Exceeding analysts’ expectations eBay still posts low profits

On Tuesday an ecommerce giant eBay posted its quarterly results with a net profit exceeding the expectations of the Wall Street, reports Reuters. Besides it also gave its forecast for the third quarter. Apart from connecting sellers and buyers online through auctions and fixed-price sales eBay also includes Web payments unit PayPal and Internet telephone company Skype.

Second-quarter net profit was $327.3 million, or 25 cents a share, from $460 million, or 35 cents a share, a year earlier. Excluding one-time items, eBay earned 37 cents a share, a penny above the 36 cents per share expected, on average, by analysts.

The report showed that revenue fell 4% to $2.1 billion — above the $1.99 billion, or 9% drop, expected by Wall Street. The company's marketplaces division saw a 14% drop in revenue while sales in fast-growing PayPal jumped 11%.

Operating margins fell to 19.6 in the quarter from 24.8% a year earlier, the company said, hurt by the effect of the stronger U.S. dollar against foreign currencies.

EBay said it expects third-quarter adjusted earnings per share in a range of 34 to 36 cents a share, compared with the 35 cents a share expected by Wall Street.