eBay issues gloomy forecast as tech stocks tank again
Web auctioneer says fourth-quarter profit could be as low as 25 cents per share. The company earned 39 cents per share during the same quarter last year.
Online auction giant eBay lowered its fourth-quarter revenue expectations and reported third-quarter numbers that met analyst forecasts.
Company executives said Wednesday that it expected fourth-quarter profit to come in between 25 cents to 27 cents per share, compared with the 39 cents it reported during the same period in 2007.
For the third quarter, eBay's earnings came in at the low end of Wall Street expectations with revenues of $2.12 billion, up $228 million from the third quarter of 2007. Net profit was $492 million, or 38 cents per share. Analysts predicted that eBay's earnings for the quarter would be between $2.1 billion and $2.15 billion.
The company's shares fell 13.6 percent, or $2.41, to close trading Wednesday at $15.33. In after hours, shares of eBay were trading at 14.22, down $1.11 or 7 percent. The markets, however, suffered another bloodbath and eBay was in no way the only tech stock that was punished. The CNET Tech Index closed down 7.9 percent at 1,131.56.
The Nasdaq fell 247.45 points or 6.8 percent. Shares of Apple dropped more than 5 percent to close at $97.95, and eBay rival Amazon finished the day at $48.72, down 12 percent. Microsoft shares fell nearly 6 percent to $22.66.
San Jose, Calif.-based eBay warned last week that the ailing economy was hampering efforts to spur growth in auctions. The company also told investors that it was planning a 10 percent staff reduction.