EBay Earnings Beat by a Penny; Outlook Falls Short

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EBay delivered a slight beat on earnings but its outlook disappointed and shares fell after-hours.

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For the second quarter, eBay expects to post adjusted earnings between 61 and 63 cents a share, compared with an estimate of 66 cents a share from analysts surveyed by Thomson Reuters.

Late last month, eBay set aggressive three-year growth targets, based on international expansion plans and more focus on mobile commerce.

The company is investing heavily in these initiatives and such spending may be behind the weaker second-quarter profit forecast, said R.J. Hottovy, an equity analyst at Morningstar.

"These investments are building for the future so that should be taken positively, even if they come at the expense of short-term profits," Hottovy added, while noting that eBay's full-year 2013 forecasts remained unchanged.

For the full year, eBay expects to post adjusted earnings between $2.70 and $2.75 a share on revenue of $16 billion to $16.5 billion. Analysts currently expect earnings of $2.74 a share on revenue of $16.38 billion.

EBay sees faster growth in the second half of the year, CFO Robert Swan said on the earnings call.

For the first quarter, earnings excluding items rose to 63 cents a share from 55 cents a share in the year-earlier period.

Revenue at the e-commerce company increased 14 percent to $3.75 billion from $3.28 billion a year ago.

Marketplace, eBay's online platform for selling goods and services, grew 13 percent in active users during the reported quarter supported by mobile, site enhancements and emerging markets, said in a statement.

User growth does not immediately translates into revenue, said company executive during the earnings call, as the users are less engaged at first.

Analysts had expected eBay to report earnings excluding items of 62 cents a share on $3.77 billion in revenue, according to a consensus estimate from Thomson Reuters.