EBay Shares Fall After Guidance Cut
By Michael Dabaie
EBay Inc. shares slid 9% to $49.46 in Thursday morning trading
after cutting guidance on impacts from the war in Ukraine.
The online marketplace after the bell Wednesday lowered its full
year revenue guidance to $9.6 billion to $9.9 billion, from a
forecast of $10.3 billion to $10.5 billion in February. EBay
lowered its guidance for adjusted per-share earnings to $3.90 to
$4.10, from its previous outlook for $4.20 to $4.40.
"Russia and Ukraine have historically made up less than 1% of
our global volume, but the war in Ukraine has measurably impacted
the economic growth and consumer confidence throughout Europe and
other parts of the world," Chief Financial Officer Steve Priest
said in the company's conference call.
"This conflict arose as global economies were already contending
with inflationary pressures and supply chain challenges. On top of
that, rising interest rates may further hinder near-term economic
growth, while sanctions related to the war could raise already-high
fuel prices leading to additional pressure on consumer spending,"
Mr. Priest said.
EBay reported first-quarter revenue fell to $2.48 billion,
topping the FactSet consensus for $2.46 billion.
Benchmark Street analyst Daniel L. Kurnos said in a note that
EBay "became one of the latest victims of slowing consumer
discretionary spend thanks to the global conflict and general
"While the quarter itself was healthy, coming in above consensus
and at the high end of the guidance range, management felt it
prudent to reduce the near-term forecast across the board," the
Benchmark note said.
Truist Securities analysts said in a research note that
initiatives around improving the product experience for
focus-categories while catering to "enthusiast" buyers "continue to
show green shoots" with faster gross merchandise value growth in
"These improvements if sustained will take time to start
materially impacting the trajectory of aggregate GMV growth and
profitability, in our view, exposing investors to more execution
risks," the Truist analysts said in maintaining their Hold rating
on the stock.
Write to Michael Dabaie at email@example.com
(END) Dow Jones Newswires
May 05, 2022 11:16 ET (15:16 GMT)
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