EBay CFO: It will get worse before it gets better
EBay reported mixed quarterly earnings and revenue on Wednesday and announced plans to cut some 2,400 positions, or about 7 percent of its workforce, as it prepares to split its PayPal and eBay marketplace businesses into two publicly traded companies.
During the company's earnings call, eBay Chief Financial Officer Bob Swan said 2015 would present "real challenges" and forecast that "it will get worse before it gets better."
Separately, the company said it entered into an agreement with billionaire activist Carl Icahn, the company's largest active shareholder, and will appoint Jonathan Christodoro, Icahn's pick, to its board.
The company appointed three board members in total, with the other two coming from eBay's nominations.
"Their appointments are the result of significant effort by the nominating committee over the last several months to find talented new directors who will contribute valuable expertise to eBay and PayPal as we create two best-in-class boards," said CEO John Donahoe.
The e-commerce company posted fourth-quarter earnings of 90 cents per share, up from 81 cents a share in the year-earlier period. Revenue rose to $4.92 billion from $4.53 billion a year ago, helped by its sales in it PayPal mobile payments unit and increased holiday sales.
Wall Street had expected the company to deliver quarterly earnings per share of 89 cents on $4.93 billion in revenue, according to consensus estimates from Thomson Reuters.
Shares were up about 3 percent in extended-trading after the announcements.
EBay forecast fiscal-first-quarter revenue of between $4.35 billion and $4.45 billion. Analysts surveyed by Thomson Reuters currently expect revenue of $4.7 billion.
For the full year, the company sees earnings coming in the range of $3.05 to $3.15 per share, with revenue ranging from $18.6 billion to $19.1 billion.
Ebay has been troubled by fierce competition from companies like Amazon and Google. In September the e-commerce company announced that its PayPal and eBay marketplace businesses would be split into separately traded public companies in the middle of 2015. John Donahoe will also step down as CEO once the split is completed.
The company's stock was all over the map last year and closed 2014 three dollars higher than its start of $53.06. EBay shares have gained about 0.4 percent over the last 12 months, underperforming the Nasdaq, which gained 11 percent over the same period.
Correction: An earlier version of this story misidentified the person who is joining eBay's board via the agreement with Carl Icahn.