eBay Beats Q1 Estimates, Shares Surge

Shares of

surged more than 5 percent in after-hours trading after the company reported upbeat results for the first quarter. The San Jose, California-based company reported quarterly net income of $626 million, or $0.51 per share, versus a year-ago loss of $2.3 billion, or $1.82 per share. Excluding one-time items, eBay's non-GAAP earnings rose to $0.77 per share from $0.70 per share. Its revenue climbed to $4.45 billion from $4.26 billion. However, analysts were expecting earnings of $0.70 per share on revenue of $4.42 billion. Revenue from its payments business climbed around 14 percent to $2.11 billion. PayPal net total payment volume climbed 18 percent to $61 billion, while merchant services volume rose 26 percent. eBay Marketplaces gross merchandise volume shrank 2 percent. GAAP operating margin shrank to 16.4 percent for the first quarter, from 20.6 percent in the year-ago period. The company repurchased around $1.0 billion of its common stock in the first quarter. The average estimate among 65 Estimize users was for earnings of $0.72 per share and revenue of $4.47 billion. "We had a strong first quarter, with eBay and PayPal off to a good start for the full year," said eBay Inc. President and CEO John Donahoe. "I feel very good about the performance of our teams at eBay and PayPal. Each business is executing well with greater focus and operating discipline as we prepare to separate eBay and PayPal into independent publicly traded companies. We are moving forward with clarity and speed, with a smooth separation expected in the third quarter. We are deeply committed to setting up eBay and PayPal to succeed and to deliver sustainable value to our shareholders." For the full year, the company expects adjusted earnings of $3.05 to $3.15 per share, versus analysts' estimates of $3.10 per share. It projects revenue of $18.35 billion to $18.85 billion, versus expectations of $18.96 billion. eBay expects Q2 adjusted earnings of $0.71 to $0.73 per share on revenue of $4.4 billion to $4.5 billion. Analysts had projected earnings of $0.71 per share on revenue of $4.57 billion. eBay shares climbed 5.02 percent to $59.60 in the after-hours trading session.