eBay Falls 5% After Tepid Earnings and Guidance

Online auction giant eBay reported inline second-quarter earnings after the market close Thursday. $EBAY’s tepid growth and full-year guidance was short of estimates sending the stock off near 5%.

The auction e-commerce giant eBay (EBAY) reported second-quarter earnings after the close Thursday.  The result was in line with expectations but tepid growth and lowered forward guidance concerned investors sending the stock down near 5% after hours. 

$EBAY’s total value of goods sold on its platform, the Gross Merchandise Volume (GMV) rose 3% to $21.5Bil in 2Q17. StubHub’s however GMV declining 5% YoY. Marketplace had 3% YoY growth

Earnings: Net income of $493 million or 45 cents per share in line with estimates. Revenue of $2.3 billion also in line with expectations, just 4% growth year over year. On an unadjusted basis the earnings fell to $27 million, or just $0.02 per share, from $435MM, or $0.38 per share, a year ago. $EBAY took a non-cash income tax change of $311 million for ongoing realignment of its legal structure.

Reaction: eBay Inc NASDAQ After-hours35.40 –1.78 (-4.79%)  
“During the past two years, we have made significant progress to modernize eBay and drive growth by improving the customer experience, creating a product catalog that covers more than half of our inventory, and sharpening the eBay brand,” said eBay President and CEO Devin Wenig in a statement.
EBAY Earnings

Source: alphastreet.com


For 3Q17, $EBAY sees net revenue between $2.35Bil and $2.39Bil, with non-GAAP EPS ranging $0.46-0.48 and GAAP EPS ranging $0.30-0.32 from continuing operations. The firm’s third-quarter earnings guidance, of between 46 cents and 48 cents per share is on the lower end of analyst expectations.

For FY17, net revenue to be between $9.3Bil and $9.5Bil, with non-GAAP EPS ranging $1.98-2.03 and GAAP EPS ranging $1.65-1.75 from continuing operations. Analysts are expecting $9.4 billion in revenue from eBay this year, in line with eBay’s issued guidance on Thursday. Last year, the firm reported total revenue of $9 billion, which was up about 5% from 2015.

Stock Buyback

$EBAY announced an additional $3 billion stock repurchase authorization. During 2Q17, the company repurchased approx. $507 million of its common stock, with remaining authorization of $479 millionas of June 30, 2017.

Source: eBay, Alpha Street

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