EBay forecasts upbeat revenue as sneakers, refurbished items drive growth By Reuters
© Reuters. FILE PHOTO: The eBay app is seen on a smartphone in this illustration taken, July 13, 2021. REUTERS/Dado Ruvic/Illustration/File Photo
By Yuvraj Malik
(Reuters) -EBay Inc on Wednesday forecast current-quarter revenue above Wall Street projections after beating March-quarter earnings estimates, as it benefits from its strategy of focusing on product categories including sneakers and watches.
A selective push from the ecommerce firm also on items like collectibles and refurbished products is helping it drive sales at a time when consumer spending has moderated due to high inflation.
“There remains a dynamic and uncertain macro economic environment across the globe with inflation and rising interest rates and pressured consumer confidence … but our focus categories remain relatively resilient,” Chief Executive Jamie Iannone said in an interview.
The upbeat results soothed investor sentiment, which was hit after eBay (NASDAQ:) earlier this year said that demand weakness will persist in the first half of 2023. The company’s shares rose 5% in after-hours trading.
EBay is expanding listings under refurbished electronics, luxury bags and watches, and the collectibles category. The company bought trading cards marketplace TCGplayer last year.
San Jose, California-based eBay now expects June-quarter revenue in the range $2.47 billion to $2.54 billion, higher than analysts’ projection of $2.43 billion, according to Refinitiv.
Revenue in the most recent March quarter grew 1% to $2.51 billion, also beating analysts’ estimate of $2.48 billion. Adjusted earnings per share of $1.11 also came in higher than estimate of $1.07.
Gross merchandise volume, a key industry gauge that denotes the total value of goods and services sold on the marketplace, however, fell 5% to $18.4 billion.
“EBay seems to be gaining its original innovative mojo with improved payment, marketing, storage, user interface, and authentication,” said Michael Ashley Schulman, chief investment officer at Running Point Capital Advisors.
“Yet their potential earnings growth and turnaround capabilities don’t seem to be baked into the stock price.”
EBay’s shares have gained 4.6% so far this year, compared with a 13.3% rise in the tech-heavy .