eBay beats Wall Street estimates

E-commerce retailer eBay (EBAY) recorded first quarter revenues of $2.02 billion, a drop of $171 million compared to the same period last year, but above the $1.94 billion predicted by analysts. The numbers helped boost eBay's stock price over six percent in after hours trading.

Earnings per share came in at 39 cents, better than the 34 cents per share estimates of Thomson Reuters. The company said its performance was attributable to the impact of the strong dollar and the decline of its Marketplace business in the current difficult economic conditions.

The company said it will focus on its two core eBay businesses. EBay's payments unit posted strong quarterly results with revenues of $643 million, a year-over-year increase of 11 percent. Fueled by a 22 percent increase in the number of active accounts, total payments for the quarter increased by 10 percent to $15.86 billion. The company said the payments business, led by PayPal, will continue to focus on "the acquisition of new merchants, greater penetration into the marketplace business and the growth of Bill Me Later" service.

As expected with the economic slowdown, eBay's Marketplace business unit showed a decline in revenue to $1.2 billion -- about an 18 percent drop from the same period last year. The company said it will continue to try and stabilize its core business "by improving trust, value and selection for customers while looking for ways to drive growth through geographic, format and category expansion."

The company's proposal last week to acquire Gmarket to expand its Marketplace business in lucrative Asian markets will certainly help drive growth.
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