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EBay’s Shares Tumble 8% On Weak Holiday Forecast

October 19, 2016

eBay CEO Devin WenigeBay CEO Devin Wenig
eBay CEO Devin WenigCourtesy of eBay

EBay forecast quarterly revenue and profit for the crucial holiday shopping season largely below market estimates, sending its shares down 8% in extended trading.

The company forecast revenue of $2.36 billion to $2.41 billion and adjusted profit from continuing operations of 52-54 cents per share for the current quarter.

Analysts on average were expecting revenue of $2.40 billion and earnings of 54 cents per share, according to Thomson Reuters I/B/E/S.

EBay has been working to reinvent itself since parting ways with PayPal, its main growth engine, in July last year.

The company has been offering a bigger selection of products and more brands and requiring sellers to give more details on products to attract younger shoppers and better compete with Inc and brick-and-mortar retailers that are beefing up their online presence.

Revenue rose 5.6% to $2.22 billion in the third quarter, beating the average analyst estimate of $2.19 billion.

Net income fell to $413 million, or 36 cents per share, in the quarter ended Sept. 30 from $539 million, or 45 cents per share, a year earlier.

Excluding items, Ebay earned 45 cents per share, beating the average estimate of 44 cents.