The following content is sourced from external partners. We cannot guarantee that it is suitable for the visually or hearing impaired.
(Bloomberg) -- EBay Inc. gave a lackluster profit forecast for the holiday quarter, blunting investor enthusiasm that the online marketplace was solidifying its position in an industry dominated by Amazon.com Inc.
While the company projected sales for the current period that slightly topped analysts’ estimates, shares declined as much as 7.9 percent in extended trading. The stock closed at $37.97 Wednesday in New York and has gained 28 percent this year.
Chief Executive Officer Devin Wenig is trying to speed EBay’s growth to prove that his turnaround strategy is working. The company has increased spending on marketing, redesigned its homepage to personalize products shown to each visitor and is making it easier for shoppers to navigate the site’s 1 billion listings.
“Investors have been looking for sustained momentum in the EBay turnaround story and, given the rather uninspiring results and guidance today, it looks like we may be waiting a little longer,” said Josh Olson, an analyst at Edward Jones & Co. “Also, active buyers appear light.”
The company reported its platforms attracted 2 million more global active buyers to 168 million in the period ended Sept. 30, adjusted for the loss of domestic buyers in India after the sale of its business there to Flipkart. Gross merchandise volume, the value of all goods sold, increased 8 percent to $21.7 billion.
Adjusted earnings in the current quarter will be 57 cents to 59 cents a share, San Jose, California-based EBay said Wednesday in a statement. Analysts projected 60 cents. Revenue will be $2.58 billion to $2.62 billion compared with analysts’ average estimate of $2.58 billion, according to data compiled by Bloomberg.
“I’d pin it to an expectations-performance mismatch,” James Cakmak, an analyst at Monness Crespi Hardt & Co., said of the share decline after the report.
In June, EBay announced a price-match guarantee on more than 50,000 items to lure bargain hunters to its site. The company is rolling out free three-day shipping on millions of products this year to compete with Amazon’s two-day shipping pledge to subscribers of the $99-a-year Amazon Prime membership. It launched an authentication service in September to boost sales of oft-counterfeited luxury handbags. Earlier this month, EBay introduced a “group listings” feature to consolidate search results into product categories so browsers don’t see the same product listed over and over again.
To contact the reporter on this story: Spencer Soper in Seattle at firstname.lastname@example.org.
To contact the editors responsible for this story: Jillian Ward at email@example.com, Andrew Pollack, Alistair Barr
©2017 Bloomberg L.P.