EBay Forecasts Sales That May Miss Estimates Amid Amazon Rivalry

Ebay offices | Source: David Paul Morris/Bloomberg

SAN JOSE, United States — EBay Inc. may have fended off an attack from activist shareholder Carl Icahn, yet jump-starting sales growth may be a tougher fight.

The world’s biggest online marketplace said sales in the current period will be $4.33 billion to $4.43 billion. Profit before certain items will be 67 cents to 69 cents a share. Analysts on average projected revenue of $4.4 billion and profit of 70 cents, according to data compiled by Bloomberg.

As rival Amazon.com Inc. moves further into EBay’s turf, Chief Executive Officer John Donahoe is looking for ways to shore up the company’s main e-commerce business by investing in mobile and other services to boost user traffic. In March, retailers on Amazon saw sales rise 26 percent from a year earlier, while those on EBay posted a gain of 18 percent, according to software provider ChannelAdvisor Corp., which works with both companies.

“There’s a lot of competition,” said Victor Anthony, an analyst at Topeka Capital Markets Inc., who rates the stock a hold. “Amazon is a huge challenge for EBay.”

First-quarter sales rose 14 percent to $4.26 billion, the San Jose, California-based company said today in a statement. That compares with the average analyst estimate of $4.23 billion. Including a $3 billion tax charge, the company had a net loss of $2.3 billion, or $1.82 a share, compared with net income of $677 million, or 51 cents, a year earlier. Excluding certain costs, profit in the first quarter was 70 cents a share, compared with the average estimate of 67 cents.

EBay shares fell as much as 3.4 percent in extended trading to $52.70. The stock climbed 1.7 percent to $54.54 at the close in New York, leaving it little changed for the year.

By Brian Womack; Editors: Pui-Wing Tam, Jillian Ward, Ben Livesey