premarket trade Thursday, despite reporting profits that topped views, after its second quarter outlook missed analyst estimates on anticipated weakness in Europe.

The company forecast a second-quarter profit of 61 to 63 cents per share and revenue of $3.8 billion to $3.9 billion. Analysts polled by Thomson Reuters were calling for per share earnings of 66 cents on revenue of $3.95 billion.

For the quarter that ended March 31, the company earned $677 million or 51 cents per diluted share, up from $570 billion, or 44 cents per diluted share, a year earlier.

On an adjusted basis, net income was $829 million or 63 cents per diluted share, driven by strong top-line growth, the company said.

Revenue increased 14 per cent to $3.7 billion, compared to $3.2 billion in the same period of 2012.

Analysts expected per share earnings of 62 cents on revenue of $3.77 billion.

"We had a strong first quarter, with accelerating user growth across both Marketplaces and PayPal, and with GSI enabling their retail clients to grow faster than ecommerce," said president and CEO John Donahoe.  “Technology is creating a commerce revolution, and we are in the forefront with strong mobile leadership and a focus on helping retailers and brands engage consumers anytime, anywhere."

The company’s PayPal unit reported an 18-per cent increase in revenue of $1.5 billion. PayPal gained 5 million active registered accounts in the period and ended the quarter with 128 million, a 16 per cent increase. 

EBay said that PayPal's net total payment volume grew 21 per cent to $41 billion, driven by consumer and merchant use of PayPal, both on and off eBay. 

The company's Marketplaces business posted revenue of $2.0 billion, up 13 per cent year-over-year. Marketplaces gained 3.9 million active users in the period and ended the quarter with 116 million, also up 13 per cent from a year earlier. Gross merchandise volume, excluding vehicles, increased 13 per cent to $18 billion, as eBay continues to improve its core technology designed to make it easier and faster for consumers to shop and buy, it said.

The company's GSI Commerce business contributed $236 million in revenue for the first quarter, and saw a 16-per-cent rise in same stores sales.

Looking ahead, for the full year 2013, eBay said it expects net revenues in the range of $16 billion to $16.5 billion, with adjusted earnings per diluted share in the range of $2.70 to $2.75. Analysts are calling for per share earnings of $2.75 on revenue of $16.38 billion.

EBay’s shares were down 3.49 per cent in premarket hours, trading at $54.14.


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