EBay's second-quarter profit forecast falls short of estimates
![EBay's second-quarter profit forecast falls short of estimates EBay's second-quarter profit forecast falls short of estimates](https://cdn.zeebiz.com/sites/default/files/styles/zeebiz_850x478/public/2017/04/20/17766-e-baypixabay.jpg?itok=xaA5KfsJ&c=3c77987e6af178be4c594af109eda6b1)
EBay Inc
Shares of the company fell 2.5 % to $33 in trading after the bell.
San Jose, California-based eBay has been making changes to its platform to lure more shoppers as well as better compete with Amazon.
That has meant a shift away from online auctions towards fixed-price sales and product landing pages, which are easier to navigate than the dozens of listings sellers would generate for a single good.
EBay has also increased its marketing spending, running a rare TV campaign ahead of last year`s holiday shopping period.
Sales and marketing costs climbed 4.5 % to $562 million in the first quarter ended March 31, while product development expenses jumped 16.3 % to $278 million.
The company`s profit in the second quarter would be affected by "increased investment to drive improved user experiences and to market our brand," eBay`s finance chief Scott Schenkel said on a call with analysts.
EBay said it expects second-quarter adjusted profit of 43 to 45 cents per share. Analysts on average were expecting a profit of 47 cents per share, according to Thomson Reuters I/B/E/S.
The company, however, stuck to its earlier forecast for full-year adjusted profit of $1.98 to $2.03 per share, expecting more growth in the second half of 2017.
The first quarter "showed some early indication that their efforts are beginning to bear fruit," said Wedbush Securities analyst Aaron Turner, citing more active buyers coming to the site. "We`re still waiting to see" the outcome, he added.
EBay said gross merchandise volume — the total value of all goods sold on its websites — rose 2.4 % to $20.95 billion in the first quarter. But the result fell short of analysts` average estimate of $21.06 billion, according to research firm FactSet StreetAccount.
The company`s net income rose to $1.04 billion, or 94 cents per share in the quarter, from $482 million, or 41 cents per share, a year earlier.
Excluding one-time items, the company earned 49 cents per share, beating analysts` average expectation of 48 cents per share.
Revenue rose 3.7 % to $2.22 billion. Analysts on average had expected $2.21 billion.
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