Shares of eBay Inc. experienced a significant drop in after-hours trading on Wednesday following the release of the company’s earnings outlook for the current quarter. Despite beating expectations with its second-quarter earnings, eBay’s forecast fell short of the Wall Street consensus.
Q3 Earnings Forecast
eBay, headquartered in San Jose, California, projected adjusted earnings of 96 cents to $1.01 per share for the third quarter. Additionally, the company estimated revenue in the range of $2.46 billion to $2.52 billion. However, analysts had anticipated earnings of $1.02 per share on revenue amounting to $2.47 billion.
Second-Quarter Performance
In the second quarter, eBay reported a net income of $171 million, equal to 32 cents per share. This was a significant improvement compared to the year-ago period, during which the company suffered a loss of $531 million, resulting in a loss per share of 95 cents. Adjusted earnings for the second quarter reached $1.03 per share, up from 99 cents per share in the prior year.
Revenue Growth
eBay also experienced an increase in revenue, which rose from $2.42 billion in the year-ago period to $2.54 billion this quarter.
Despite these positive earnings and revenue figures, eBay’s stock price faced a decline of up to 4.5% in after-hours trading, following a 1% rise during the regular session, where it closed at $48.80.
Overall, eBay’s second-quarter performance showcased growth in both net income and revenue. However, the lower-than-expected earnings outlook for the third quarter seemed to have influenced the market’s reaction to the company’s results.
