EBay Shares Fall on Lowered Profit Outlook
October 18 2017 - 05:44PM
Dow Jones News
By Imani Moise
EBay Inc. reported higher-than-expected sales in its third
quarter, but shares tumbled after the company lowered its annual
profit outlook for the second consecutive quarter.
The online marketplace now expects adjusted per-share earnings
of $1.99 to $2.01 on as much as $9.57 billion in sales, compared
with prior guidance of $1.98 to $2.03 a share on up to $9.5 billion
in sales.
Shares fell 5.4% to $35.92 during after-hours trading, erasing
the 1.3% rise at market close Wednesday. EBay stock had gained 28%
this year through Wednesday's close.
Gross merchandise volume grew 8% to $21.7 billion in the
quarter, as the company added two million active buyers on its
platforms.
EBay has tried to shed its reputation as an online garage sale
by modernizing to attract younger and more loyal shoppers in recent
years. Over the quarter the company revamped its website and
marketing campaign in an attempt to gin up sales and gain momentum
leading into the critical holiday shopping season. Earlier this
year, eBay also added price-match and three-day delivery
guarantees.
The company has also been looking to lure big brands, who may be
turned off by Amazon.com Inc.'s high-pressure approach to selling,
to set up shops on its marketplace. Chief Executive Devin Wenig
said earlier this year that eBay was in talks with more brands and
the company would provide an update later this year.
Overall the San Jose, Calif.-based company reported earnings of
$523 million, or 48 cents a share, compared with earnings of $418
million, or 36 cents a share, a year earlier.
Analysts polled by Thomson Reuters were looking for earnings of
48 cents a share on $2.37 billion in revenue.
Write to Imani Moise at imani.moise@wsj.com
(END) Dow Jones Newswires
October 18, 2017 17:29 ET (21:29 GMT)
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