EBay posted a 53% increase in adjusted earnings for the third quarter and provided full-year guidance that topped expectations.
The online auction site earned 41 cents a share on revenue of $1.89 billion, exceeding analysts' consensus forecasts for profit and sales.
EBay was seen earning 33 cents a share on revenue of $1.83 billion, according to a consensus estimate from Thomson Financial.
In the third quarter of 2006, eBay earned 26 cents a share and reported a topline of $1.45 billion.
Shares of the company rose about 8 percent in after-hours trading after closing at $40.60 during regular trade Wednesday.
Excluding one-time items, eBay's adjusted profit was $564 million, representing a 53 percent rise over a year ago.
Including a $1.39 billion writedown on the purchase of Web-based phone service Skype, eBay posted a sharp net loss: $936 million, or 69 cents per diluted share, compared with a profit of $281 million, or 20 cents per diluted share, in the year-earlier quarter.
"Results were driven by a combination of somewhat stronger performance in our big markets, as well as newer, faster growing businesses," President and Chief Executive Meg Whitman said. She cited top markets in the United States and Germany.
The company's effective third-quarter tax rate, excluding one-time items, was 10 percent, down from 27 percent in the same quarter a year earlier. About a penny per share of reported operating earnings came from currency translation, she said.
"A good chunk of the over-performance was execution," Whitman said, although tax benefits, foreign currency gains and ongoing share buybacks by the company also figured strongly.
Revenue from its core marketplaces business grew 26 percent from a year earlier to $1.32 billion, in line with its growth rate in the second quarter but above the 22 percent to 24 percent rate the business had seen in prior quarters.
Results in the auctions, classified merchandise and fixed-price shopping were driven by strong performance in eBay's international business, especially in Germany, as well as its PayPal Merchant Services business, which provides online payment services to sites off of eBay's own, Whitman said.
Other key contributors were StubHub, a sports and entertainment ticket reselling site it acquired this year; its classified merchandise business; and advertising deals it has with Yahoo in the United States and Google in Europe.
For 2007 as a whole, eBay said it expected earnings per share, excluding one-time items, of $1.47 to $1.49, well above the earnings Wall Street was looking for, which ranged from $1.35 to $1.41 per share, according to Reuters Estimates.
The company said it expected net revenue for 2007 in a range of $7.60 billion to $7.65 billion, well above the average analyst forecast of $7.49 billion but at the top end of the $7.41 billion-to-$7.64 billion range of analysts' forecasts.
Early this month, eBay said it would cut as much as $1.2 billion off the $4.3 billion potential price it agreed to pay when it acquired Skype in a controversial deal two years ago.
Skype's two co-founders also agreed to resign as executives after the unit has repeatedly failed to reach financial goals.
In anticipation of solid results in its core business, eBay shares gained 5.2 percent to close at $40.60 in regular-session trading on Nasdaq prior to the publication of the company's report. The stock is up 35 percent so far this year. By contrast, the Nasdaq is up 15.6 percent.
EBay is enjoying solid business momentum early in the fourth quarter but considers it too early to say how holiday shoppers will behave by year-end, its chief executive said on Wednesday.
Meg Whitman, president and chief executive of the world's largest online marketplace, cautioned that she sees no "hard-to-get" product this year that could drive consumers to the online auctions and other shopping sites it runs.
"I think we have good momentum going into Q4," Whitman said in a phone interview, but added: "It is still early. Holiday shoppers shop later every year."
"The question mark is not about our own product plans," Whitman said. "The question is: How strong will holiday shopping be and will online gain share from offline shopping as it has in the past? That is unknowable."
Asked about the risk to the company's business if consumer spending slows late in the year, she said: "If consumers reduce spending, of course that will have some inpact on us."
In its 12-year-history, eBay has often benefited from pent-up demand for rare "hot products" ranging from last year's Nintendo Wii gaming console back to the Cabbage Patch doll craze of the mid-1990s.
"We don't see there is something of the magnitude of a hot product like the Wii this quarter," Whitman said.
- Reuters contributed to this report.