EBay Drops After Weak Outlook on Fading Pandemic Sales Bump
(Bloomberg) -- EBay Inc. gave a lackluster sales and profit outlook for the current quarter, accelerating its decline from the peaks reached when shoppers were stuck at home during the pandemic. The shares fell as much as 8% in extended trading.
Sales will be $2.35 billion to $2.4 billion in the period ending in June, the San Jose, California-based company said Wednesday in a statement. Analysts, on average, projected $2.53 billion, according to data compiled by Bloomberg. Earnings, excluding some items, will be 87 cents to 91 cents a share, falling short of the average estimates of $1.02.
The momentum the online shopping site gained during the pandemic when people abandoned stores for websites has been fading as shoppers return to in-person browsing and buying. Chief Executive Officer Jamie Iannone maintains that EBay’s advertising and payments businesses can boost profits even if total spending on the site falls. He has pledged to focus on the highest-priced items requiring authentication like brand-name sneakers, watches and other collectibles, and spend less money on promotions that lure random customers who don’t stick around.
Amazon.com Inc. also has seen e-commerce business plateau from its pandemic highs. Last week, the company said revenue at its online stores declined 3% in the first quarter from the period a year earlier.
EBay sales decreased 5.9% to $2.48 billion in the period ended March 31, the company said Wednesday in a statement. Analysts, on average, estimated $2.46 billion, according to data compiled by Bloomberg. Earnings, excluding some items, were $1.05 per share, beating estimates of $1.04.
The shares fell to a low of $49.50 in extended trading after closing at $54.42 in New York. The stock has fallen about 18% so far this year, in line with a broader market drop.
EBay ended the quarter with 142 million active buyers, down 13% from a year earlier. Gross merchandise volume, which is the value of all goods sold on the site, fell 20% to $19.4 billion.
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