The online auction and shopping website posted solid earnings for Q3 this year but stock of the company slumped due to weaker outlook for the final quarter of the year.
The company announced on Wednesday, October 16, that its revenue for the third quarter ended September 30, 2013, increased 14 percent to $3.9 billion, compared to Q3 of 2012.
eBay reported that the company achieved a profit of $689 million, or 53 cents a share, on revenue of $3.9 billion compared to its earnings of $597 million, or 45 cents a share, on $3.4 billion in sales in Q3 2012.
"We delivered strong third quarter results, with mobile driving a significant portion of our new user growth and continuing to transform how consumers shop and pay around the world," said John Donahoe, President and CEO, eBay Inc.
Donahoe added "Our scale and experience, the strength of our global commerce platforms, our technology assets and our mobile commerce capabilities strongly position us to be a leader in the commerce revolution under way. In the past 12 months we have enabled $200 billion of commerce volume, a 20 percent increase in a fairly lackluster macro environment. That growth demonstrates the strength of our core businesses and our power as a partner, not a competitor, to merchants, brands and retailers."
According to a MarketWatch report, the results of the company were consistent with the forecast of analysts surveyed by FactSet. The analyst made an estimation that eBay will earn 63 cents a share on revenue of $3.9 billion.
However, the company's shares fell by around 5 percent when it announced Q4 2013 profit estimation. eBay announced it estimates 79 cents to 81 cents a share, on revenue between $4.5 billion to $4.6 billion for the final quarter of 2013. However, analysts' had made a slightly higher forecast for a profit of 83 cents a share on $4.64 billion in sales.
The company's annual outlook for adjusted earnings between $2.70 and $2.75 per share and revenue of $16 billion to $16.5 billion remains unchanged.
The company's earnings call also stated that its Marketplaces business saw revenue increase by 12 percent to $2 billion. Gross marketplace volume, excluding automobiles, also rose up 12 percent to $18 billion.
The company's payment business, PayPal, also saw in increase in revenue by 19 percent to $1.6 million.
