- Taxes on some wealthy French top 100 pct of income: paper
- North Korea fires short-range missiles for two days in a row |
- Israel warns against Russian arms supply to Syria
- Winning ticket for $590.5 million Powerball lottery sold in Florida |
- Toyota plans to increase lithium-ion car battery output-Nikkei
EBay shares drop on cautious forecast
SAN FRANCISCO |
SAN FRANCISCO (Reuters) - EBay Inc reported profit that matched Wall Street estimates and gave a restrained outlook for the rest of the year, sending its shares lower.
"Not a spectacular quarter," said R J Hottovy, an equity analyst at Morningstar. "It was essentially in line, which may have disappointed the market."
The operator of the largest online marketplace reported third-quarter net income of $490.5 million, or 37 cents a share, compared with $432 million, or 33 cents a share, a year earlier.
Excluding stock-based compensation expenses and other items, profit was $628.2 million, or 48 cents a share, in the latest period, the company said. Revenue climbed 32 percent to $2.97 billion.
Analysts, on average, had expected EBay to earn 48 cents a share on revenue of $2.91 billion, according to Thomson Reuters I/B/E/S.
EBay is riding a strong e-commerce growth wave as shoppers buy more online and through smartphones and tablet computers.
The company benefits from this trend because its Internet marketplaces make money by charging fees on transactions and other activity. The company's PayPal unit also wins as it takes a small cut of a rising volume of electronic payments processed on its network.
However, the debt crisis in Europe and global economic slowdown has the potential to restrain all types of consumption during the crucial holiday season, even online.
"I don't think it will be a great holiday, but we are putting our stake in the sand and saying we think it will be solid," eBay Chief Executive John Donahoe said in an interview with Reuters.
EBay forecast fourth-quarter profit of 55 cents to 58 cents a year. Analysts, on average, were expecting 58 cents a share, according to Thomson Reuters I/B/E/S.
EBay forecast full-year revenue of $11.5 billion to $11.6 billion and full-year profit of $1.98 to $2.01 a share.
When eBay reported second-quarter results in July, the company forecast full-year revenue of $11.3 billion to $11.6 billion and full-year profit of $1.97 to $2.00 a share.
"Investors were assuming there would be upside surprise in earnings or the guidance," said Fred Moran, an analyst at Benchmark Capital.
"They maintained their full-year forecast essentially, which reflects a little caution around the global economy," Moran added. "Management could increase forecasts later in the year, but things are too volatile right now to stick one's neck out."
EBay shares fell 4.1 percent to $31.82 in after-hours trading.
(Reporting by Alistair Barr; editing by Bernard Orr)
- Tweet this
- Share this
- Digg this