EBay Inc, the world's No. 1 Internet auctioneer, said second-quarter earnings more than doubled to US$109.7 million. Profit and forecasts weren't as high as some investors expected, dragging the company's shares down as much as 6.2 percent.
Net income surged to US$0.33 a share, from US$54.3 million, or US$0.19 a share, a year earlier. Revenue jumped 91 percent to US$509.3 million from US$266.3 million, the San Jose, California-based company said. EBay will split its stock 2-for-1 on Aug. 28.
EBay exceeded analysts forecasts for profit by US$0.02 a share, or lower than what some investors may have expected after the company exceeded analysts' first-quarter estimates by US$0.05 a share and had a tripling of profit in the fourth quarter.
EBay's shares have more than doubled since September.
"It was a good quarter, but the stock's had a run anticipating a better-than-good quarter," said Paul Cook, director of technology investing at Munder Capital Management, which manages more than US$30 billion of assets, including EBay shares.
Third-quarter profit excluding certain costs will be US$0.34 a share on revenue of US$515 million, EBay said. That's less than Thomson Financial's survey, which predicted a US$0.35 profit and US$518.2 million in revenue.
Net income this quarter will be US$0.29 a share, or US$0.01 less than it previously projected, because of EBay's recent acquisition of EachNet Inc to accelerate growth in China.
EBay's market value of US$36.7 billion is almost three times that of as much as Sears, Roebuck & Co, the largest US department store chain.
Excluding stock-based pay costs, amortization and certain other expenses, EBay said second-quarter profit would have been US$0.37 a share. On that basis, which doesn't conform to generally accepted accounting principles, the company was expected to earn 35 cents, according to Thomson Financial.
"People may be a bit surprised the upside this quarter was not as strong and that guidance is not raise more," said Derek Brown, a Pacific Growth Equities analyst who has an "equal-weight" rating on the shares and does not personally own the stock.
"Which, when all is said and done, are all minor negatives on a very strong second quarter," he said.
The company, which gets most of its revenue from fees and commissions charged sellers, said the value of goods sold through its sites rose 66 percent to US$5.6 billion.
The number of EBay users climbed to 34.1 million in the past year as chief executive officer Meg Whitman sought to attract new users and encourage repeat business through television commercials with a "Do It EBay" tag line.
Revenue from transactions in the US rose 45 percent to US$242.4 million as people used EBay to auction items ranging from PEZ candy dispensers to 707 aircraft converted into homes. The increase was down from the 49 increase in the first quarter.
International transaction revenue soared to US$155.1 million, a 146 percent rise from a year earlier. That increase was lower than the 166 percent gain in the first three months of the year.
"This business just continues its `up and to the right' trajectory," said chief financial officer Rajiv Dutta in an interview. He said EBay has raised its revenue forecast for this year by US$245 million since first issuing projections last year.
PayPal transaction revenue jumped 90 percent to US$99.4 million from US$52.5 million last year. EBay bought the service that allows people to transmit payments via e-mail for US$1.5 billion in October.
EBay boosted its full-year earnings forecast to as much as US$1.31 a share and said sales may rise to as much as US$2.08 billion, US$25 million more than earlier estimates.
NO RECIPROCITY: Taipei has called for cross-strait group travel to resume fully, but Beijing is only allowing people from its Fujian Province to travel to Matsu, the MAC said The Mainland Affairs Council (MAC) yesterday criticized an announcement by the Chinese Ministry of Culture and Tourism that it would lift a travel ban to Taiwan only for residents of China’s Fujian Province, saying that the policy does not meet the principles of reciprocity and openness. Chinese Deputy Minister of Culture and Tourism Rao Quan (饒權) yesterday morning told a delegation of Chinese Nationalist Party (KMT) lawmakers in a meeting in Beijing that the ministry would first allow Fujian residents to visit Lienchiang County (Matsu), adding that they would be able to travel to Taiwan proper directly once express ferry
FAST RELEASE: The council lauded the developer for completing model testing in only four days and releasing a commercial version for use by academia and industry The National Science and Technology Council (NSTC) yesterday released the latest artificial intelligence (AI) language model in traditional Chinese embedded with Taiwanese cultural values. The council launched the Trustworthy AI Dialogue Engine (TAIDE) program in April last year to develop and train traditional Chinese-language models based on LLaMA, the open-source AI language model released by Meta. The program aims to tackle the information bias that is often present in international large-scale language models and take Taiwanese culture and values into consideration, it said. Llama 3-TAIDE-LX-8B-Chat-Alpha1, released yesterday, is the latest large language model in traditional Chinese. It was trained based on Meta’s Llama-3-8B
STUMPED: KMT and TPP lawmakers approved a resolution to suspend the rate hike, which the government said was unavoidable in view of rising global energy costs The Ministry of Economic Affairs yesterday said it has a mandate to raise electricity prices as planned after the legislature passed a non-binding resolution along partisan lines to freeze rates. Chinese Nationalist Party (KMT) lawmakers proposed the resolution to suspend the price hike, which passed by a 59-50 vote. The Taiwan People’s Party (TPP) voted with the KMT. Legislative Speaker Han Kuo-yu (韓國瑜) of the KMT said the resolution is a mandate for the “immediate suspension of electricity price hikes” and for the Executive Yuan to review its energy policy and propose supplementary measures. A government-organized electricity price evaluation board in March
NOVEL METHODS: The PLA has adopted new approaches and recently conducted three combat readiness drills at night which included aircraft and ships, an official said Taiwan is monitoring China’s People’s Liberation Army (PLA) exercises for changes in their size or pattern as the nation prepares for president-elect William Lai’s (賴清德) inauguration on May 20, National Security Bureau (NSB) Director-General Tsai Ming-yen (蔡明彥) said yesterday. Tsai made the comment at a meeting of the Legislative Yuan’s Foreign Affairs and National Defense Committee, in response to Democratic Progressive Party (DPP) Legislator Wang Ting-yu’s (王定宇) questions. China continues to employ a carrot-and-stick approach, in which it applies pressure with “gray zone” tactics, while attempting to entice Taiwanese with perks, Tsai said. These actions aim to help Beijing look like it has