- eBay on Wednesday topped Wall Street’s expectations for second-quarter earnings, but slashed its full-year profit forecast.
- Shares fell more than 7% as investors were spooked by the guidance pullback amid the company’s ongoing fight against Amazon.
- Follow eBay’s stock price in real-time here.
Shares fell more than 7% in early trading Thursday after the company said its full-year revenue will be $US10.75 billion to $US10.85 billion, down from its previous forecast of $US10.9 billion to $US11.1 billion. It also slashed its third-quarter earnings per share outlook to between $US0.54 and $US0.56, versus the $US0.56 that analysts surveyed by Bloomberg were expecting.
Second-quarter earnings came in at $US0.53 a share, topping the $US0.51 that was anticipated. Revenue missed slightly, coming in at $US2.64 billion versus $US2.66 billion.
“In Q2 we continued to execute our strategy, making improvements to the core eBay experience. At the same time, we pursued significant opportunities in advertising and payments,” Devin Wenig, Ebay’s chief executive, said in a press release. “As we look ahead to the second half of 2018, we expect acceleration in our core business and continued strong growth in earnings.”
At a time when Amazon continued to grow – and other traditional retailers like Walmart are beefing up their online presence – eBay can’t afford to stumble, analysts say. Amazon now accounts for 49.1% of all e-commerce market share, according to data from eMarketer, up from 43.5% last year.
“The buyers on EBay are engaged, but they’re not bringing enough new customers to the platform. Morningstar analyst TJ Hottovy said, according to Bloomberg. “They’re doing some interesting things, but it’s tough to compete with Amazon.”
Shares of eBay have fallen 1.34% this year, underperforming the benchmark S&P 500’s 4.4% gain.
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