eBay Plunges on Weak Guidance

Tickers in this article: EBAY

NEW YORK (TheStreet) -- Shares of eBay plunged following weaker-than-expected guidance for the third quarter.

The San Jose-based company expects third-quarter sales to be between $3.85 billion and $3.95 billion. That's below consensus, with analysts surveyed by Thomson Reuters expecting $3.97 billion in sales. Non-GAAP earnings per share are expected to be between 61 cents and 63 cents per share, below the 65 cent estimate.

Though third-quarter guidance missed estimates, eBay managed to report earnings in line with consensus for the second quarter. Non-GAAP net income was $822 million, or 63 cents per share, a 13% year-over-year increase driven mainly by strong top-line growth. The company reported revenue for the second quarter of $3.877 billion, a 14% increase from the same quarter in 2012.

Analysts surveyed by Thomas Reuters expected eBay to earn 63 cents per share on $3.892 billion in revenue.

EBay reported a 21% increase in Enabled Commerce Volume (ECB) to $51 billion, evincing the strength of the company's global commerce platforms. PayPal continue to show strong growth, increasing revenue in the second quarter 20%, to $1.6 billion. PayPal added 4.7 million active registered accounts during the same period, a 17% increase for a total of 132 million accounts.

"We had a strong second quarter, with $51 billion of enabled commerce volume across Marketplaces, PayPal and eBay Enterprise driving double-digit revenue and earnings growth," said eBay President and CEO John Donahoe in the press release. "Macroeconomic headwinds in Europe and Korea will continue to be a challenge in the second half of the year. But our core businesses are strong and we continue to attract millions of new customers each quarter through mobile innovation. We remain confident in our ability to meet our goals and drive global commerce innovation and leadership."

Shares of eBay rose 1% to $57.38 during the regular trading session. The stock is moving lower in extended-hours trading, down 6.26% to $53.79 according to Nasdaq.com.

--Written by TheStreet Staff in New York