eBay Inc. (EBAY) Wednesday reported a drop in third-quarter profit, despite 11% growth in revenues. However, both earnings and revenues trumped Wall Street estimates.
The online e-commerce giant also witnessed a decline in consumer online spending and active buyers. Shares of the company slipped 5%, hurt largely by its outlook for the fourth quarter.
eBay's third-quarter profit dropped to $264 million or $0.40 per share from $664 million or $0.94 per share last year. Adjusted income from continuing operations was $591 million or $0.90 per share, compared to $584 million or $0.82 per share a year ago.
Revenues for the quarter increased 11 percent to $2.50 billion from $2.26 billion last year.
Analysts polled by Thomson Reuters expected earnings of $0.89 per share and revenues of $2.46 billion for the quarter.
The company's gross merchandise volume, which is the value of goods sold on its websites, tanked 10% to $19.5 billion in the quarter. Annual active buyers declined by 5%, for a total of 154 million global active buyers, while annual active sellers were flat at 19 million global active sellers.
"Our team delivered another strong quarter, once again meeting or surpassing our expectations for all key business metrics, making further progress on our multi-year strategy," said Jamie Iannone, Chief Executive Officer of eBay.
Looking forward to the fourth quarter, the company expects revenues between $2.57 billion and $2.62 billion and adjusted earnings of $0.97 to $1.01 per share. Analysts currently expect earnings of $1.00 per share on revenues of $2.65 billion.
EBAY closed Wednesday's trading $77.66, down $0.84 or 1.07%, on the Nasdaq. The stock, further slipped $4.02 or 5.18%, in the after-hours trading.
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