EBay Inc. said Wednesday its first-quarter profit rose 11 percent as consumers spent more on its main website, but a disappointing forecast for the current quarter pushed the company's shares down sharply in after-hours trading.
EBay said it earned $397.7 million, or 30 cents per share, in the first quarter, compared with $357.1 million, or 28 cents per share, in the same period of 2009.
Excluding one-time items, the company earned 42 cents per share. Analysts polled by Thomson Reuters expected 41 cents.
Revenue climbed 9 percent to $2.2 billion, matching analyst estimates.
That reflected an improvement in eBay's biggest segment, which includes eBay.com, Shopping.com and other e-commerce sites. The company has been sprucing up its main site in hopes of attracting and keeping more shoppers. That has included rejigging its search and feedback system and starting a buyer-protection program in the U.S. and U.K.
"We're making steady, solid progress," said eBay CEO John Donahoe in an interview.
Indeed, marketplace revenue rose 13 percent to $1.39 billion. Sales of fixed-price "Buy it Now" items and the acquisition of South Korea's Gmarket contributed to the jump in revenue, eBay said.
EBay, based in San Jose, said the number of active registered users on its site rose just 1 percent from last year to 89.5 million. But its gross merchandise volume, which counts the value of all the items sold on eBay, excluding vehicles, rose 24 percent to $13.4 billion.
RBC Capital Markets analyst Stephen Ju said he was satisfied with eBay's quarter, saying the company showed "incremental progress" as it improves its marketplaces business.
"It's always going to be slow ... progress to turn a large e-commerce property like eBay around," he said.
Revenue from eBay's payments business, which includes PayPal and a short-term credit service called Bill Me Later, jumped 26 percent to $809.3 million. Total payment volume shot up 35 percent to $21.3 billion.
This business has grown rapidly as more consumers and merchants use it to send money online, on eBay and on other sites. EBay CEO John Donahoe believes that in the next few years this business' revenue will surpass that of eBay's marketplace.
For the current quarter, eBay forecast an adjusted profit of 37 cents to 39 cents per share on $2.15 billion to $2.20 billion in revenue. Analysts had been expecting 40 cents per share on revenue of $2.21 billion.
EBay chief financial officer Bob Swan explained during a call with analysts that the company is expecting a stronger dollar to hurt its results. When the dollar is stronger, transactions in other currencies translate into fewer dollars. The company kept its full-year forecast, though, which it issued when it gave its fourth-quarter report earlier this year.
EBay shares fell $2.12, or 8.1 percent, in after-hours trading, to $24.14. They finished regular trading at $26.29, down 11 cents.
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