EBay shares drop on holiday worries

The stock sinks on a cautious outlook. Executives cite a 'rapid deceleration in the market.'

By InvestorPlace Oct 17, 2013 12:42PM

Screenshot from http://www.ebay.com/new (© Ebay)By Christopher Freeburn


Shares of online auction giant eBay (EBAY) sank more than 3% Thursday after the company signaled that it expects a weak holiday shopping season.


During the third quarter, eBay earnings totaled $689 million, up from $597 million during the same time last year. Adjusted per-share earnings of 64 cents slightly topped Wall Street estimates, The Wall Street Journal notes.


Despite the good news, the company's chief financial officer said eBay has noticed "a pretty rapid deceleration in the market," which suggested a cautious outlook for the holidays. CEO John Donahoe noted that retail sales were headed lower during the third quarter and that recent political squabbles in Washington had increased uncertainty.


The company recorded $3.89 billion in quarterly revenue, with its online marketplace generating $2.03 billion. That matched analysts' forecasts.


Its online payment service, PayPal, continued to perform well, with revenue rising 19% during the quarter. The service saw its number of users rise 4% compared to the prior quarter to 137.4 million. Ebay acquired PayPal for $1.5 billion more than a decade ago.


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11Comments
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Problem for American sellers on ebay, is ebay has opened up its market for Chinese sellers. US sellers cannot compete with the Chinese because,the Chinese govt. subsidizes the shipping costs for its sellers, so most, are offering free shipping to the US. Also the Chinese sellers are selling fake, silver and gold jewelry, for not much over a dollar and a lot of other shoddy merchandise. While it is true, the Chinese sellers, offer returns, if not happy with there products, it would cost ten dollars, to ship the jewelry back to China to get your dollar back.  Writing this comment, so people aware of the ongoing problem with ebays Chinese sellers.
Oct 17, 2013 1:10PM
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Typical eBay Blame-Game; could be their endless fees and self-serving rules that have wiped so many small sellers off the map and forced those that are struggling to stay to pass on the costs to buyers? Before clicking "Submit," do an internet search for IT, and see how much you can save...
Nov 3, 2013 12:14PM
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Amidst stockholder fears my bum. Lot more to it then that. The one biggest thing is that eBay "mainly" relies on word of mouth and does very little television advertising if any as of these past few years. Case in point; the NYS Lottery never slowes and is always strong because they inundate the airwaves with advertizing. The buyer market is shifting do to demographics that eBay's marketing team is oblivious too. Get on eBay and search for an item and you will see what you thought was rare is being sold by hundreds of sellers. No shortage of sellers regardless of all the anger at all the fees. Too many sellers and a quickly exiting consumer do to a plethora of socioeconomical factors that eBay ignores because they are too busy tripping over a buck to pick up a nickel. They suffer from a business as usual mindset and have gotten so big that the bureaucracy within has them too entangled to reach any common sense goals. Very very very common in big business.  Remember that movie with Tom Hanks where he wishes and gets turned into a child? He ends up with a job playing with and testing toys for a corporate company who's team is so caught up burnt out and apathetic to the business science end of things that they lose touch with their main clientele, who they are and what they want? That is eBay in a nutshell.
Nov 3, 2013 12:57PM
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YES, EBAY IS REALLY GOING DOWN, THEY HAVE NEW RULES THAT DEGRADE YOU AS A SELLER, I HAVE BEEN DOING EBAY FOR APPROX 11 YEARS, IT IS ALL POLITICS TODAY. ALL ABOUT HOW MUCH MONEY THEY CAN GET. I PERSONALLY KNOW SELLERS THAT ARE GOING ON TO WEBSTOR.COM AND E-BID I KNOW I AM. LESS MONEY AND LESS RULES, AFTER ALL WE ARE ADULTS AND HAVE A BRAIN AND WE SEEM TO BE HONEST IF WE HAVE BEEN SELLERS FOR A LONG TIME, I WOULD PUT MY MONEY IN STOCKS ON THOSE PLACES. TO MUCH DRAMA.
Nov 3, 2013 12:35PM
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I don't sell on eBay anymore. Used to sell all the time but the fees became ridiculous. 10% by the time you figure in listing fees,closing fee,more than 1 or 2 pic fees,Paypal fee and then their insistence of using their postage ship out. I now do better on craigslists and meet in a public setting, it makes me and the seller or buyer more comfortable.

I still buy if the deal is good. But lately I'm seeing crazy prices on used electronics reaching almost what you can buy new for. $10 less for used is not a deal, pay the extra $10 and get new. But thats not ebays fault, its the bidders who don't have enough sense to shop around.

Oct 20, 2013 1:43PM
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It's just a matter of time before the SEC takes a long hard look into ebay.
Nov 3, 2013 1:49PM
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EBAY PROBLEMS ARE NOT ANYTHING TO DO WITH CHINA, IT'S ALL EBAYS OWN DOING WITH THIER B---S--T RULES AND EXORBITANT FEES, HELL THEY MAKE MONEY ON YOUR SHIPPING CHARGES, HOW TACKY IS THAT. IT'S BAD FOR BOTH PARTIES. I CANT IMAGINE WHY THEY HAVE A PROBLEM WITH THE HOLOCOST STUFF FOR SALE GIVEN THE WAY THEY DO BUSINESS, IT'S RATHER HITLERISH. IF THEY HAD A PROBLEM WITH IT THEY SHOULD HAVE HANDLED IT SOONER AS THEY SHOULD HAVE. LAMEBRAINS I TELL YA LAMEBRAINS.
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Forget shopping this year. We've had Insurance, gas, food, taxed on everything...and double taxed.....go up. I would like to actually save something to go on a vacation. Shopping? Last thing on my mind.
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