EBay shares drop on Q2 guidance miss, despite first-quarter revenue growth

EBay shares drop on Q2 guidance miss, despite first-quarter revenue growth
Added a month ago
Summary: Increased sales of sneakers, luxury watches and trading cards helped propel a 42% increase in revenue year over year.
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Stocks: $EBAY

EBay Inc.’s first-quarter results beat expectations on growth in its core categories, namely sneakers and luxury watches, the company said Wednesday.

Increased sales of those items, plus trading cards, helped propel a 42% increase in revenue year over year.

“We generated tremendous volume and earnings, with revenue growth the highest it has been since 2005,” said Jamie Iannone, the company’s chief executive, in a statement.

But shares of eBay EBAY, +1.00% fell more than 5.6% after hours, after a 1% increase in the regular session to $62.32, because the company forecast earnings that fell short of analyst expectations.

The online-marketplace company reported first-quarter net income of $641 million, or 92 cents a share, compared with $3.41 billion, or $4.51 a share, in the year-ago period, which included discontinued operations. Adjusted earnings were $1.09 a share, adjusted for stock-based compensation and other costs. Revenue rose to $3 billion from $2.13 billion in the year-ago quarter.

Analysts surveyed by FactSet had forecast earnings of $1.07 a share on revenue of $2.97 billion.

EBay’s gross merchandise volume rose 29% to $27.5 billion. Analysts had expected $26.31 billion.

The San Jose, Calif.-based company said its annual active buyers increased 7% to 187 million worldwide, with the company seeing an additional 2 million buyers in the first quarter from the previous quarter. 

EBay expects second-quarter earnings of 67 cents a share to 72 cents a share on revenue of $2.98 billion to $3.03 billion, while analysts had forecast 81 cents a share on revenue of $2.93 billion.

Shares of eBay have risen nearly 25% year to date, and are up more than 60% in the past 52 weeks.

This story has been updated to replace analysts’ second-quarter earnings estimate with the GAAP figure.