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Earnings Results: EBay stock drops after forecast comes up short

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Shares of eBay Inc. were falling about 6% in after-hours trading Wednesday after the online marketplace edged out expectations with its latest results but fell short of the consensus view with its outlook for the current quarter.

The company posted a first-quarter net loss from continuing operations of $1.34 billion, or $2.28 a share, whereas it recorded net income of $641 million, or 92 cents a share, in the year-earlier period. EBay
EBAY,
+1.80%

said that the loss was “primarily driven by the change in fair value of our equity investments,” per its release.

On an adjusted basis, eBay earned $1.05 a share, down from $1.09 a share a year before, but ahead of the FactSet consensus, which called for $1.03 a share.

Revenue slipped to $2.48 billion from $2.64 billion, while analysts had been looking for $2.46 billion. EBay noted that its promoted-listings feature generated about $222 million in revenue during the quarter, while total advertising offerings brought in roughly $267 million in revenue.

“Despite the current macro headwinds, we remain confident in the long-term strategy we laid out during our Investor Day in March,” Chief Executive Jamie Iannone said in the release. He added that eBay’s “enthusiast buyers continue to shop and engage on eBay regularly.”

The company sold a portion of its Adyen NV
ADYEN,
-1.82%

shares during the quarter for $551 million. EBay disclosed that it conducted $1.3 billion in share buybacks during the quarter while also paying out $129 million in cash dividends.

For the second quarter, eBay anticipates revenue of $2.35 billion to $2.40 billion, along with adjusted earnings per share of 87 cents to 91 cents. The FactSet consensus was for $2.54 billion in revenue and $1.01 a share in adjusted EPS.

Shares have fallen 8.2% over the past three months as the S&P 500
SPX,
+2.99%

has lost 4.5%.

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