EBay vacation quarter outlook disappoints on U.S. weakness

Posted on 10.21.2013

EBay INC on Wed gave a unsatisfactory vacation forecast, voice communication the U.S. economic surroundings, as well as shopper confidence, had deteriorated partially thanks to the ending of the U.S. government.

Shares of the e-commerce company fell five.7 p.c in late commercialism.

Chief treasurer Bob Swan told investors on a phone call that business growth rates for e-commerce had contracted to concerning thirteen p.c within the third quarter, from concerning sixteen p.c within the previous quarter.

"We extremely haven't seen any longer positive signs in Oct," he added.

Earlier within the day, U.S. Senate leaders declared a deal to open the govt and avert a U.S. debt default.

But the deal would solely fund the govt till Gregorian calendar month fifteen, therefore Americans face the chance of another government ending.

"We will not grasp till weeks from currently, and that i hope this deal sticks," eBay Chief govt John Donahoe same once asked if the top of the conflict would elevate mood of shoppers.

Data firm ShopperTrak has forecast the slowest vacation sales growth since 2009, and last week, Sept retail sales showed U.S. shoppers were cautious, following a unsatisfactory second quarter for several retailers.

U.S. shopper confidence fell last month to its lowest since could, in keeping with a report discharged in late Sept by the Conference Board, associate degree business cluster.

EBay expects revenue of between $4.5 billion and $4.6 billion for the fourth quarter, ending New Year's Eve, compared with the $4.64 billion calculable by analysts, in keeping with Thomson Reuters I/B/E/S.

Net income for its third quarter was $689 million, or fifty three cents a share, up from $597 million, or forty five cents a share, a year earlier. Excluding the good thing about its sales of stakes in e-commerce corporations RueLaLa and ShopRunner, eBay earned  sixty four cents, one cent higher then expected. Revenue rose fourteen.3 p.c to $3.89 billion.

For the vacation quarter, eBay expects a profit of seventy nine cents to eighty one cents a share, whereas Wall Street analysts estimate eighty three cents.

The company unbroken its full-year forecasts, however business executive Swan same revenue and profits square measure doubtless to return in at the low finish of eBay's forecast.

PayPal, eBay's on-line payments division, according that total payments volume rose twenty four.7 p.c to $43.8 billion.

EBay lagged behind rival Amazon.com INC for many years, however Donahoe has LED a turnaround in recent years that focuses on mobile shoppers, international growth and tie-ups with native physical stores. Amazon, whose shares fell one.2 p.c in late trade on Wed, reports results next week.

EBay same that gross merchandise volume, or the greenback price of merchandise sold  on its marketplaces, rose 12.7 p.c to $18.4 billion within the u.  s., excluding car sales.

EBay same the surroundings in Europe and Asia was largely stable. In July, the corporate same Europe was deliberation on its results.

The e-commerce company's third-quarter profit was boosted by its PayPal on-line payments business as shoppers created larger use of its PayPal service.

This summer, eBay distended its eBay currently same-day delivery service into new markets and last month bought payments entrance Braintree for concerning $800 million to strengthen PayPal's presence on mobile devices.

To contend with Amazon's Prime service, PayPal is providing for a restricted time free two-day shipping for things got thereupon service.

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