By Akanksha Rana
(Reuters) – EBay Inc <EBAY.O> beat Wall Street estimates for quarterly profit on Tuesday and raised its full-year outlook, as the e-commerce company benefited from a surge in online shopping by people staying indoors due to coronavirus-driven lockdowns.
Business has been booming for e-commerce firms and companies with strong online presence as the COVID-19 pandemic has led more people to use their mobile phones and computers to shop.
Ebay now expects full-year adjusted profit between $3.47 and $3.59 per share. Analysts were expecting $3.51 per share, according to IBES data from Refinitiv.
Wedbush analyst Ygal Arounian said that e-commerce related stocks have largely outperformed since the beginning of the pandemic and expectations are really high.
“It’s not a surprise to see some weakness on results,” Arounian added.
Shares of eBay, which have surged about 56% so far this year, fell nearly 3% to $54.75 in extended trade.
The company last week agreed to sell its classified ads business to Norway’s Adevinta <ADEV.OL> in a deal worth $9.2 billion, succumbing to longstanding pressure from activist investors Elliott Management Corp and Starboard Value.
Pressure from the activist investors also resulted in the company naming Walmart <WMT.N> executive Jamie Iannone as its top boss in April, handing over the reins to an outsider.
“I think the stock is down due to … some concern that the new CEO might reinvest some of the recent upside to try to strengthen the company’s competitive position,” Atlantic Equities analyst James Cordwell said.
Revenue rose to $2.87 billion in the second quarter, from $2.42 billion a year-ago, beating analysts’ estimate of about $2.8 billion.
Excluding items, the company earned $1.08 per share, above estimates of $1.06 per share.
(Reporting by Akanksha Rana in Bengaluru; Editing by Shailesh Kuber and Maju Samuel)