EBay Inc. on Wednesday reported fourth-quarter results that met or beat analysts’ expectations despite being down year over year, as well as a first-quarter outlook that beat estimates. The company’s stock took an initial increase immediately after the markets closed, but then fell more than 5% in extended trading.
“Our Q4 results demonstrate the continued resilience of our marketplace amid economic uncertainty,” said Steve Priest, chief financial officer, in a statement.
The company reported fourth-quarter net income of $672 million, or $1.23 a share, compared with $1.97 billion, or $3.25 a share, in the year-ago period. Adjusted earnings were $1.07 a share, adjusted for stock-based compensation, depreciation and amortization and other costs. Revenue fell to $2.51 billion from $2.61 billion in the year-ago quarter, and gross merchandise volume was $18.2 billion, a decrease of 12% year over year. Analysts surveyed by FactSet had forecast earnings of $1.07 a share on revenue of $2.47 billion.
For the full year, eBay reported a net loss of $1.27 billion, or $2.27 a share, on $9.8 billion in revenue, which it attributed mostly to a loss in value of its investments. Analysts had expected earnings of $4.11 a share on revenue of $9.75 billion.
EBay expects first-quarter adjusted earnings of $1.05 a share to $1.09 a share on revenue of $2.46 billion to $2.5 billion, while analysts had forecast adjusted earnings of $1.07 a share on revenue of $2.37 billion. The company’s board also declared a quarterly dividend of 25 cents a share, a 14% increase from a prior dividend.
Shares of eBay have been doing well so far this year, increasing by about 15%, while the S&P 500 index has only increased by about 4% year to date. Despite the initial rise in the stock price after the markets closed, the stock eventually fell more than 5% in extended trading.
The resilience of eBay’s marketplace was demonstrated in the fourth-quarter results, despite the economic uncertainty. The company reported a decrease in revenue and gross merchandise volume year over year, but still managed to meet or beat analysts’ expectations. The company’s first-quarter outlook also beat estimates.
The company’s board declared a quarterly dividend of 25 cents a share, a 14% increase from a prior dividend, and the stock has been doing well so far this year. The company’s resilience and the stock’s performance show that eBay is in a good position to continue to weather the economic uncertainty.
